I just might be tempted to make a limited run.
The only thing I can think of is the fact that in this case you can easily track the supplier and find out the "original price" of the item in a way that is very hard to do for let's say a pair of Nike shoes, but that's about it. Walmart is also full of these watches and you can believe they don't sell them for $5.
Or do you really think it costs Dell exactly $679,95 to build a laptop on one of their entirely owned factories where they manufacture and store every single component that goes into it? And, if you call them now they even give you a $200 discount because wouldn't you know it they just happened to have a "promotion" just for you?
There is no such thing as a free anything, yet when Apple offers FREE BEATS WITH EVERY MAC PURCHASE no magazine would dare to call them out on the obvious fact that both of these items are so "overpriced" that they can even afford to give one away "for free" and still come out ahead. They instead run "articles" praising what a great value the offer is and also you should act now before the sale is over.
This "article" could be written about any company, literally any company.
Walmart sells the exact same watches. So does Amazon. Do you think they are a not-quite-scam too?
Keep in mind people are actually getting real watches. I don't know in what world that wouldn't make it a legitimate enterprise. And if you say it's because of their marketing, then you should really take a look at the copy on some car ads one day. Preferably Tesla.
If a local taco joint advertises 5 cent tacos for a promotion and they give you a moldy peanut butter sandwich, you would probably be really annoyed.
> Maybe this explains what’s so galling to people about the Folsom & Co. not-really-scam: It simply lays bare the categorical deception at the heart of all branding and retail. The different watch values are, in the strictest sense, speech acts: the watch is $29.99 because someone said it’s $29.99. It’s $29.99 because a certain person is wearing it on Instagram; it’s $29.99 because it’s photographed next to flannel and a Chemex. While “Bradley” of “Bradley’s men’s shop” may not be the most fleshed-out character, he – and the entire existence of Folsom & Co., Soficoastal, etc. – are examples of the now-household term, “brand storytelling.” And the internet makes it possible for anyone to tell any story, about anything, from anywhere.
It makes you realize that there really are tons of huge cases of products whose value is solely a result of marketing. My favorite current example is how YouTube influencers have completely upended the makeup industry, with each brand trying to convince you that this pallette of brown and red eyeshadow is imminently Superior to some other brown and red eyeshadow, when the input costs of all of them is literally under $1.
You must be in marketing as that made absolutely no sense.
Do you think Apple's usb-c charging cable, which is currently listed on their site[1] for $19.99 costs them anywhere close to that to source? and at the same time tries to sell you a hypothetical future? wow, they do have good marketing.
If anything these watch brands, and I don't know why you put it in quotes as if to take legitimacy away from them but whatever, have more things in common with Apple than with someone selling the same watches such as "Walmart", as they are both trying to decouple the object from the sale and make it about the experience.
They all make stuff up, and when they don't they hide the information so you don't find out. That is why Apple will never say the price they pay for the leather Macbook sleeve they are currently charging $199 for[2]. I suspect very few people will buy it if they advertise right next to the price the 12 dollars it is actually costing them.
To be clear, I am not against any of this, anyone can charge whatever they want. Apple is certainly doing very well charging the prices they do. I am just impressed that people, most of all here, where people that actually build and sell products, actually price and order components and actually manage a supply chain, hang act so surprised to the fact that markup exists and that marketing is used to justify it.
And I am not defending this crappy watches or this shady company; I wouldn't buy a needle from them. All I am saying is that they are not any more shady than 95% of the "brands" out there that are actually owned by a mega conglomerate and never disclose it anywhere when trying to sell purified water to hipster college students on their way to protests against capitalism or whatever.
[1] https://www.apple.com/shop/product/MUF72AM/A/usb-c-charge-ca...
[2] https://www.apple.com/shop/product/MRQU2ZM/A/leather-sleeve-...
Customer> I can buy this watch for $2 elsewhere.
Retailer> Then why are you here?
On some level, yes they're selling overpriced rubbish, but then everyone else is, especially in fashion. Their sin seems to be making it explicit.
How long before people are buying these watches to make post modern 'statements'?
I'm sure that's already a thing, sadly.
This is a really old strategy for getting credibility. Some scholars believe that Sun Tzu's Art of War is really much younger than what is claimed in the book. They believe that Sun Tzu focused on the book's supposed age and history, in order to give it more credibility.
