Swatch - SWATCH INTERNET TIME
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The Swatch Group, led by Nicholas Hayek, transformed the Swiss watch industry by innovating with the Swatch Internet Time (SIT) concept in 1998, which aimed to provide a universal time reference for the internet. Despite a challenging market, characterized by low-cost competition and technological advancements, Swatch managed to maintain a significant market presence by focusing on creativity and high-quality, affordable products. The brand’s initiatives, including limited edition watches and collaborations, sought to foster a strong emotional connection with consumers while expanding its reach through new media and distribution channels.
Swatch - SWATCH INTERNET TIME
- 2. 2 SWATCH • The Swatch Group, one of the leading watchmakers around the globe has grown rapidly in the past few decades, and the credit goes to the influential leadership of Nicholas Hayek. • The emergence of Swatch changed the landscape of the industry and allowed the Swiss industry to cater every segment. • In search of revitalizing the industry, Hayek searched for new potential opportunities in order to become competitive and attach a diversified image with a diversified portfolio.
- 3. SIT 3 • Swatch Internet Time (SIT) is also part of exploring new opportunities which the company launched in the late 1998. • 1000 Beats – 86.4 seconds • @000 and @500 • New Meridian Line- Biel Mean Time • “Internet time absolute time for everybody,” • The idea is unique and is aimed at creating a new reference time for internet and providing people a common time around the world which has been promoted through different mediums in different locations.
- 4. CONTROLLED CHAOS 4 1998-Worlds Largest Watch Company 20-25% of world wide watch sales $2.2 billion in 1998 and profits of $230 million Market share of 15% 30th most well known brand and 6th in fashion Not just a style “We are offering them a message that tells people who you are and why you do what you do” High Quality, Low cost, joy of Life, and Challenging society.
- 5. CULTURE • Hayek was Impatient, convincing confrontational and dedicated • Born in 1928 in Beirut Lebanese mother and an American father • Even handed skills as an entrepreneur and manager • Hayek believed in creativity and innovation 5
- 6. THE BIRTH OF SWATCH 6 The swatch group was established in the midst of crisis in the swiss watch industry. Cheap labour ,mass production and quartz technology penetrated the world No presence in low end , 3% in mid market and 97 % in premium which accounted for 1.5 %of world sales Swiss exports reduced to half. It was a result of inability to change, poor R&D
- 7. HAYEK’S DIAGNOSIS 7 Worldwide market and consumer psychology study Merge SSIH and ASUAG, Hayek would buy majority stake Develop low cost high quality plastic watch brand Consumers are willing to pay premium on swiss watches Improving on productivity, low priced watches Worlds thinnest analog watch was made Reducing parts from 151 to 51 ETA presented waterproof shock resistant and accurate time piece Tested US as new market for the first time
- 8. INTRODUCING THE SWATCH 8 March 1,1983 - Switzerland “High quality low cost, joy of life and challenging society” Models for various occasions and personalities, limited edition watches Going beyond TV advertisements except in US Brand with genuine emotion, attacking low end with strong message.
- 9. New releases, special editions, special events Online store – Swatch Beat (3 at a time) Fashion item rather than a technically advanced product. Structured in product-country matrix Sales went down, youthful and colorful watch 9 Swatch Collector’s Club Regular stores Americans preferences Expansion of distribution channels A fad? MANAGING THE BRAND
- 10. BEYOND WATCHES Product line expansion: Telecommunication and Cars JV with Siemens 01 02 10 Siemens provided telecom technology where as Swatch showed expertise in manufacturing ‘things that are tiny’ Siemens share taken over by Swatch JV with Mercedes-Benz Late and over-budget production 03 05 03 04
- 11. SWATCH INTERNET TIME SIT was promoted through a variety of media including: 11 International alliances Print Ads Internet PR Events
- 12. On October 23, 1998 the “Three Nicks” (Hayek Sr., Hayek Jr., and Negroponte) officially launched SIT to the international press. One month later, Swatch began offering free Internet time clock software for PCs on its website (www.swatch.com) The company also reached agreements to display SIT on the CNN news channel, Sony’s computer games, Apple’s iMac. The company used the traffic it drew to its website to promote SIT to the greater public. Since the launch of SIT and new line of Beat watches, hits to Swatch homepage had increased from 13 mil per month to over 50 mil. 12
- 13. WHAT IS SWATCH? Different stores, various materials, colors and finishes don’t give a coherent message. No one was getting what Swatch is all about. Great Ideas…But meh! 13 “One of the problems is that Swatch doesn’t have an overall brand look” explained one U.K. based watch designer.
- 14. 14 Hayek Jr. came up with an answer, He mentioned that Swatch’s core business will always remain “time” in all its forms. “Time is in our blood. I hope it catches on. Whatever we do that lasts more than two weeks will be a success. We do not know where Swatch will go tomorrow.”
- 15. THANK YOU