I think you are missing his point - the items are desireable because of the brand. The stories, the movie stars, the songs and so on.
They don’t possess a universal, objectively valuable beauty that motivates the desire. If they did, fakes would be equally desireable and they are not.
I have a set of very expensive hand made japanese irons (golf clubs). I assure you I did not buy them from social influence or clout. In fact, nobody ever really sees them except me. I bought them because the craftsmanship and how truly beautiful they are. They make me smile.
You're confusing the price of something with how much it costs to make it. Prices are just a made up number. Hopefully, the amount someone will pay you for the watch you made is more than it costs you to make it, and you have a sustainable business, but the funny thing about capitalism is that is not at all guaranteed. If the company wants to juice sales, they'll have a limited time discount. Or how about when the company is bankrupt and out of business? Then theres a fire sale and the price of something is pennies on the dollar. So they could sell the watches for $200, or they could give them away for free, or they can charge $100k, or they could barter for them. It's all a matter of business.