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A Creative Marketing Strategy for Swatch

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    Swiss Watch has always been known for luxury watches and an icon for elegance, poise and luxury. Then the company decided to create a diversification program for their products wherein they changed the name into Swatch (Swiss and Watch combination) and their aim is to become a fashion enterprise. The company’s new life meant a difficult struggle with Asian competitors. And their new market presents a low priced watch as a fashion accessory. They have implemented the production of electronic watches.

    Before, Swatch avoided department stores and they only sell their products in jewelry shops. Their styles were no longer in touch with consumer demands therefore, they lost a huge amount of market share at the lower end of the market. The merge of Asuag (Longines) and SSIH (Swatch, Omega, Tissot) was the company’s first response to Asian competition. It was a sensible move because Asuag is technologically equipped while SSIH possess better known brand names.

    The objective of the diversification program was to sell Swatch all over the world and to recapture the lower end of the market, develop a product that is inexpensive to manufacture, low-priced, durable, technically advance and stylish at the same time. The marketing strategy of the company is to make watches as a fashion accessory and to target the fashion oriented market of 12 to 24 years old, and to compete on price basis, performance and accessory. The company’s product design is a clear product concept based on: young and trendy; active and sporty; cool and clean high style and; classic.

    They produce 12-small faced and 12 larger. Product lines are out in the market in a restricted amount of time depending on the design concept. Each line has a distinctive theme wherein new models are introduced in the market four times a year according to seasons and they also produce limited edition line. The concept that they implemented on their product is that: the trendier, the shorter it will be available in the market, the more classic, the longer it stays in the market.

    Advertising mediums are chosen based on the product concept. Products were originally distributed in fashion outlets but ever since the diversification program, they started distributing products in upscale department stores (Blooming Dale’s, Sak’s Fifth Avenue, Macy’s) but they still avoid distribution in drugstores and mass merchandising. The company’s VP for Marketing who’s responsible for advertising, marketing and promotion is the 27-year old Steve Rechtscahffner and the advertising director is the 31-year old Nancy Kadner.

    The two made use of colorful and humorous print ads and multi-page ads in Vogue and Rolling Stone magazines. They also made use of concert and event sponsorships, music videos and MTV’s and rap & graffiti artists. The below $50 watch segment is the most competitive and large market of all US watch sales. Swatch had the free reign over plastic fashion watches which were also known as the “cheap chic”. The company had also experienced to be a victim of the gray market wherein fake Swatch products are sold to the market.

    Because of the incident, the company spent $50,000 to maximize control over the sale of products. The company has been successful through the years because they have been very brave in facing a change in their organization. They have embraced a change in their product in order to capture the lower end of the market. Their aim is very significant in their success because the said market is comprised by a large percentage of buyers in the industry.

    As they have captured the said market, their sales have appreciated and that this gave the company the opportunity to know and understand their new consumers. The delegation of younger executives gave the company a great edge when it comes to advertising creativity and it made them reach the target market effectively because as part of the younger generation, they have this advantage to know the wants of their consumers and understand what they want from a product and how do they want to see the products in the advertisement, the right color, representation, music, etc.

    Employing concerts and Music Videos as a part of their advertising mediums are very significant and effective in being able to reach the target market and make them feel that the product is a part of their lives and it symbolizes how fun life can be. Through this case, I can say that Swatch has a very big chance of becoming a total fashion enterprise. Challenges and obstacles may come handy but I’m sure they would be able to fix it because they know what to do to fix it (just like what they did in overcoming the gray market).

    What I learned from this case is that when you distribute your product and introduce I to the market you have to limit your supplies so that the hunger of your market for your product won’t run out. Always keep your designs up to date and make your consumers look out for the next designs of your product. Make them curious about what your product would look like on the next term. De Ramos, Jan Alvene BSBA – Marketing This case is all about the success story of Swatch in the watch industry.

    The company had been able to taste success through being able to diversify their products from a line of exclusively expensive watches that only caters to the upper class market to being able to come up with products that would now cater to a large percentage of market, the lower class market. They were able to successfully compel with the demands of their new market and at the same time with the demands of the new competition.

    From selling their watches exclusively in jewelry shops, the company with the diversification program started to distribute their products to upscale department stores. Even so, they still avoid drug stores and mass merchandisers. The objective of the company’s diversification program is to be able to sell their products worldwide at a low price but is still durable, fashionable, technically advanced but is produced at a low budget, capturing the lower end market.

    The marketing strategy of the company is o be an enterprise of fashion, targeting the market of 12 to 24 years of age belonging to the lower end of the market competing when it comes to price basis, accessory and performance. The designs of the watches vary according to the four categories that they have come up with: young and trendy, active and sporty, cool and clean high style, and classy. They also come up with limited edition lines, and they come up with different lines and designs of their products four times a year according to season.

    They distribute their products in upscale department stores of 5,000 locations, still avoiding drug stores and mass merchandising. One thing I learned from the company is to not overwhelm and flood the market with your product, because in doing so, you might lose them because their hunger for your product would run out. They did not have any problems with the production of their new line because the company has a flexible capability in making changes with the designs of their product every term without adding dramatic costs.

    This strategy is very essential to the company for them to keep on running in the race. In this case, I have learned that one should never be afraid to implement a complete change in the company. They should be able to view change as a new opportunity for the company to grow, mature and learn. With Swatch’s diversification program, I have been able to absorb that financial capabilities should always be flexible so that in cases of any change, improvement, or even solving issues would not be a problem or an obstacle.

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    A Creative Marketing Strategy for Swatch. (2017, Mar 17). Retrieved from

    Frequently Asked Questions

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    What is Swatch marketing strategy?
    Marketing Strategy of Swatch analyses the brand with the marketing mix framework which covers the 4Ps (Product, Price, Place, Promotion). There are several marketing strategies like product innovation, pricing approach, promotion planning etc.
    Why is Swatch so successful?
    Swatch saved the Swiss watch industry by boosting confidence in Swiss watchmaking. The creative marketing strategy was the key to their success. The use of fashion to sell watches was no longer a byproduct of watches, and the people in the company invested money on R&D, design, manufacturing and retailing.

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