The Swatch Philosophy
Hayek came up with a concept that combined disposability, affordability and reliability, resulting in a funky, no-frills watch for every occasion.
The Swatch Strategy
The strategy consisted of a marketing mix of the four P`s:
- Product
- Price
- Place
- Promotion
Product:
The goal was to offer a large assortment of Swatch watches that would be able to follow new trends. The fully-automation of the production lines made it possible for the company to adapt quickly. Each watch should be unique, yet, at the same time, based upon the same kind of watch. Swatch brings roughly 140 new watches to the market each year. They are designed in Milan, where the designers are inspired by the newest fashions, trends, and cultural atmosphere.
Price:
The fully-automated production lines not only made it possible to rapidly respond and adapt to new trends, but also meant that the company could save on personnel costs. Furthermore, Swatch watches were sold directly to customers via so-called Swatch-Shops, thus cutting out the ‘middle man’ and thus reducing the retail purchase price.
A standard Swatch watch has remained around 50 Swiss-francs. Occasionally, a limited collection is produced in order to raise the prices during auctions.
Location/Place:
The watches were sold in department store, boutiques, sporting goods stores, traditional watch stores as well as in Swatch-Shops. Kiosks and discount store were excluded because they would have damaged the brand’s public image. The watches were sold in so-called store-in-stores, where a smaller section or department was exclusive for the Swatch brand. These departments were intended to radiate a cheerful, festive and artistic atmosphere – everything that the Swatch watch embodied.
Nonetheless, the number of retail outlets should remain relatively small. In the words of the Swatch AG: “As many sales as possible with the least number of points-of-sale”.
Promotion/Advertising:
The Swatch AG’s advertising campaigns are characterized by innovative fashion products, bright colors, and striking design. Events are constantly being planned and often take place at unusual locations, e.g. at the Scottish Loch Ness.
Hayek can often be seen with famous individuals such as Cindy Crawford, Dean Barker, to name but a few. Public relations, special events and unconventional promotional strategies are very important to the Swatch AG. Swatch’s innovative and sometimes even outrageous promotional gags, for instance, the 165 meter tall, 13.5 ton giant Swatch hung from the German Commerzbank in Frankfurt, were not uncommon.
Thus, it came to be that the Swatch AG grew and grew and has now occupies an important place in the Swatch Group next to the luxury brands like Breguet and Omega.
