* 1 – Why is the watch industry a global industry?
* 2 – How do the drivers of competition in this industry differ from multi-domestic industries? * 3 – What is the company main global marketing strategy? * 4 – What differentiate the company from its competitors? * 5 - Which marketing actions should the company take to enter more aggressively in the Global Market? * 6 – What are the pros and cons to used marketing strategy admitted in the case study? * -------------------------------------------------
7 – What future threats(amenaza) do you see for Swatch and what corrective actions do you suggest? THE "CASE" SWATCH
1. INTRODUCTIONAmong the numerous grades of wrist-watch we thought necessary choosing the Swatch model, this being a very significant design object. It becomes popular not for the shape innovation but for the message it carries inside and for the high quality with a low cost.2. WHAT IS SWATCHThe Swatch comes out like a moulded plastic watch with a quartz movement and it is entirely produced in Switzerland. In 1986 the Swatch was launched in Italy, the last great European nation to have received it into its market; because of this reason at the moment of its launch the Swatch success was tremendous. The Swatch is manufactured in an enormous amount of models, at about 140 each year, the most part of which is designed in the Swatch planning laboratory in Milan; at about 20 people coming from different parts of the world are working here. One of the greatest contribution as a art director of the laboratory was given by Alessandro Mendini a famous italian designer. At the moment, the range of Swatch watches is made up of the classic first model and of products carrying out different functions such as the scuba (subaqueous watches), the chrono (quartz chronographs), of automatic models and, newly, of metal watchcase watches.3. THE WATCH MARKETThe Swatch comes out in Switzerland to contrast the crisis of the national watch industry blew up in the 70s because of the arrival of hundreds of quartz watches at a low price, coming from Japan and from Hong Kong, and for the decision to adopt not the quartz technology the Swedishes themselves had invented. There were, moreover, strategic, structural, and managerial problems too. The two biggest Swedish watch firms, the Ssih (Omega) and the Asuag (Rado, Longines, Ebauches) were going to a bad patch because of erroneous production and selling choices and, in 1983, this will bring them to merge into Smh (Swiss Corporation for Microelectronics and Watchmaking). At the moment of the merger of the two companies, the watch market had a selling volume of about 500 millions of annual units, divided into three different segments. The lowest market segment included watches at a cost of about 75 $ at most and represented 450 of the 500 millions of units. The intermediate segment, with prices of about 400 $ at most, affected the market with 42 millions of units. The last segment, the highest, was made up of 8 millions of pieces with prices varying from 400 to several millions of dollars. The Swedish quota at the lowest segment, 450 millions of watches, was equal to zero; in the intermediate segment it was of about 3%, while in the highest was of 97%. The Swedish producers reacted to the quartz technology bywithdrawing gradually themselves from the lowest segment, by exposing themselves, through time, to attaks of the oriental producers also in the other segments. It was at this moment that the Swatch operation came out, to have a wide presence in the market, so to control the quality and the costs also in the other segments.4. COMMODITY OR UTILITY?To consider the watch not to be necessarily a commodity but a emotional product able to show a image to the others was the factor of success of the creation of the Swatch. This object became popular in a absolutely new market thanks to the discovery of a new language of visual communication that was visible in...
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