In my grandfathers day it was a free lunch. Today a free watch and tomorrow a free light saber perhaps?
https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as...
[original w/comments: https://news.ycombinator.com/item?id=15158422]
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So a few years back I started a watch company in a similar way.
I think I was actually one of the first to do it, since when I started I couldn't find many competitors. I tried a million kinds of promotions, from "free, you just pay for shipping" to offering people discounts and referral codes.
I actually created my own watch designs (well, modifications of the face, case, and strap with the same Chinese movement.) Some of my improvements started to be used by the manufacturers.
I'm not at all invested in it anymore: I left the business after selling a substantial, but not massive number of watches and finding that it wasn't terribly profitable if you included the cost of advertising, shipping, and (most importantly) my own time.
My own "watch company" was more real in a few ways: watches that I did in fact design myself, shipped from my address in the US, and the quality of the watches was actually quite good. To this day I wear a watch from my company and it has held up to an incredible amount of abuse. I say this as someone who (used to) collect watches. I also was upfront about the cost of shipping and the watch itself - I might have, for example, a banner that says "Free 3-Day US Shipping" and then the price of the watch would be clearly labeled as $20, so people would know that they would only be paying a total of $20 for the watch. The prices varied a lot over time, from $10 to $40 per watch, but surprisingly my profit was never huge even though I only spent about $3 on the watch itself and $7 on shipping.
If anyone's curious about the whole thing (and lives in the Netherlands) I still have hundreds of these watches and I'd be happy to sit down over a coffee, tell my stories from the business and show the watches. (My email's in my profile.)
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A few comments I'd like to add now, in 2018:
1) the watches (mine & that of other "companies") are of a surprisingly high quality in many cases. Not always, but often. For example, my watch has survived everything from bilge fluids to boiling water and it's the same cheap one I sold. Definitely far more durable than a comparable mechanical watch. I can see myself still using this thing 10+ years down the line. Furthermore, it actually does look classy and I get compliments on it. Most of the time, if you buy a cheap $3 Chinese alternative to something that's normally 10-1000x the price, it is neither beautiful nor durable.
2) The unexpectedly high quality of the watches is what fueled the explosion of sites IMO. You don't see "free earbuds", "free clock", or "free keyboard" sites, despite the fact that all 3 of these things are available for under $5 shipped from China. What I think happened is that people bought a watch on a whim, then it arrived and they realized "wow, this feels like a premium product!" Which it did! I was blown away when I first saw the quality level and instantly thought I should start a business. I suspect hundreds of other people had this same "eureka!" moment. When you get a $5 Aliexpress keyboard, it feels and looks like it cost $5 to make, and it excites nobody. Furthermore, Amazon makes a $13 keyboard with great reviews, and being Amazon it ships with Prime instead of "30-to-infinity day slow-boat-from-China shipping." Meanwhile, these watches felt like they cost at least $20 to make, and the only competitors for classy analog watches would be $50-100 or so, but they cost $3 (drop)shipped!
3) I highly doubt anyone made much money. When I started, dropshipping was not a thing the manufacturers offered (probably the reason why I was one of the first.) When manufacturers started offering dropshipping, these "businesses" exploded because you could suddenly run them entirely behind a laptop. The problem, of course, was that the number of such "companies" exploded, all competing for the same customers, Facebook ads, Google results, "underground marketing" spots, etc etc. That led to people getting a bit suspicious. If you saw one ad for a cool watch, maybe you were interested, but if you saw 20 in a week, all suspiciously similar, you'd think something's up.
DW's watches are naturally higher quality as well, although in my opinion this isn't worth the price tag. You can get Chinese "copies" of DW watches for $10-20 or so that are nearly identical. I wouldn't exactly recommend them, but to be honest I don't think the quality would be that bad, and they do generally look nice. That said, I think that even if you're not willing to go the Aliexpress route you can find an attractive alternative for maybe half the price.
Watch snobs (I am one) would never wear a DW watch, but most people aren't watch snobs. If you want watch snob opinions, you can check out the great /r/watches (caution, you may get drawn to mechanical watches from the beautiful photos... an expensive hobby to have)
https://www.reddit.com/r/Watches/comments/7jw3l1/daniel_well...
https://www.reddit.com/r/Watches/comments/8n40p8/question_da...
