A descendant of the quill

When Emile Benjamin left J-Crew to become Assistant Manager of Fahrney’s Pens in Washington DC, he couldn’t quite figure out, initially, what motivated a customer to spend $4,500 on a David Oscarson pen, let alone the company’s ability to pay salaries and open a store front, on just the sale of pens. But as time went on, it became apparent to him that these pens were not just mere writing instruments—they had somehow transcended their functional use into becoming works of art desired by pen collectors across the United States.

“I saw a customer drop $9,000 on a Caran d’ ache pen,” Benjamin says. “And even though we do not sell $9,000 pens every day, the sale is still quite remarkable.”

The demand for limited-edition pens, a new product in the super-luxury goods market, is growing rapidly in the United States thanks in part to companies such as Montblanc, whose effective marketing efforts, have led to the spread of brand recognition and increased sales through out the U.S., European, and Asian Markets. Limited-edition pens, which come in ballpoint and fountain, are desired for a variety of reasons, with functionality not being a key reason among them.

The buzz all started when Montblanc introduced a ‘writers series’ line of pens during the 1990’s that celebrated the literary accomplishments of a 20^th century writer. In 1992 Montblanc launched a $600 limited edition ‘Hemingway’ pen, which came about when Montblanc purchased the license to use Hemingway’s name and signature from Hemingway Ltd, a company that was formed by Hemingway’s sons, Patrick, Gregory, and John. Even though Hemingway himself never used a Montblanc pen to write his novels—they were written in pencil, the 1930’s designed pen of an orange body and black cap, bearing the signature of Hemingway became a well sought after pen among collectors, and the demand for this pen remains strong today.

“Not everyone liked the orange and black style of the Hemingway pen when it first came out,” Benjamin says. “Some of my customers said that the design and color scheme of the pen made it look ugly, and refused to buy it.”

But when pen aficionados realized that Montblanc had only made a limited amount of these pens, demand grew, and one can only acquire the Hemingway pen today both in fountain and ballpoint, in ‘pre-own’ condition.

“Eighty percent of my customers who buy Montblanc are lawyers who wear the pen as a sort of status symbol,” Benjamin says. “They know Montblanc has a reputation for quality, and they also want a pen that is comfortable to write with.”

At Curtis Drapper Tobacco, a refuge for cigar smokers in Washington DC, tobacconist John Anderson lets his customers sign their credit card receipts with a limited edition

ball point Montblanc pen, as part of the store’s luxury experience.

“In the Montblanc writer’s series, I own a Hemingway, Alexander Dumas, and an Edgar Allan Poe,” Anderson says. “And even though I own some fountain pens, I won’t by them anymore because they are not as functional for me.”

Anderson says that if he allowed his customers to sign their credit card receipts with a limited edition fountain pen, then a beginning user could destroy the nib of the pen by bearing down as they would with a ballpoint. The nib is the part of the pen, which gets applied to paper in order to deposit ink. And it also represents the difference in price and writing quality between a good fountain pen and an average one.

“The steel nib was the biggest factor me when looking for a fountain pen to buy,” says Zeke Williams, a foreign exchange consultant at Travelex Global Business Payments.

“The nib on my Rebecca Moss fountain pen is smooth and yet strong enough that I can let others write with it and not worry about them damaging the nib.”

Zeke says that although functionality ranked high on the scale of his desire to own a Rebecca Moss, his main reason for writing with a fountain pen was that it was timeless art form lost in the fast paced world of a throw away culture.

But in examining the sustainability of the sale of limited edition pens in a down economy, Benjamin says that at Fahrney’s internet and catalogue sales drive the business, with the store being ranked as number three in terms of sales, but each revenue stream is pulling its weight.

“Of course sales are down due to the recession, but we are still doing pretty well because we haven’t had to lay anybody off,” Benjamin says.

The sale of limited edition pens continues to trend upwards thanks in part to companies such as Montblanc, Cartier, Parker and Delta. Montblanc plans to issue limited edition pens beyond its home territory of Europe to the American (its largest market) and Asian market.

Precious Time

For Oliver Robinson, acquiring a $10,000 Rolex Daytona was a huge accomplishment. To get such a timepiece, even with a dealer mark up, customers often must get on a waitlist at a high-end watch store, sometimes waiting up to six months for a watch.

“Sure, I could’ve gotten a lesser expensive, more accurate quartz watch,” he says. “But a quartz watch is just a chip and a battery with no true craftsmanship behind it.”

The mechanical watch, long thought to have been replaced by its more accurate rival, the quartz watch, is making a comeback in the United States, preferred by an affluent group of tradition-minded consumers. These watch enthusiasts are willing to spend a small fortune on a mechanical time piece that many consider to have out-dated technology, requires constant maintenance, and whose precision and accuracy level, pales in comparison to a modern quartz watch.

To Oliver, buying a mechanical watch is like purchasing a rare painting. “With fine art, the mastery is in the stroke of a brush,” he says. “In fine mechanical watch making, the mastery is in the engineering behind the movement inside each time piece.”

The ‘movement’, usually referred to as the motor of the watch, measures time either electronically, by way of a battery-powered quartz movement, or mechanically, powered by a mainspring.

It was the mechanical movement that attracted Omer Eisner, a 30-year old Senior Market Analyst, to mechanical watches. He inherited a 1950’s manual wind Vacheron Constantine watch from his grandfather, valued at between five to seven thousand dollars. Eisner dislikes any watch powered by a quartz movement.

