Instagram is really changing the dynamics of watch collecting. Here is a real life example of how.

Last May 2015 Phillips sells 6062 pyramid dial above. No sale. I make bid 3 days later. Already sold. I find watch at DP at Art Basel Design stand. I think about it. Inquire about a possible purchase. Too late. Sold again. Fast forward to December. I find watch on the Instagram account of a friend – a US collector.

After months of negotiation I buy. It is my second buy on Instagram.

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Now there is nothing unusual what happened so far. But what I describe above has profound implications for the way the vintage watch industry will evolve in terms of buying and selling. Let me explain why.

First it should be stated that I usually buy my watches at auction. About 80% of all my vintage watch purchases have been via auction houses. But two out of my last 3 watch purchases have been through private collectors on Instagram. So 66% of my recent purchases have been done directly with private collectors due to Instagram. At this point in time it is hard to tell if this trend will continue for me personally. On the sell side (I rarely sell) I think not much will change. I will continue to use the auction houses to sell watches as I think for me it is the most efficient. On the buying side – it still open if my buying habits will change in terms of source.

But what I can say with confidence is that Instagram is changing the dynamics of watch collecting in general.

There will be losers and there will be winners.

Lets see who potentially the winners and losers will be from Instagram. Trying to identify the winners and losers will also reveal the risks of Instagram. 

Before we identify any winners or losers lets take a step back. How was watch trading done before Instagram?  For me personally – I used to check all the dealers websites for inventory. I would wait until the auction houses put their catalogues on-line. That is how I would get an idea of what is available on the market. I did not attend any GTG and thus did not have the chance to trade among collectors.

Enter Instagram.

Well suddenly everybody has a platform which to expose their watches. Collectors. Dealers. Auction houses. Vintage watch stores. The impact has been dramatic.

• Dealers that used to use their websites – now have a real time platform to show the world their stuff. They use their websites but now in conjunction with Instagram. Some have stopped using their website all together. Its far quicker to upload a picture on Instagram (IG) than update your website. Plus the interaction with their clients is much better with IG than a website – collectors and dealers can leave comments and exchange views on IG through direct messaging on IG. It allows the dealer to get to know the collector better instead of communicating only by Email through a website. As a result of IG I am closer to dealers than ever before. I would say I am in direct contact with 75% of the worlds top dealers via DM (direct message) on Instagram. 

• Auction houses benefit too. Now they can give collectors a heads up on what is coming to auctions and can interact with a new generation of collectors. Sometimes I go through an auction catalogue and have all my lots figured out. Then a post from an auction house comes on Instagram showing a watch that they are selling in an upcoming auction – and I am like, ‘how on earth did I miss this lot? Looks super nice!’. Auction houses too can get to know collectors taste better than ever before and offer a more personalized service. Due to Instagram I have become friends with many employees at auction houses. This was helped by Instagram no doubt. Although it is hard to measure, IG has probably helped auction houses increase their turnover.

• For collectors Instagram is a dream come true. Now they get the whole world wide vintage market at their finger-tips. More information and more choices for the collector allows the collector to be better educated. Make better decisions (ideally). I think the collector profits immensely from instagram – perhaps more than any other stakeholder. Collectors can now trade directly with each other – share information and become friends. Geographic boundaries are completely broken down with Instagram. If a GTG is organised in Asia – I can take part via IG. I know who is attending, who is showing what and indirectly find out who did deals with whom. 

This is the incredible power of Instagram and social media. It is mind-blowing.

In many ways all parties profit from Instagram. But the biggest beneficiary in my view is the collector. 

But who are the losers?

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At first glance the obvious losers might be the dealers and auction houses.

If collectors start trading with each other increasingly – they will take market share away from dealers and auction houses. I think this is already happening to some degree. The collector who used to go to an auction house or dealer to sell his watch is selling or trading directly with another collector. As Phillip Stahl wrote in his post on this subject, ‘ Because of IG the dealer has no exclusive rights on a client anymore‘

However there is some upside and opportunity for both the dealer and the auction house in this equation. Let me explain.  

I already mentioned the dealer has the chance to get to know a collector better through instagram. I know some very large collectors who are dealing more with dealers as a result of Instagram. In fact my communication has also increased with dealers as a result of Instagram. Not only do some dealers have very deep pockets, they have a network that is often better than the collectors network (after all most collectors have a full time job).  If your looking for an impossible watch to find – chances are very good that a dealer will find it. Also I think the dealers will work even more closely together with the auction houses as a result of instagram. A case in point? The themed Chronograph steel only sale by Phillips. This sale would have never been a success had the dealers not worked very closely with the auction house and vice versa. I think as collectors move more closely to trade with one another so too will the auction houses and dealers. Instagram will bring all these parties closer together.

And the auction houses?

