Case Study: Swatch and the Global Watch Industry International business, repositioning strategies, marketing, management issues, and recommendations for growth.
1638 Words7 Pages
The Swatch Group had many early on successes due to repositioning strategies and a boost from acquisitions. On the surface, the Swatch Group was the world's leading manufacturer of watches in the late 1990's. They had 14 percent of the world market share and it appeared that gross sales and net profits were on the rise; however, under the covers, it was a much different story. Swatch was facing a myriad of issues that needed to be resolved in order for success to prevail. Management issues were plaguing Swatch; multiple key figures stepped down from the board in the mid 1990's citing the CEO's inability to listen to his staff. In addition to the management issues, Swatch was also facing fierce competition in many market…show more content… Worse of all, consumer perception was that Swatch was a fad. Swift decisions need to be made to reverse this before the brand becomes part of a MTV or VH1 "I love the 90's" television show. Luckily, most of the decisions to be made regarding product mix have very little impact socially and ethically.
Omega (part of the Swatch Group portfolio of brands), was facing a similar demise in the early 1990's and successfully repositioned itself and became a major profit driver for the group. It achieved this by carefully selecting its marketing programs and drastically trimming its product line from 2,500 to 130. This strategy needs to be applied to Swatch, which focuses on the basic and middle-priced market. This is supported by the fact that the number of resellers dropped from 3,000 in the early 1990's to 1,200 in 1998. Swatch needs to apply a SWOT analysis and determine which product lines are successful in this market space and drop the remaining products. In addition, the Swatch Group needs to look at their consumer base and determine if it would be profitable to launch a new product line that captures past consumers who have now progressed to the next stage of their lives and are desiring a more expensive and sophisticated watch. A marketing campaign needs to be chosen that helps attract new consumers in the basic and middle price market focusing on the smaller number of brands and a separate campaign should be created that focuses on