Swatch Marketing Essay

317 Words2 Pages
In 1986 Swatch management is concerned about maintaining sales growth and agreeing on a long-term international strategy for the company. Swatch recently launched a line extension and the management is considering bringing it to Europe. A SWOT analysis reveals that Swatch’s main strengths are its innovative design, quick collection turnover time and customer loyalty. At the same time there is a big threat from new competition entering the market, copying their designs, and offering lower prices and better features. Physiographic segmentation identifies the opportunity to improve the product image (exhibit 18) while remaining extrovert-oriented and a demand for a higher quality product. Our recommendation is to discontinue the line extension and focus on their core business: innovative watches. We recommend a two fold strategy to maintain market share leadership and reach new consumers: 1) Create a new more “classic” line of watches and 2) Focus on innovation and promotion for the current basic line. In response to the threats and opportunities identified, we recommend launching a new “classic” line targeting the Preppies (exhibit 16). Swatch should bring innovation to the shape/construction of the watch. The new classic line should be offered at a premium price. This line should take the empty space left by the discontinued lines and different ads should be created for this segment. For the existing line, we recommend a disproportionate focus on product and promotion. This can be achieved by increasing resources to better understand consumer needs and design accordingly. While a bigger percentage of the communication budget should be allocated to the local markets in order to better meet the local consumer needs. (As the Regional Manager from France suggested). By focusing their resources on the core business and extending their product range, they will be

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