Rolex has a long history. They gained a reputation for fine watches when many watches weren’t very reliable. Most of their watches are officially certified as chronometers, which means that they are accurate within certain limits. And don’t let the plastic crystals fool you. A lot of watches used them. They are not as easy to break as glass. (There weren’t always synthetic sapphire crystals, after all.) Omega uses an acrylic crystal on their Speedmasters. Rolex also developed the Oyster case, which is still used today. The Oyster case was a landmark in the making of waterproof watches (as was the waterproof crown). The cases are also quite rugged. I’ve seen Subs that have been used for their intended purpose – diving. One was missing the bezel and was very scratched. It still worked.
Rolex also made an effort to build its reputation. When Comex needed deep diving watches, Rolex offered the Sea Dweller (which was and is a more rugged Submariner with a helium release valve). Rolexes also found their way on to the wrists of explorers. (There is a model called the Explorer, which I believe was given to a Himalayan expedition – but I’d have to look up the details, and my book is in storage.) People began to associate Rolex watches with mountain climbers, scuba divers, pilots… adventurers. Rolex watches proved their reliability and ruggedness. They also looked good. Like many people who drive SUVs or wear team clothing but don’t go offroad or play for the Chicago Bulls, they wanted people to think they were “adventurers”. A Rolex gave them a certain cachet. Hey, James Bond wore a Rolex.
Especially in the 1980s, people were buying Rolexes as status symbols to go along with their BMWs. Everyone seemed to have one. It worked for a while, but once they became common (and at just a few thousand dollars, they are within reach of many, many people) they no longer stood out. Besides, a cheap digital or quartz watch keeps better time than any mechanical watch can. And let’s face it: An Oyster is an Oyster, no matter how you dress it up.
Nowadays the “hip” watches seem to be things like Tags. Newer, hipper watches have the “bling bling” factor. They’re different from each other. People don’t seem to care so much about the mechanics of a watch as long as it looks good and doesn’t break. Why spend the bucks for an automatic when you can get a quartz that only needs a battery every couple of years?
And since “everyone” has a Rolex, people who have “made it” tend to buy more expensive watches to display their wealth. They believe that a Patek shows that they have more taste than a Rolex.
But Rolex is still living on its reputation. People are still paying the prices. If the people who buy Rolexes thought they were too expensive, then they’d buy something else.
And Rolexes are not “bad” watches. They work very well. It’s true that you don’t have the “hand craftsmanship” when the movements are made by machines, but that doesn’t bother people who buy cars or other things that are made by automated processes. And let’s be honest; people are often offended by things that others have. I use my Cherokee for towing, camping, carrying my kayak, etc. And I’ve been known to go offroad in it to places where 4WD is necessary even though I live in the city. But it’s automatically “bad” because there are a lot of people who buy SUVs as fashion statements. So a lot of people will say that people who buy Rolexes are idiots because they can get a shinier watch that has more functions and keeps better tims for less money.
Whatever.
I like the classic looks of my GMT II and Subs. I didn’t buy them to impress people; I bought them because I like them. So what if they’re not “hip”? I don’t care. My Rolexes are not “high-class watches”. They’re just watches that I like.
So to answer Keeve in a nutshell, they got their reputation from the people who used them decades ago. An acrylic crystal is not a sign of cheapness. They’re more expensive than a lot of watches because automatic watches cost more to make than quartz watches, and because Rolex is still trading off of a reputation that IMO belongs to another era.