← Making It with Jon Davids
Making It with Jon Davids
199 - How Rolex Uses Lies, Myth, and Deception To Sell So Many Watches
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John Davids
Rolex pulled in $11 billion last year. And even with 1.2 million watches made, these guys manufacture scarcity like nobody else. Rolex is a hype factory, and there's a lot to learn from how they do what they do. As the founder of an agency that makes hundreds of millions of dollars in revenue for our clients, I can tell you I've taken a lot of influence from Rolex over the years. My whole team has. I'm going to share some timeless lessons and tell you exactly how to apply them to your business. Right now, let's pay attention, because this could change the way you do business forever. That's coming up in just a sec. Welcome to the podcast. My name's John Davids, but you can call me J.D. i'm the CEO of Influicity, and on this show, I like to share the stories of some of my favorite businesses and the people behind them. If you're getting any value from this, you gotta do one thing for me. You need to share the show with a friend. That's the only way we grow. So grab your phone, open the podcast app, your messaging app, and share this episode with with someone you know who might get some value out of this. All right, let's get to the show. You're listening to Making it with John Davids. So let's rewind to 1926. Rolex just invented the waterproof watch. It's called the Rolex Oyster, and it's a very big deal. You see, up until now, we water and dust would mess up your timepiece. And Rolex just fixed that. They want to get the word out. So they start running ads showing the watch underwater. That's why in early Rolex ads, you'll see a lot of watch in water. They throw it in a fish tank, they throw it in a fountain. They throw it in a swimming pool. And it's working. This brand is growing fast, but we're just getting started. So fast forward one year. Now we're in 1927, and Rolex teams up with a famous swimmer. Her name's Mercedes Gleitz, and she swims across the English Channel while wearing her Rolex. She wears it around her neck. And then they run a newspaper ad with a bold headline. It says, rolex introduces for the first time the greatest triumph in watchmaking. And then they run a newspaper ad with a bold headline. It says, rolex introduces for the first time the greatest triumph in watchmaking, Rolex Oyster. And the ad tells readers to mail in a copy of the newspaper to get a Brochure. It's an early example, actually, of direct response marketing. The watch is becoming an icon and Rolex just keeps on growing. So over the decades, Rolex becomes a real status symbol, squeezing onto the wrists of the rich, the famous and the notorious. Athletes and movie stars, moguls and gangsters, every single U.S. president. Power brokers across the globe are wearing the this watch. Some are paid to wear it, some just love the brand. Usually a bit of both. And they help keep this brand at 30% market share for a very, very long time. 30% of the entire Swiss watch market. Rolex is the OG brand powerhouse. I would say just look at everything they do. Product marketing. Every timepiece has a story, which I'll talk about more in just a second. Customer marketing. Putting your name on a wait list and enjoying the journey. Brand marketing consistently ranked as a top 100 global brand. And FOMO marketing. Right. There's a reason you can't get the watch you want. It's a fashion flex that just happens to tell time. That's what this watch is. But it's also a great product. And it all started with a waterproof watch. This episode is brought to you by my one minute marketing roadmap, available@johndavids.com roadmap in 60 seconds, you'll get a custom report showing you how people are finding your brand, where you're losing them, and how to fix it. We used a decade of data from Influicity and layered in AI to give you a real action plan. It's fast, it's free, and it might just change your business. Go to johndavids.com roadmap and get yours right now. So I shared this story in my newsletter a few weeks ago and I asked you guys if you wanted the full podcast on Rolex and I got hundreds of responses. Y' all want to hear more about this brand and I'm happy to get into it. So let's start with the most counterintuitive part of this brand, and that is that Rolex sold 1.176 million watches in 2024, good for about $11 billion in revenue. But they did all that while actually turning away plenty of business. You see, Rolex is notorious for their waiting list. Not waiting list meaning when you come into the store to buy a watch, you, you'll almost certainly leave without a watch. Instead, they'll add your name to a list and tell you, thanks very much. We'll call you when we've got a watch to sell you. And that might be in Two months. It might be in six months, a year, we