THE SWATCH GROUP CONTROLLED CHAOS CULTURE of Swatch THE BIRTH OF SWATCH HAYEK’S DIAGNOSIS MANAGING THE BRAND BEYOND WATCHES SWATCH INTERNET TIME

1. THE
SWATCH
GROUP
ON INTERNET TIME
Group10

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