The Birth of the Swatch
1. What changes in the production and marketing of watches led to Swatch?
Before 1950s - “home-made” effect
Starting from 1950s watches were considered as very precious goods that only few people could afford. The production of watches was a craft that required accurate skills and mastery of jewels making techniques. Watches were considered as a luxury good as well as a “financial investment”. People spent a lot on them, had great care of them and used to hand them down from generation to generation.
In this period the watch industry was dominated by Swiss producer, watch craftsmanship was developed especially in Switzerland; the country had a great “home-made” effect on consumers: people looked at Swiss watches as the best on the market and trusted the quality and value of such products. Although after the World War II many Swiss watch firms were forced to close because of the recession, almost the 80% of the world’s total production was Swiss: Switzerland was watch’s home country.
From 1950s to 1970s - low-price and new technology
After 1950s the overall industry landscape changed, after-war time companies evolved into the development of low-cost watches. Such watches still used mechanical movements but were made by metals in place of jewels, so they were less expensive but still very precise. In this period Timex was introduced; it is a U.S. company that produces simply designed watches with cheap exterior, but durable and precise. Later, other Japanese companies entered this arena, selling low-price watches with good quality and they started to compete directly with Swiss manufacturers.
Swiss watch producers started to fear competition coming from low-cost producers, and they felt this competition becoming stronger when Quartz technology was introduced. This new technologies created space in the market for Japanese and Hong Kong firms; such firms provided modern, precise and multifunctional watches that appeal customers of all over the world.
Before 1950s - “home-made” effect
Starting from 1950s watches were considered as very precious goods that only few people could afford. The production of watches was a craft that required accurate skills and mastery of jewels making techniques. Watches were considered as a luxury good as well as a “financial investment”. People spent a lot on them, had great care of them and used to hand them down from generation to generation.
In this period the watch industry was dominated by Swiss producer, watch craftsmanship was developed especially in Switzerland; the country had a great “home-made” effect on consumers: people looked at Swiss watches as the best on the market and trusted the quality and value of such products. Although after the World War II many Swiss watch firms were forced to close because of the recession, almost the 80% of the world’s total production was Swiss: Switzerland was watch’s home country.
From 1950s to 1970s - low-price and new technology
After 1950s the overall industry landscape changed, after-war time companies evolved into the development of low-cost watches. Such watches still used mechanical movements but were made by metals in place of jewels, so they were less expensive but still very precise. In this period Timex was introduced; it is a U.S. company that produces simply designed watches with cheap exterior, but durable and precise. Later, other Japanese companies entered this arena, selling low-price watches with good quality and they started to compete directly with Swiss manufacturers.
Swiss watch producers started to fear competition coming from low-cost producers, and they felt this competition becoming stronger when Quartz technology was introduced. This new technologies created space in the market for Japanese and Hong Kong firms; such firms provided modern, precise and multifunctional watches that appeal customers of all over the world.