don't know. And it's really weird. You see, most companies would never, ever do this because it's just creating friction. That's all you're doing. And that's a big no. No unnecessary friction leads to missed revenue. You're literally abandoning the customer while they are ready to hand you their cash. Why would you do that? Well, let's look at why Rolex does it. So reason number one is the obvious one. Because you want what you can't have, right? Desire is built through denial, so they turn you away. Now you want it even more, you're begging for it. Okay, that makes sense. I get it. But there's actually a second reason this wait list works. You see, because underneath the wait is social proof. It's a signal to you that lots of other people are waiting for this product too. So it's gotta be good, right? And that goes way beyond a sales tactic. Social proof is biological. It's built into our DNA. It's psychological. It's also ancient. So think about it like this. Let's go all the way back in time, tens of thousands of years, caveman days. And picture that you're living in a tribe, and in that world, food is scarce, danger is everywhere, and survival isn't guaranteed. It's actually pretty unlikely that you'll survive. And in a situation like that, life as it is, you do a couple things. So number one, you stick with your tribe. And that's why, all the way till today, we have families, right? It's because we lived in tribes back then. That's how we live. That's how we stay safe. And number two, you take cues from other people around you. And this is where social proof begins. This is where it comes from. Ingrained in us since the very beginning, when everyone starts walking in the same direction, even if you don't know where they're going, you follow, Right? We do it all the time because maybe they've spotted danger or maybe they've found a new food source. When you see half the tribe staring up at a tree, you look up. Maybe there's honey up there, or maybe there's a predator up there. This was happening at the beginning of human existence. Now fast forward all the way to today, and this instinct is baked into our lizard brains. Except instead of using social proof for survival, we use it when we're thinking about what restaurant to eat at or what sneakers to buy or what school to send our kids to. One of the experts in this field is Dr. Robert Cialdini, professor of psychology and marketing and the author of the book is Influence, which is basically the bible on how persuasion works. So Cialdini defines social proof like this. He says, when we are unsure of what to do, we look at others to guide our behavior. We assume that if many people are doing something, it must be the correct thing to do. And Rolex milks this hard. They juice it. They juice it like Hollywood keeps juicing those Mission Impossible sequels. We get it. Tom Cruise saved the world. Move on. Seriously. I actually, actually love those movies. So look, Rolex milks social proof because it works. It works. And the wait list is social proof at its best. Now the obvious question is, how do you use this tactic in your business right now? Well, let's first assume that you're not Rolex. You don't have a global brand. You don't have $11 billion in revenue. You don't have 100 years of cultural cachet. How can you use this strategy and do it without risking sales? Because your boy JD definitely doesn't want you losing a dollar. So here are three ways you can pull it off right now. Number one, take what customers are already saying and just make it visible on your website. Don't just say hundreds of happy customers. Instead, show names, show logos and faces. Pull up screenshots of email threads and slack conversations and WhatsApp messages that you've received from from happy customers. The more real, the better. Number two, broadcast your sales. This is what I call real time social proof. So this means saying things like 12 people bought this product today or we just opened the second block of tickets because we sold out of the first block. If you're selling online, you can even show the sales happening in real time with one of those heat maps that shows the sales taking place in London and Sydney and Miami and Barcelona. All of this is real time social proof. And number three, you can introduce a wait list of your own. But do it like this. If you know you're dropping a new product in a month, just start taking orders now and say it's first come, first serve. At the very least, you're promoting what's coming up, which is a good thing. And maybe people will actually start buying it today, giving you their money right now. And don't be shy with this. Build your wait list. Use it to sell more stuff faster. That's the power of social proof. We do this kind of thing all the time for our clients at Influicity. And I can tell you it works. It works really well, that's