Swatch Case Study
1.
What do you think has been the contribution of the marketing function, the product design function and the operations function to the success of Swatch?
Please explain in sufficient detail.
The Swatch brand launch in the 1980s was marked by new and great styles and designs. It was originally intended to regain the market share that was lost to Japanese manufacturers. The combination of marketing and manufacturing expertise, and stylish product design was able to restore Swiss made watches as major players in the watch industry. Swatch watches are manufactured in Switzerland, which has one of the highest labor costs in the world. But because efficient manufacturing operations, like building the quartz mechanism directly into the plastic case, and using less components (less than half the number in most other watches), the company was able to produce high volumes at low costs. Fewer components also meant that the manufacture of the watch could be fully automated.
The company has a very effective marketing strategy. It has different varieties of watches for different segments (according to age of their customers). It makes sure that it has a series of new watches with different styles for every season (Spring collection,
Summer collection, etc.), every special occasion and every significant world event (like the Olympics and the World Cup). Swatches used to be available in every store at affordable prices (to re-capture the lost market share), but now the company has a different strategy to keep peoples’ interest up beyond the 80s craze it has created. It is now doing the opposite of what it did decades ago. This is due to more than one factor including the artistic design (which are sought after). Swatch capitalized on the idea of product line extensions and variations. It has also tapped famous personalities like John
Lloyd Cruz and Anne Curtis (which are effective celebrity endorsers) to represent the company. Product design is
What do you think has been the contribution of the marketing function, the product design function and the operations function to the success of Swatch?
Please explain in sufficient detail.
The Swatch brand launch in the 1980s was marked by new and great styles and designs. It was originally intended to regain the market share that was lost to Japanese manufacturers. The combination of marketing and manufacturing expertise, and stylish product design was able to restore Swiss made watches as major players in the watch industry. Swatch watches are manufactured in Switzerland, which has one of the highest labor costs in the world. But because efficient manufacturing operations, like building the quartz mechanism directly into the plastic case, and using less components (less than half the number in most other watches), the company was able to produce high volumes at low costs. Fewer components also meant that the manufacture of the watch could be fully automated.
The company has a very effective marketing strategy. It has different varieties of watches for different segments (according to age of their customers). It makes sure that it has a series of new watches with different styles for every season (Spring collection,
Summer collection, etc.), every special occasion and every significant world event (like the Olympics and the World Cup). Swatches used to be available in every store at affordable prices (to re-capture the lost market share), but now the company has a different strategy to keep peoples’ interest up beyond the 80s craze it has created. It is now doing the opposite of what it did decades ago. This is due to more than one factor including the artistic design (which are sought after). Swatch capitalized on the idea of product line extensions and variations. It has also tapped famous personalities like John
Lloyd Cruz and Anne Curtis (which are effective celebrity endorsers) to represent the company. Product design is