INSIDER VIEW: Neglect perception at your peril

I was once told by someone supposedly well-versed in such matters, that people make buying decisions based on the ‘three Ps.’

The three Ps that he was referring to were: Price, Product, and People.

The first of these is the most self-explanatory. It’s a truism as old as time itself that the cheaper something is, the greater will be the demand for it, and vice versa.

There are exceptions to this in economics at both extremes of the wealth scale. Veblen goods are those at the highest end of the luxury scale (supercars, penthouse suites, designer clothes, etc.), which are largely being bought for inflated status purposes, and so the demand for them goes up even as the price increases.

On the other hand, Giffen goods are those that are bought more if the poor get poorer. If those on the breadline take a further financial hit, then they’ll cut back on ‘luxuries’ like meat, and instead buy more affordable staples such as rice and potatoes.

Anyway, these academic outliers aside, the effect of price on demand is well-established.

The second P almost largely speaks for itself. If item A is more durable, more technologically advanced, and made from higher quality materials than item B, then it will sell more (all other things being equal). This is why manufacturers across all sectors invest so much in research and development and product design. If you’re selling people snake oil, eventually you’ll get found out.

The third P is the one I always found the most interesting. The role that individuals can play in helping the sales process is intangible but crucial, especially the higher up the price ladder you go. Being served by a charming and knowledgeable sales associate in Walgreens will almost definitely not influence my decision to return to that store for my loaf of bread the next day. But if I encounter the equivalent of this person in Bergdorf Goodman or a Fifth Avenue boutique, then it’s a totally different story. It could well be — and often is — the key driver in me choosing to purchase, and certainly on my decision to return to that store next time. 

The problem I have with the three Ps is what they miss out. They are incontrovertible factors in influencing buying decisions, no doubt. But the more time I spend in the watch industry — 15 years and counting — the more I see the value in two other Ps: Perception and Place.

Perception is where marketing and communications come to the fore. And if the watch industry is not world-leading in this department, then I’d love to see which industry is. Engaging storytelling, multimillion dollar sports sponsorship, and visibility across every media platform imaginable — print magazines, billboards, and digital. The combination of all this chips away at the subconscious (or sometimes the conscious) of the end consumer, helping to create the perception that we really need to buy a watch, when of course we don’t.

And last but not least, I am increasingly in awe of the value of the places that watches are bought in. It’s one of the remaining superpowers that physical retail stores have over e-commerce. When the right environment is created, a customer’s propensity to purchase is so much higher. Yes, a glass of champagne is nice, but it’s so much more than that. It’s the attention to detail, the clean lines, the brand adjacencies, the flow, and the design. 

I imagine the money spent on these things by the greatest watch retailers out there is astronomical. But the more exposure I have to world-class luxury stores, the more convinced I am that it’s worth every penny.

This article first appeared in the February 2026 edition of Watch Insider.