Why do some luxury watches fetch astronomical sums at auctions, far beyond their retail prices or perceived utility? While traditional advertising undoubtedly plays a role, new research from Cornell University’s SC Johnson College of Business points to another, often overlooked force—nonpaid media coverage—as a powerful driver of luxury watch valuation.
According to a recent study by Kim Claes, visiting assistant professor at the Samuel Curtis Johnson Graduate School of Management, and Frédéric Godart, associate professor at INSEAD, the way media outlets mention and frame luxury watch brands in articles and reviews significantly influences market dynamics and buyer perceptions, ultimately affecting how much collectors are willing to pay at auction.
Their findings, published in the Strategic Management Journal, are detailed in the paper titled “What Keeps the Market Ticking? The Role of Third-Party Audiences and Cognitive Embeddedness in Shaping Competitive Dynamics in Luxury Watchmaking.”
Core Concept: The Power of “Coreness”
At the heart of the study is the concept of “coreness”—a brand’s centrality within a network of media mentions. A brand with high coreness is frequently cited in the same media stories as other well-known brands. Surprisingly, the research shows that being closely associated with a group of frequently mentioned brands—even if they are not equally prestigious—can significantly increase a firm’s auction performance.
“Market interactions are cognitively embedded,” Claes explains. “Participants form opinions based not only on individual brand characteristics, but also on how brands are associated with others in public narratives.”
This shift from firm-level analysis to network-level positioning marks a departure from traditional marketing studies. It underlines how media ecology—the way brands are collectively represented in media—can enhance or diminish perceived value in consumers’ minds.
The Dataset: Mapping Mentions to Market Impact
Claes and Godart conducted a deep-dive analysis using media reports from January 2001 to December 2009, paired with luxury watch auction results from January 2002 to December 2010. By creating “comentions networks”—maps of how often brand names appeared together—they evaluated the impact of brand positioning in the media on auction price outcomes.
Key luxury brands analyzed in the study include Rolex, Cartier, Patek Philippe, Omega, and Tag Heuer.
The results were clear: the more often a brand was mentioned alongside other prominent names, the more likely it was to achieve higher auction prices—an indicator of increased consumer recognition, perceived exclusivity, and investment appeal.
Strategic Implications for Watchmakers
The research offers practical insights for luxury watchmakers looking to enhance their brand value—not just through product development or traditional marketing, but via strategic media engagement.
Favorable and frequent mentions in reputable media outlets, especially when clustered with other high-profile brands, can significantly enhance brand value and visibility in secondary markets, such as watch auctions.
Moreover, aligning a brand with a “core” group of well-connected competitors—rather than striving for complete differentiation—can paradoxically lead to greater consumer affinity and market performance.
“Our findings suggest that brands can benefit from a sort of cognitive clustering,” Claes notes. “Being seen as part of the luxury watch elite confers recognition that translates into higher perceived value.”
Beyond Luxury Watches: Broader Market Lessons
While the study focuses on watchmaking, its implications extend to other luxury and collectible markets—from handbags and fine art to cars and wine. In any market where status, visibility, and cultural narrative play a role in valuation, how media curates and clusters brand identities can influence market outcomes.
This highlights the importance of earned media in brand strategy. Watchmakers and other luxury brands can potentially boost brand performance by managing media relationships, investing in public relations, and understanding the editorial ecosystems that shape consumer awareness.
A New Lens on Market Psychology
Ultimately, Claes and Godart’s work underscores the psychological dimensions of consumer markets, where value is not only a function of product quality or scarcity, but also of social cognition and narrative construction.
“This research enriches our understanding of market behavior,” Claes concludes, “by showing how buyers are influenced not just by what a brand is, but by where it sits in the broader cultural conversation.”
In the rarefied world of luxury watchmaking—where heritage, status, and perception can mean everything—being part of the right media story may be just as important as the movement inside the watch.