why Rolex has been doing it for 100 years. All right, another little thread that I pulled from this Rolex story. The saga is the product storytelling. The mythologies they build around each watch. It's crazy. I'll give you three of the most famous ones right now, and then I'll tell you how to apply it to your business. Do it yourself. Let's start off with the story of the submariner. So in 1953, Rolex launches this new model. And it's not a fashion piece. It's really a tool. It's the first waterproof watch that goes all the way down underwater up to 100 meters. It's built for divers, underwater explorers, anyone who needs reliability below the surface. It's got a rotating bezel for timing your dives. It lights up so you can read it in the dark because it's pretty dark down there. It's got all the good stuff. So that's the product. And then 10 years later, in 1962, something happens that will take it to a whole new level. James Bond wears a submariner in the movie Dr. No. Everything changes. This watch isn't just for divers anymore. It's for danger. It's for the guy with a tux and a gun and a martini. He's calm and he's cool under pressure. Suddenly, this isn't a timepiece. It's a signal. And it says, I take risks. I keep cool. I handle chaos. Most people who own submariners today aren't diving, but every guy who puts on a Submariner feels like James Bond. And that's the myth baked right into the bezel. Let's talk about another one. And this one is really iconic. The Daytona. So Rolex introduces this model in 1963. And. And it's a racing watch designed for drivers, built with a tachymeter bezel, three sub dials, everything a pro needs to time their laps at 200 miles per hour. And at first, this thing flops. No one is buying it. And then a very special Rolex customer puts one on his wrist. His name is Paul Newman. And Newman is a Hollywood icon. He's royalty. And a real life race car driver, too. In 1963, he is the embodiment of cool. And slowly, the legend builds. People actually start calling this watch the Paul Newman Daytona. It blows up. Fast forward to 2017. Paul Newman's personal Daytona hit the auction block. And it sold for $17.8 million. Today. The Daytona says, I move fast, I win, I don't explain. And that's a hell of a story. I'll give you guys one more. This is the Explorer. So this one is also in 1953. A lot of this stuff happened in the 50s and 60s. That was really the heyday of the iconic making of Rolex. These two guys, Edmund Hillary and Tenzing Norgay, climbed to the top of Mount Everest. And on their wrists, of course, they're wearing prototype Rolex watches. And later that year, Rolex releases that model of watch and they call it the Explorer. It's made for cold weather, high altitude, rugged conditions, and the name is perfect, just Explorer. And what does this product say on your wrist? Well, it says, I do hard things. I go places others won't. I accept the challenge. All right, so you've got three killer products and stories to go with them. So let's zoom out. When most brands talk about their product, their minds go to features because that's how we all see our own products, as a bundle of features and functions. And companies talk about the specs and the materials and all that kind of stuff. But here's the truth. No one cares. No one cares about any of it. Rolex sells feelings. They make you believe that when you wear that watch, you become the kind of person who, who does legendary things. You climb Everest, you race Le Mans, you diffuse bombs in a tux. Those stories stick. So let's get tactical. How could you do this in your business? Well, here's a three step framework that I like. Marketing executives, business owners. If you are running a company and looking for a fresh perspective on how to grow that company, take a look at at Influicity. That's my marketing agency where we work with brands across influencer marketing, podcasts, social media, AI content, paid ads, and so much more. But don't take my word for it. Go to Influicity. Check out our case studies from all the amazing clients we've worked with over the last decade. That's inf l u I c I t y influicity.com and I'll see you there. Number one, attach your product to a moment. And, and that moment should actually be a picture in your mind. Think about it. When Rolex wants to say the submariner is waterproof, they do it with a picture. It's James Bond jumping off a bridge into water. And that's a picture you're not going to forget anytime soon. So ask yourself, what's a moment that you can attach your product to? If you sell sales software, maybe it's the moment that sales rep lands Their first hundred thousand dollar client. If you sell luggage, it can be the suitcase that took you to three countries in two weeks. Find the moment and tie it to your product. And that takes me to step two. Make your customer the hero. And this is where