Swatch Case Study Reponses

Marketing Strategy

Swatch Case study Reponses

Q1: Why was the Swatch so successful?

In Nicolas Hayek's own words, the Swatch brand strives to convey a "strong, exciting, distinct and authentic message" to the people. Based on the information presented in the case study, we can see that the underlying passion in delivering this message is not just a superficial marketing blitzkrieg to influence the potential customers, but reflects the fact of a company and its people hungry to deliver a product that the current and potential customers are craving for, and at a price that is affordable and approachable by almost everyone.

The organization's commitment to fulfill this pledge was simply astounding. Starting with the key element of the design, which was a result of creative energies of over 3000 artists, architects and industrial designers to the constant learning about the current fashion and cultural trends and complete vertical integration of the production processes, and finally culminating in marketing campaigns that were designed to capture the imagination and fantasies of the people, the whole process was a model worthy of emulation by other companies. In addition, the unique distribution strategy adopted must have also probably played an important role in the success of Swatch. The Swatch brand was deliberately kept out of the jewelry and other expensive watch stores, where watches of several categories were traditionally sold; and instead sold in other outlets like mini boutiques and "swatch mono" stores (typically franchises) where it carved itself a separate and unique identity.

The diversity of styles available to suit any occasion or event and their intriguing nature should also have been a critical factor in the success of Swatch. For example, the Google search engine lists 736 results for the search term "swatch watches for men"; the same engine also lists "9936" results for the search term "swatch watches for ladies". Browsing through the first few pages of these results gives us an insight to the astounding diversity of very attractive and boldly styled watches.

In summary, compared with the rest of the industry's focus on price and quality, it was the unique focus on delivering a strong emotional message through the design of its watches that appeared to be behind the huge success of Swatch.

Q2: What elements of the original Swatch marketing plan were most critical to the success? Given the huge demand, did the company make a mistake in not raising the price for some of its styles?

One of the most important aspects of the marketing plan was to convey to the people, the message of a strong emotional connection to the brand, taking into accounts the cultural dynamics and the hunger for innovation among its young customers. The result of such a framework for marketing campaigns, was that Swatch always came up with unique, unorthodox promotional stunts that instantly created a buzz in the public. Though the company spent double the watch industry's average in advertising, the goal of the marketing campaigns was never to inundate the air waves with commercials reinforcing the Swatch brand, but to deliver a consistent, bold and exciting message. Traditional watch brands would typically advertize via a full page classy advertisement in newspapers targeting a narrow, upscale demographic whereas Swatch took a uncommon approach of spending it on television advertisements heavily (they were among the top 100 of the European advertisers). Such was the importance attached to the public communications interface, that the CEO Nicolas Hayek, would personally review every such release before it was released to the media. The level of intensity associated with the process of creating such messages was amply demonstrated in one of the campaigns that decided to produce and hang a giant swatch watch outside the tallest skyscraper in Frankfurt, Germany. The essence of this promotional stunt, though considered outrageous, was to convey two aspects of the Swatch brand: Swiss for quality and a low affordable price.

The introduction of the Swatch club which quickly swelled to more than 50,000 members in under a year was another unique approach of the company in getting close to the customers. Establishing such new channels of communication with the customers enables eager and loyal customers to become "virtual salesmen" for the company, as they become a catalyst to the effects of the marketing campaigns. Needless to say, this also boosts customer loyalty significantly.

Finally, the decision to use non-traditional distribution channels was another innovative strategy that must have captured people's imagination. For example, selling the "veggie" line of swatch watches in vegetable and fruit markets was totally unheard of in the watch industry, but must have attracted people's attention instantly.

Last but not the least, the marketing campaign strived to convey the message of a swatch being a "joy" of life that can be worn for every occasion and not just another watch that reflected