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Economy

Culture . Economy. Product. P rice . Consumer Needs . Law . P romotion . P lace . Competition . Technology . What was the answer? . A low-cost, high-quality plastic watch low cost means high volume high volume permits economical automation

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Economy

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  1. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  2. What was the answer? • A low-cost, high-quality plastic watch • low cost means high volume • high volume permits economical automation • automation reduces labor costs (<10% of total costs) • with low labor costs Swiss can produce the entire product themselves (vertical integration) • do not have to outsource for parts, they can maintain strategic independence

  3. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  4. Product Positioning Omega Cost Quality

  5. j brands Importance Weight n Attributes Swatch Timex (a) (b) (c) 10 10 Tells Time i Inexpensive 6 9 i = n SWi =1 i = 1 i = n S WiXij i = 1 Attitude (j) =

  6. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  7. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  8. The SMH ("Swatch group") product line

  9. The Swatch group product line

  10. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  11. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  12. Brand identity and brand image • What was the brand image Swatch intends to portray? • What image do you have of Swatch watches? • Brand extensions?

  13. Psychographic segmentation of U.S. consumers • 6-10 Consider it "cool", because big kids have it (42% awareness!) • 11 –15 ("teeny boppers") provides sense of identity • 11 –15 ("young rockers") high awareness, but represents t.b. lifestyle • 11- 15 ("students") Swatch too wild for them, but they might buy it to fit in • 16 –22 ("rockers") like the price, but dislike the male model geeks • 16 –22 ("preppies") prefer a dressier watch • 16- 22 ("trendies") hate it; "fast food of time pieces" (73% wear no watch) • 22 –32 ("transitionaries") like its durability, disposability, price • 22 –43 ("older casuals") watches are used to tell time (4% awareness!) • 33- 43 ("weekend hippies") teen image (high awareness, but 43% have never seen a Swatch in real life

  14. Culture Economy Product Price Consumer Needs Law Promotion Place Competition Technology

  15. What was Swatch's innovationfor stimulating demand for watches?

  16. Market Segments • Swatch was part of a multi-segment strategy > $400 8 Omega Longines 42 > $75 450 Swatch Millions Sold Per year price

  17. j brands Importance Ultra Weight n Attributes Brite Gleem Crest (0.6) (0.3) (0.1) 2 7 7 Decay Prevention i 6 4 4 Taste 7 5 2 Whitening Power i = n SWi =1 i = 1 i = n S WiXij i = 1 Attitude (j) =

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