Yes they might initially lose market share due to collectors trading among each other but for the very high end watches – the auction houses will always be the place to go to. Have you ever heard of a watch costing more than $1m trade from one collector to another due to Instagram? Of course not. That watch will usually go via the auction houses to let the market decide what the value will be. Besides the auction houses are uping their game too concerning catering more to the collector on a permanent real time basis. Auction houses now are carrying real time auctions out themselves (just look at Christies live) and private treaty sales. Continuous live auctions can have advantages for collectors. The legal side, fee discussions – that is all taken care of if you buy via live auctions through an auction house. This is a big competitive advantage auction houses have.

Auction houses also have the advantage when it comes to a large collections being disposed of. If I am going to sell 10 watches at once – am I going to go via Instagram to market and sell that collection? Via a dealer? Most probably not. I will negotiate a set fee with the auction house – and they have the power and brand to market it much better than I could via Instagram.

What about the private collector? Is Instagram only a benefit to him? No. Far from it.

On the positive side there can be no doubt IG helps the collector enormously in terms of learning rapidly through shared information. Along with other social media – the young generation can learn about watches at an incredibly fast pace. Instagram has also undoubtedly helped the popularity of vintage watches. It has attracted a new generation of collectors to the vintage watch market. But with that comes a downside. As Auctionanalytics correctly pointed out this increased interest has also caused prices of vintage watches to increase. More than ever before, vintage watches are becoming expensive for novice collectors to get their first start. This however is not the only worry for new collectors. 

Instagram can be dangerous for the new and novice collector in other ways. Here is why:

• First it can give an incorrect image of a watch. Due to the various filters -even a complete wreck of a watch can look superb. It is why I advise a collector always to look at a watch before buying it. Do not rely solely on Instagram.
• Instagram also is dangerous for ‘alpha’ collectors. What do I mean? Well for a start – collectors often have big egos. Many collectors (myself included perhaps) will find themselves always comparing to the next better collector. We risk never being happy with what we actually own. There is always the next deal to be done in order to keep your Instagram cool and your likes and ‘social media popularity’ growing. This can be extremely dangerous.
• Instagram can also be misleading in terms of what collectors own: I know several accounts where some of the biggest watch collectors show a profile which has nothing to do with what they own in real life. Collections come and go and instagram only gives a glimpse into a collection at a given point in time. A few months later collections can look completely different. Why is this relevant: Well because it has happened that I looked up to a collector and liked his vision only to find out that the collector indeed has moved on to something completely different in terms of collecting. 
• Another danger of Instagram is that often collectors / dealers have an agenda in terms of what they show. It is therefore up the collector to ‘see through that’ and take an Instagram profile with a pinch of caution and scepticism.
• What about the risks involving payment if a deal is done via Instagram? What happens if a collector does not make good on this promise either to pay or to deliver the watch for the set price agreed? What happens if the watch is does not look like anything that was promised? I bet you these things happen all the time over Instagram. These are risks that happen with or without Instagram but they are worth pointing out because Instagram will facilitate private transactions and these private transactions carry this ‘payment’ and transaction risk.
• Another risk Instagram has for the collector is one of greed. Instead of holding on to collections – the collector will be seduced to trade more often always trying to upgrade or make the next ‘deal’. The collector himself will be tempted to become a dealer /collector – lured by financial gain. Now the collector has one platform which to sell to. Other collectors, dealers, even auction houses can be marketed to at one swoop of the finger on the screen. Buying and selling is picking up. It has become easier than ever to buy and sell partially because of Instagram. What does that mean to long term collectors like myself? I am constantly tempted to do more transactions – and I am not sure if all of them make sense long term. In that respect Instagram can be very dangerous and unproductive. 

Concluding remarks

As I mentioned before I think the biggest winner by far is the collector, although perversely at the same time, it is the collector who also has the most to lose.

In many ways Instagram has become the largest vintage watch dealer in the world and the individual collector profits immensely from this. Collectors can now deal directly with each other not only in trading watches but more importantly in gaining knowledge. And potential friendships too.

I think the winner is far more obvious than to say who the losers are.

Right now it is very hard to determine with certainty who the biggest losers are. In certain ways Instagram has the power to lift all boats and if all the different stakeholders use Instagram smartly – all parties (auction houses, dealers, vintage shop owners, museums) can benefit from using Instagram the platform. In that respect, Instagram is not a zero sum game. There are no losers at the expense of winners. At least I cannot see any trend so far.

The biggest benefit IG has had so far for me personally is allowing me to get closer to all parties of the vintage watch community. This includes dealers, collectors and auction houses. Most of all it helped me learn about watches. Learning about collections. Learn about collectors and how they think.

Instagram at the end of the day brings collectors closer together. It creates a powerful bond. Because sometimes the coolest and rarest watches don’t get traded publicly. Deals are done through closed doors. Through friendships with auction houses, dealers and other collectors that are established often through Instagram. 

Yes Instagram is a game changer. The clear winner for me is the collector. But it is also he who has the most to lose.