I bought a "Tagheuer" watch on the streets of NYC for five dollars. At a glance, it looked OK but by the end of a day's wear it had completely self destructed.
Don't know it it is true but the movement inside claims to be Swiss.
Previous discussion: https://news.ycombinator.com/item?id=15154934
Not defending what this fake stuff brands are doing, and they not only exist for watches but also for jewelry, leather bracelets, etc, etc... but just saying it's also comparable to what cheap shopping mall brands sometimes do with accessories and watches but adding renting and expensive place in the middle and marking up everything way more.
"Ethical dropshipping" is the new baroque simplicity.
Feels and is a scam. Worst ever. I live in SF where it "claims to be" Why the hell is my shipment coming from Shanghai?
Going to miss my girlfriends gift date. WASTE of MONEY!
https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as...
Also, people will pay more for a good story.
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> "25. Maybe this explains what’s so galling to people about the Folsom & Co. not-really-scam: It simply lays bare the categorical deception at the heart of all branding and retail. The different watch values are, in the strictest sense, speech acts: the watch is $29.99 because someone said it’s $29.99. It’s $29.99 because a certain person is wearing it on Instagram; it’s $29.99 because it’s photographed next to flannel and a Chemex. While “Bradley” of “Bradley’s men’s shop” may not be the most fleshed-out character, he – and the entire existence of Folsom & Co., Soficoastal, etc. – are examples of the now-household term, “brand storytelling.” And the internet makes it possible for anyone to tell any story, about anything, from anywhere."
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> " thateffingasian: Capitalism is making your own product and selling it. Capitalism isn't buying a piece of shit and telling people they're worth 25x the price, and lying to them about the actual value of the product. Your idea of capitalism is fucked up @soficoastal. Then the idiots blocked me, LOL. "
If Capitalism isn't buying shit and lying about it to sell it for higher, I don't know what Capitalism is. This is only a difference in degree, not kind.
I'm neutral on the question in this case, but really, any discussion of "capitalism" that goes beyond chapter one, page one of an undegrad economics textbook covers the point that efficient markets are not deceptive markets. Participants are assumed to share equal information. HN's understanding of capitalist theory seems to begin and end at the phrase, "supply and demand", and everything that has a two-sided market is otherwise A-OK.
In this particular case, consumers are sort-of informed, but it's also a lot harder to be informed than it used to be. I'm someone who tries to find high-quality items, and even I screw up on a regular basis. I wouldn't fall for this one, though.
That is not a requirement for efficiency. Unknowns are factored into the price as "risk".
For example, if I am selling you my car, I know its condition a lot better than you do. But, the more you are suspicious about its condition, the less you are willing to pay for it.
If you're a crackerjack programmer, my interview process is inexact, so I'm going to discount the salary offer based on how risky it is that you're not a crackerjack.
Sellers offer guarantees in order to reduce the customer's risk, and hence be able to sell at a higher price. Investment returns are based on the riskiness of it. I pay more at the post office for less risk of non-delivery. Insurance companies, of course, are an entire industry based on managing risk.
Risk is a perfectly normal characteristic of efficient markets, perfect or equal information is not required at all.
Unfortunately this does not exist outside the textbook; there's an entire field devoted to information economics (Akerloff, Stiglitz et al). And then there's the brilliant "markets are efficient iff P=NP" paper: https://arxiv.org/pdf/1002.2284.pdf
So any form of arbitrage is therefore impossible. Hang on a minute...
Are 'efficient markets', defined by not being deceptive, and all participants having equal information, a requirement to call something 'capitalism'? Does that mean capitalism has never been tried? How long can such a system last, when it is in the financial interest of a large part of the participants to make the markets less 'efficient', so they can extract a higher price for less work?
So every discussion of "capitalism" that goes beyond chapter one is based on fairy tales?
Capitalism is where the gatekeepers on what can be produced and by whom, control through (typically hereditary) wealth and then use that position to capture the majority of and wealth produced (or wealth harvested in the case of unproductive business such as rent seeking). Dishonesty is not a necessary part but certainly occurs in any market where it is favored.
Incidentally, notions of supply and demand are part of a free market which does not necessarily have to be run by capital.
These scams are as old as commerce. Just more easily propagated using modern tools. They’re the reason Consumer Reports and reveiw publications exist. Caveat emptor.