a lot of brands mess up. They want to make their product the star of its own story. But it's not. Your customer is the star of the story. The thing you sell is the thing that helps them become who they want to be. So show that. Let's say you sell drills. Instead of saying this is the best drill in the category, say this is the drill builders use when they've got to get the job done. Today you can show builders doing this and really dig into that story. Most importantly, you turn your customer into the character that gets the job done. That's what they want and that's what your product does. And number three, the most important part of it all. Repeat the story until it becomes myth. This is so important. I talk about it in my book, Marketing Superpowers. You've got to tell the origin story over and over again. Rolex doesn't whisper these stories in a brochure. They bake them into the ads, the displays, the product names, the associations, the auctions, the sponsorships, everything. And you can do it too, on the cheap. It doesn't have to cost you a lot of money. Tell your stories on Instagram, Facebook, LinkedIn, TikTok. Tell it in your newsletter, tell it on your podcast, on your website, on your packaging. Build stories into your products. Just like Rolex. Watch how much better they sell. So guys, there's one big idea that just keeps jumping into my head these days. And when I was researching Rolex, I just, I had this epiphany. So the idea is that artificial intelligence is changing everything. And you're probably wondering, okay, John, but what the heck does that have to do with Rolex? Well, this might be the most critical lesson I can give you today, so pay close attention here. Rolex sells a product that is functionally useless. It's useless. It tells the time, which is important. But we all walk around with these tiny computers in our pockets called phones, and they can tell the time more accurately than any watch. And I assume if you can afford a Rolex, you can definitely afford an iPhone or an Android. But let's be honest, iPhones are better. So why in the world would you even need a watch? Well, obviously the answer is no one's buying a Rolex to tell time. It's status, it's style, it's money. It's that bling bling on your wrist. We all know that. So I'll say it again. A Rolex is functionally useless. You wear it because of the brand. It means something to you and it projects your image of yourself to the world. And that takes me back to AI. You see, AI will make lots of things functionally useless. It'll turn plenty of stuff that's valuable today into a commodity. Why would I hire a lawyer when ChatGPT can give me legal advice in seconds? Why would I talk to a financial advisor when Claude can draft up an investment thesis based on all the knowledge in the whole entire world? Why would I read your newsletter or pay you to design my logo or buy your course when there are literally hundreds of AI tools doing all these things for pennies? And the answer is brand. Yes, brand. But not in the warm and fuzzy hoity toity way you're thinking about it. I mean, serious killer brands as AI can do more and more things. Customers won't choose you for the output anymore. They won't choose anything for the output. They'll choose you because of trust, because of comfort, because of your track record, because of status. They'll choose you for the feeling they get when they use your product and how others think of them when they use your product. When everything becomes a commodity, brand becomes the difference. And how do I know that? How do I know that beyond a shadow of a doubt, my friends? Because people still buy Rolexes. They buy Patek Philippe and Audemars Piguet and Richard Mille. They pay insane prices for a product that does nothing. Now, you can make an argument that this is unique to luxury or only things that rich people buy, but it's not. We all pay premiums for brands all the time, every day. If that wasn't the case, then the only products in existence would be the absolute cheapest things possible. And. And that's just not true. Walk into any store and there's different options at different prices for every single thing. Now, I'm not suggesting your product should do nothing. And I'm also not suggesting that your brand is going to be a $10 billion luxury icon. I'm just making the point that when industries get commoditized, brands win. That's how it's always, always been. Take that information and do with it what you will. But if I were you, I'd be looking at marketing and brand now more. And that's what I do every day. So I'm feeling really good about the future and all of you guys who listen to me here on this podcast, watch the YouTube. I want you to be right there with me. So let's do it. That's the story of Rolex. That's the story of a $10 billion luxury icon. Get my best stuff to your inbox@johndavis.com.