There are two primary reason for the success of Swatch: one is the effective marketing strategy which the company uses by satisfying its target market well; the other is high quality and various design. Due to its high quality, Swatch watch is no longer just a simple everyday watch but one of the hot collectible items in the world. Additionally, they also have series of atches for every season, every special occasion and every event in the world (Thinking made easy,2008).
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However, more recently the whole watches market has been driven by a number of forces, which provide both opportunities and challenges with most of watchmakers. Swatch is no exception. Intensive competition between different brands is increasing in order to survive in this changeable market. The needs and wants of individual customers vary greatly and continually, which also means the customer is still seeing something new that will urge them to continue to support the products (Thinking made easy,2008).
Therefore, Swatch must continue their performance and work and continue to research about its marketing environment, adjusting its marketing strategy timely to target customers. The aim of this report is to recommend a new marketing strategy to Swatch company, which can help this company win the competition, increase the sales profit and maintain brand loyalty. According to PEST analysis, Five forces analysis and SWOT analysis, the environment where Swatch company exists could be seen clearly. Lately e-commerce is used widely and becoming more popular.
Due to the credit crunch, customers switch their purchase from Luxury items to low-price items. However, persistent economic recession in the UK has an adverse impact on Swatch. Intensive competition with other companies still put heavy pressure on it. Fortunately, Swatch has already been a strong brand image in the customers’ mind and has a wider presence in the fashion market. The high-quality and unique products are also becoming its strengths. Women are the major buyer in the UK market and they purchase more for themselves than men.
In terms of segmentation, targeting and positioning, the target market of Swatch is working women among the 24 to 35 age group, who are able and willing to spend more on themselves. With the tendency of high porportion of single women, and high late marriage rate, this age group will extend to benefit the company a lot. Swatch also position itself in a high-quality but low-price place to attract more customers. Combining with all of above analyses, this report recommend Swatch to adopt market- penetration strategy, which requires the company to sell current produt to its current market.
Customerized product sold with high price right aims at its target customers and satisfies their tastes. Under the help of moderate implementation and control, it is evident that market – penetration strategy fit for Swatch and would bring maximized profit to it. 2. 0 Introduction According to Kidd (2007, p. 1-21), the watches market has shown a consistent growth profile, with year-on-year sales rises from 2002, to reach a value of ? 1. 22 bn by 2006. However, more recently the watches market has been driven by a number of factors, whether positively or negatively. Limited growth and any downturn in the UK economy would lead to declining sales • Higher spending in other areas, such as clothing, food and travel • Many brands compete with each other to gain more customers, which increases the product-competitiveness and price-competitiveness • Expansion in the retail distribution • Reposition into the fashion market • Women are the major buyers in UK market and majority of their purchases are for themselves The Swatch Group Ltd is based in Switzerland and the world’s largest watchmaker (Kidd,2007, p. 27).
It owns 19 watch brands, such as Omega, Rado, Longines and launches its products over 50 locations, including France, Germany, Italy, USA, the Virgin Islands, Thailand, Malaysia, and China, with its main facility in Switzerland. Swatch is one of the brand owned by this company, who is very famous for its slim plastic watches. As it is stated that (oppapers,2006), Swatch has uniquely pioneered the low cost fashionable watch market by combining fashion, style, and Swiss technology, and it sells watches, various accessories and apparel primarily to teens and young adults n the world. To compete in such a changeable watches market and satisfy its target customers well, Swatch must perform hard. How it can differentiate its products by carrying out a perfect marketing plan to attract its customers and maintain its brand loyalty will be the key and demonstrated in this report as its final objective. The report will first analyze the external and internal marketing environment for Swatch where it competes by using a range of theoretical frameworks, such as PEST, Porter’s Five Forces, and SWOT.