CASE STUDY

ON
swatch watch

Starting from the birth of swatch. The ups and downs

came to it. And about an changing era. And a mighty
heart to tackle with this changes.
 Biggest watch manufacturer in the world.
 Formed in 1983
 Founded by Nicolas Hayek,led by G.Nicolas

Hayek(son of Nicolas Hayek)

 Gross sales 6.14 billion CHF
 Swatch Group has around 25000 employees.
 HISTORY
 Swiss dominated the watch industry because of their centuries long
history of jewelry making expertise.
 “ MADE IN SWITZERLAND ” lable was a global seal of a quality,
status and prestige.
 During 1945, Swiss accounted for 80% of the worlds total watch
production and 99% of US imports.
 During 1951, the introduction of TIMEX launched low cost mechanical
watches that used hard alloy metals instead of expensive jewels.
 TIMEX watches were available with the price ranging between $6.95
and $7.95. And the watches were disposable type.
 During 1970s Japanese manufacturers like SEIKO, CITIZENES
expanded over the Asia and tried to cover Europe and North America
also. Which declined the share of swatch from 80% in 1946 to just 42%
in 1970.
INTRODUCTION OF NEW QUARTZ TECHNOLOGY
 Made use of quartz and integrated circuits
 Provided Accuracy, more sophisticated functionality,
more features like ‘day & time’, Digital display, Analog
watches.
 Cheaper in cost of manufacturing.
 A wide Price range, starting from $8 to $20, today even
below $5.
 FREE FALL OF SWATCH
 Swatch was only concentrating on production of high end mechanical watches
and was not interested in adopting quartz technology, because swatch was of
the view that this technology was unreliable, unsophisticated and not up to
Swiss standards.
 Japan watchmakers captured whole global market with quartz watches at rock
bottom prices and Swiss watches found itself unable to compete.

Year
Growth
Rate
1983 33%
1984 33%
1985 100%
1986 50%
1987 4%
1988 0%
1989 0%
 HAYEK’S STRATAGES
 Take over of SSIH and ASUAG
 Concentrated on adopting new technology and to create a new range of
pricing.
 Focused on the Italian Customers who were crazy for fashion and
looking for something innovative.
 Appointed artists, architects, designers. Proposed more than 3000
designs. Introduced different designs for different segments of
customers.
 First watch to introduce see-through watch and scented watches
 Introduced a new range of price in three price segments.
 Created a swatch collectors club for its fans.
 Adopted world class distribution strategy. Introduce an unconventional
retail approach that created many non-traditional points of purchase.
 ANALYSIS

Inthe Mid-seventies, the Swiss watch industry

was in the midst of its worst crisis ever.

Why ?
 Major problem with swatch was rise of Quartz
technology. Japanese companies like CITIZEN got
floded over whole of the market with this technology.
 Marketing strategy were not up to the mark with
customer’s need and value for the money.
 No artistic designs.
 High range of price.
 This lead to a big free fall of swatch group.
 SUCCESS STORY
 Unique Adds campaigns.
 World class designs, explores 140 designs every year.
 Aggressive & penetrating strategy.
 Watches for everyone.
 Different R & D and Technology.
 Swiss club.
 Radical innovations in design, automation and assembly
as well as marketing and communication.
 Runs 24 x 7
 Efficient designers were adopted.
 Considered consumers approach .
CONCLUSIONS
INBUSINESS YOU HAVE TO KEEP ALL
OPTIONS OPEN
TECHNOLOGY ADOPTION FOR QUALITY
AND PRICE IS MUST.
BUSINESS STRATEGIES SHOULD BE
REVIEWED EVERY QUARTER
COMPETITIORS HAVE TO BE TAKEN
CARE OF
WIDER CUSTOMER BASE IS IMPORTANT
 THE WATCHES NEEDED TO BE
ATTRACTIVE, CHEEKY AND GOOD FUN,
DARING IN DESIGN AND
AGGRESSIVELY PRICED, WITH HIGH
QUALITY AND INNOVATIVE FLAIR. THE
SWATCH WATCHES WERE HIGH-TECH
AND CAME IN A VARIETY OF FASHION
AND ART DESIGN.