The Overall
Market
The overall market of watches in Australia is comprised of five different
buyer groups that are all interested in the different types of watches found in
the market. The First type of buyer is the young impulsive consumers,
who are the first to purchase a new line of watch that is deemed to be the next
hot product on the market. The Second
type of buyer are the ones who follow trends and just buy what every else is
because it’s the latest thing on the market. Thirdly there’s the older group
who simply have good taste and a sense of style and after that there’s the
university students and college students who can afford wealthier brands of
watches on the market,and finally there are the fashionable senior citizens who
wear the next best thing on the market. (Bplans, 2012).
In Recent times Australia has seen a growth in the luxury watch marketincreasing
to ‘25% from 2010 to 2012’. This staggering amount is due to the increase in
wealth and the need for a high social status among people. However,this
increase is still behind the rest of world although the need for watches will
always be there as they are finding new and better ways to make and innovate
watches today. (Stephen
Lacey, 2013).
Segmenting the Watch Market
The
segmentation of Watches in general is broken down into twomain parts. Demographic and Behavioural aspects that companies like Swatch and
Rolex use to target and go to market with. When looking at thedemographicsegment
for watches we focus on age and gender as they are the two main key areas. Age
is an important variable when trying to match the style and look of the watch
with the buyer and the age of a buyer can sometimes determine what their buying
habits are like. For example a younger person would be more so attracted to a
coloured watch and might have impulsive habits where-as an older person might
like an more conservative look and might not want to buy it upon first look. The
style and price of the watch is a key aspect nowadays, as a larger number of
younger people are purchasing watch brands.
Gender is also a major aspect for manufacturers as they have to very
different demographics to market towards. Male and female traditional watches
are very different in style but nowadays watches can sometimes only be
determined male or female by the colour. This is easy for manufacturers as they
don’t have to change a lot on the design for both demographics.
In the
market today many organisations are changing the way they see the market, from
a timeless keepsake to a more fashionable accessory. The watch industry has
changed overtime due to the needs and wants of the buyers. Manufacturers are
segmenting the market more diversely these days due to a larger population of
possible targets. These targets or differences in people such as age, gender,
behaviour or even psychographic needs are the reasons for a wider more
diversified market. Nowadays we don’t just see the plain old business man
wearing a stylish watch, but we also see the young hip culture wearing their
own brands of watches too.
Manufacturers
like Rolex and Swatch are finding it hard to compete with china’s watch market.
China produces on average 663,000,000 million watches annually as compared to
Swiss watches 29,200,000 million however, the Swiss watch makers still hold the
largest percentage of market share as their watches are sold for $739 as
compared to China’s watch price of $3 (Federation of the Swiss Watch Industry
2013).
‘Nowadays, Swatch is familiar with the fact that specialization in a
chosen market is more profitable than trying to reach all consumers in the
market. Therefore, the choice of its target market was made very carefully’
(Marketing Report Revised, 2010).The target customer of Swatch is from 18 to
30, even extends to middle-aged who advocated young mentality. (Smiled, C
et al, 2014). However, Swatch predominantly targets towards younger segments,
primarily because of its youngish style (Dvog, 2012). Swatch focuses on both men and women. The
colourful watches and different designs are sufficient to satiate the needs of
customers. For example, men can choose the black watch and women can choose the
pink one. There are also neutral styles for both men and women. (Smiled, C et al, 2014). I think Swatch
should stay where they are in the segmentation strategy as they have clearly
found a target market that suits their product, their segmentation strategy
which comprised of opening up to a new market that watches has no previously
marketed towards allowed them to find a gap in the market. This new gap created
a stream of attention when Swatch made this decision in the mid-80s. ‘Their
main goal was to produce an artistic, low-cost and high-tech watch. This turned
out to be a very successful concept and they became the world’s largest watch
producer. This position made it possible to extend their range of products and
to use a differentiated strategy’ (Marketing Report Revised, 2010).Theirmain audience
are enthusiastic and positive toward new product releases and will come back
and buy the latest and best on the market(Dvog, 2012).People buy a
Swatch because it is economical and in good quality, furthermore they buy it
for fashionable decoration. Swatch breaks through the single functions of
watch, using the combination of style and gorgeous colours to catch consumer’s
eyes. (Smiled, C et al, 2014).
References:
Bplans, 2012, “Export Watch
Manufacturer Business Plan”, Grutzen Watches, viewed 12 May 2014. http://www.bplans.com/export_watch_manufacturer_business_plan/market_analysis_summary_fc.php
Dvog 2012, “Swatch/Business and
Industry”, Papercamp, viewed 12 May 2014
Federation of the Swiss Watch Industry 2013, “Wrist Watch Industry Statistics”, StatisticsBrain, viewed 12 May
2014
Marketing Report Revised 2010, English 2/Blogger, viewed 12 May 2014
Smiled, C Lu, Z Cloud, G 2014, “The
Segmentation Analysis of Rolex and Swatch”, Baidu, viewed 12 May 2014
Stephen Lacey 2013, “Luxury watch
sales are booming in Australia as $650,000 timepiece finds a home/Time Is Money”,
Traveller, viewed 12 May 2014 http://www.smh.com.au/travel/experiences/luxury/time-is-money-20130419-2i4c8.html
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