Swatch

by Nicholas Martin,Johnson Liang,Joseph Pecora,Rasheequr Rahman,Kim Sion,Xihua Wang

Swatch History

• 1950’s - Specific craft of each watch• 1983 - First swatch made• 1993 - Swatch, best seller in history of watch making

(sales of over 100 million units)

Product Design and Product Line Management

Doubts and questions: Is it possible to manufacture in Switzerland?

• More than a watch: A strong message with an emotional connection

• Various bold colors and designs to choose from

What about the costs?

• Minimize labor and maximize automated production

• 91 to 51 individual parts; helped bring down costs to SFr 10

Pricing Strategy

• A Simple and Clean PriceFactors to Consider:• Objective• Market Share• Other Company Brands• Result

Swatch’s Fall

• In 1983, SSIH and ASUAG were losing millions of dollars

•Switzerland’ watch unit share fell to less than 15%

•Bankruptcy

How did Swatch overcome?

• These two companies merged

•Nicolas Hayek assigned as a CEO

•One profitable, growing, global brand in every segment-including the low end

→ This is the key strategy when introducing a new sub-category !

Smart Watch

•What is Smart Watch?

– A new category of watch that can be linked with Smart Phones and functions as MP3 player, camera, and other entertainment.

-But, it does not seem to be a big success.

What should Smart Watch companies do?

•Product marketing mix

- need a variety of designs

•Promotion marketing mix

- improved and unique advertising

What should Smart Watch companies do? Cont’d

•Pricing marketing mix

- affordable price

•Place marketing mix

- distribute it in the places where there are a lot of potential consumers. E.g. Big cities have a lot of smart phone users.

Swatch Concept (Question 2) • Public view started to change; prefered watches with quartz technology.

• Swatch concept received with mixed feelings. -Waste of resources-Hurt brand image

• Worked well as it increased revenue and brand popularity

Watch & Smartphone (Question 3)

• Both made for individuals

• Day by day uses

• Both benefiting from technology progress

• Both have a full-scale product line.

Smartphone

• Changed the way people interacted with technology and packed all-in-one products

- Not just talking and texting - Internet, media, camera, and education are all incorporated

Smartphone

Interactive TVHD ScreenFlat TVFrom CRT Televisions to Flat screensApp, such as weight control

Smartphone

• New designs and features - Tons of new features and looks of smartphones. - New collections, and color design, like Iphone.• From Luxury to a Standard - Different versions and levels of smartphones for customers to choose

Apple

• Apple makes smartphone to a whole new level. - Touching screen - Reformed the App Store - Leading and promoting the development of the smartphone industry - Changed the way people think about smartphones