Cheaper the Better?

SELLING & MARKETING

The theory of obsolescence, which puts the sales appeal in new models of everything from autos to toasters, has finally hit U.S. watchmaking.

Instead of investing in one expensive "lifetime" watch, more and more people now buy inexpensive but serviceable watches, throw them away when they need repairs -or a more attractive model hits the market. Sales of low-priced ($15 and under) watches climbed from 6,000,000 five years ago to 8,876,000 last year, now hold 52% of the market. The company leading the march: U.S. Time Corp., whose $6.95 to $17 Timex watches have captured almost 23% of the total market.

The other side of the dial was shown last week by Elgin National Watch Co., the nation's biggest fine watchmaker, which makes some 200 models in a $34.75 to $150 price range. For 1957, Elgin reported a net loss of $2,442,076 v. a $671,380 profit the year before. Sales were off 26% to $31.1 million, and President J. G. Shennan said solemnly that he could not predict "an immediate return to profitability."

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