Citizen Watch Forces Price Increases For Sale of Watches on Internet

On November 22, 2006, Citizen Watch Company of America announced that, effective December 1, 2006, all Citizen watches sold on the internet by authorized Citizen dealers will be subject to a maximum discount of 40% off the retail price.

New models, models featured in advertising and other "high profile" popular models will be subject to a maximum discount of 25% off retail. Citizen has earmarked over 175 models for inclusion in this 25% maximum discount list.

I did a quick check of the top 25 selling Citizen watches on Amazon.com and found that 15 of these models are on the 25% list. Currently, these watches are being offered on Amazon.com for approximately 50% off retail.

For example, the Citizen Men's Calibre 2100 Titanium Watch AV0021-52H, which has a retail price of $600 and is being offered for $309 will be at least $141 dollars more expensive on December 1, 2006.

One of the most popular models of all time, the Citizen Men's Skyhawk Eco-Drive Chronograph Watch #JR3080-51L, will go up in price by at least $142 from the current price of $214 to $356.25.

I will be very interested to see what happens on December 1st. Citizen states that they are taking action "necessary in order to enhance and preserve the image of the Citizen brand". Time will tell whether or not this action will have the intended effect.

Personally, I believe this is a reaction by a large, multi-national organization that still does not understand how commerce is developing on the internet. Many companies still perceive watch sales on the internet as some type of flea market, street vendor environment.

Actually, e-commerce has revolutionized the hard goods industries and the finest example of that is Amazon.com. Citizen, Seiko, Casio, Timex and other manufacturers of inexpensive quartz movement watches are producing commodities. Sales of commodities are subject to the influences of demand. If Citizen increases prices by 50%, I would expect to see a relative drop in demand unless all of the other watch manufacturers choose to implement the same price increase.

If you are thinking about buying a Citizen watch, you might want to do it before December 1, 2006.

Click here to see Citizen watches listed on Amazon.com

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