“It’s nice to know that your watch has a very advanced mechanism, which is handmade and can run forever with proper maintenance,” he says, “not some made in China battery powered junk.” Eisner says that he also likes the fact that he does not have to change a battery in a mechanical watch. Eisner’s anxiety about changing batteries is felt by retailers in the watch industry.

According to Jorge Schefer, a watch specialist at Tiny Jewel Box on Connecticut Ave in Northwest, Washington DC, “A quartz watch is a cheap computer chip. You could buy it in a cheap plastic case or in a beautiful case, but basically, you are paying for the case,” he says. “A mechanical watch shows the origins of time---it has wheels and gears and it is powered by a mechanical spring.”

Schefer says that a mechanical watch is more valuable, and can last for a long time if maintained well as opposed to a cheap quartz watch that may fall apart more quickly. He also claims that while most of his customers come into the store already equipped with a general knowledge of mechanical watches, some still have to be educated about the purchase. He says most of his customers that are more interested in mechanical watches are male, who call themselves “purists”.

“My male customers like to buy Rolex because they are looking for rugged look, but with a refined feel,” he says.

But not everyone goes for the oversize look. At Liljenquist & Beckstead in Tyson’s Galleria, Mark Ferguson, a sales associate, says that women have a different take on oversize watches altogether.

“For ladies, everything is still in quartz because it’s hard to fit a mechanical movement into a small thin watch,” Ferguson says. “Men go for movement and most of the watches we sell are mechanical watches for men, but the size of the mechanical watch is still a turn off for women.”

According to LGI Network, a leading provider of retail measurement services and sales information for the fine watch industry, U.S. consumer spending---as determined by the federal governments Durable Goods Consumption Expenditures estimates---grew 6% in 2006 over 2005, and consumer demand for fine watches surpassed general consumer spending by 10%. In 2006, the U.S. fine watch market generated sales of $5.3 billion for men’s and women’s watches due in part to effective marketing, sales, and merchandising programs initiated by retailers and watch manufacturers. Women’s watches averaged a manufactured suggested retail price of $551, whereas the average price for men was $854. The sales of men’s watches grew by 12%, while the sales of women’s watches grew by 7%.

The craze over mechanical watches is starting to take off in the Washington Metropolitan area. At Torneau, a high-end watch store located in Pentagon City Mall Virginia, vintage watch manager Steve Miller examines the local area’s drive behind the mechanical watch industry. “Collectors, exclusivity, celebrity endorsements, and just plain keeping up with the Joneses are what drives the mechanical watch industry,” he says. Miller says that Panerai, a watch originally designed for the Royal Italian Navy, gained popularity when Sylvestor Stalone wore it in the movie Daylight during the late 1990’s, which helped to increase the price and desirability of the watch.

Miller says that in order to maintain exclusivity, some watch makers including Panerai produces a limited amount of watches every year, and that some vendors are not allowed to carry a particular mechanical model within a certain radius of another watch vendor. “Here at Torneau, we can carry a pre-own Panerai,” Millers says, “but are not allowed or authorized to sell new ones.” Miller contends that in the high-end watch industry, rules are put in place to determine exclusivity, which may be determined by how many stores carry a certain brand and how many are in stock.

Miller also says that most of his customers are less interested in the functionality of the watches than they are in the way they look. They can acquire the time from their computer or cell phone.

Industry experts say the rise of mechanical watches occurred during the 1970’s, when watch manufacturing companies in Switzerland enjoyed a significant lead in traditional mechanical watch making technology, dominating much of the world’s watch market with little or no competition. At the same time, a new quartz watch technology was developed by Swiss manufacturers and proposed to the Swiss mechanical watch making industry, but it was rejected because its electronic aspect lacked traditional watch making artistry. The new quartz technology was then proposed outside of Switzerland to investors who saw immediate advantages and capitalized on them. The quartz watch, which consisted of an electronic movement powered by a battery, was better on accuracy and less expensive to make than the mechanical movement, which involved many complications.

By 1970 a new wave of quartz watches were introduced into the watch market, and by 1978, quartz watches surpassed the mechanical ones in terms of sales, popularity, market share, and innovativeness. As a result, the Swiss watch manufacturing industry fell into an economic crisis that dissolved many Swiss brands, which resulted in a reduction in the size of the Swiss watch industry, and the loss of highly skilled craftsmen who were out of work.

In an attempt to revive the Swiss mechanical watch industry, a Zurich engineer by the name of Nicolas G. Hayek founded the Swatch group in 1984 by introducing a watch called the Swatch, a mass produced colorful quartz watch that was durable and affordable, and also well liked around the world. Hayek used some of the profits earned from the sale of Swatch watches to purchase declining Swiss mechanical watch companies such as Glashutte, Breguet, Jaquet, and Blancpain. He was praised as the savior of the mechanical watch industry, and also the one instrumental in a broader revival of interest in mechanical watches.

Hayek is not the only tradition minded, heritage-driven connoisseur. Ron Parisotto, Assistant General Counsel for Choice Hotels, bought a Ulysee Nardin chronometer watch because it was the first marine chronometer designed for the world Navy. Parisotto says that he wanted a unique Swiss watch that was not well known to the public.

“I like my watches to be understated, but very classic.” Parisotto says, “I don’t like loud, and unlike many guys who buy, say a Rolex for shock value, it’s just fine by me if you don’t know of my watch.”

Parisotto also says that he likes the fact that Ulysse Nardin’s watches are handmade and not massed produced. This fact he says is what makes him ‘tick’.