Don’t Believe the Hype:
How Swatch ‘dropped’ and re-wrote the rules of Hype Marketing
On July 20, 1969, man dropped it’s anchor on the moon for the very first time.
Little did Armstrong know that over a half century later, the moon would ‘drop’ on Earth.
Literally.
March 26, 2022: The MoonSwatch drops in select Swatch stores.
Here’s the kicker – “Select” swatch stores.
The Swatch and Omega collaboration has probably been the most anticipated watch launch as far as I can remember. And I don’t even follow this category. But I do like the brand and own a few Swatch watches, the most expensive of which is under $90 and bought a decade ago.
But this was different. Two brands of the same family coming together to forge a new style – the casual quirkiness of one with the iconic style of another.
The Business Problem
Most millennials don’t wear watches as there are enough activity trackers and well, there’s your mobile. So why the need for a wristwatch? How do you attract this consumer to a category that is slowly losing its relevance?
The luxury watch market was seeing unprecedented growth during the pandemic (yes, fact!) and the premium for select models was as high as 200%. Today, try getting a Rolex at retail price. Good luck.
Swatch saw this an opportunity and began working on this collab in 2021 and by 2022, they had the product ready to launch.
Create a cool collab, build the anticipation, manage the supply and BOOM! You’ve got yourself a winning formula.
Make a $7,000 product available at $260… what’s there not to love?
The Strategy
Swatch was smart. It adopted the Supreme and OffWhite playbook and created demand for a plastic watch by crafting a story which otherwise wouldn’t have garnered a second look. By collaborating with its sister brand, Omega, Swatch has managed to create a new consumer category with a $260 collab of Omega’s Speedmaster Professional design.
Win-Win.
The brand created anticipation and frenzy by restricting availability (supply) causing mayhem at pre-selected stores on the day of the launch. Something that one only witnessed outside Apple and Supreme stores. This led to further interest and desire creating a parallel market for the watches on secondary sales sites. Sound familiar?
Swatch has a history of collaborating with cultural icons like Keith Haring and Kiki Picasso but this was something unprecedented. Therefore, this new collab made perfect sense – it rejuvenated the brand (Swatch) that had lost its mojo with its core TG while on the other, it created a new market for a luxury brand (Omega) that was otherwise unaffordable to most.
More importantly, the product d not dilute the original, but rather borrows from it and gives it a new lease of life. The form, asymmetrical case, size — 42mm in diameter and 13.25mm thick – area all an homage to the original Speedmaster. Furthermore, the dials carry Omega’s branding and the Speedmaster logo (along with the Swatch name and the new Moonswatch mark).
Attention to detail is core to the product DNA.
Business Impact
The best collabs create long term brand and economic value for all involved by reaching new audiences and even getting existing customers to fall in love again with the brand. In July 2022 Y-o-Y sales were up over 7% and are predicted to reach $50m conservatively with some anticipating a high of $130m this FY.
This from a loss of 150 million Swiss francs on sales of around 210 million Swiss francs in 2021.*
Not bad for a plastic watch.
The knock-on effect was also felt on the Omega Speedmaster, which saw a two-fold increase in sales in the same period.
The frenzy will probably decline with production and availability are increased but that’s OK. Because by then Swatch would have achieved a lot more than it had bargained for – an increase in brand equity, enhanced cool quotient, and a significant improvement on its bottom-line.
When the Stars (and Moon 😉) align Beautifully
I am far from a millennial but I so wanted to get my hands on one. But what was it about this product that made it so coveted? Was it the design? The price? The so-called exclusivity? Or was it just the hype? And was I willing to wake up at the crack of dawn to stand in line in the hope (yes hope because the store doesn’t tell you when the stock will come and which models will be on sale!) that the watch will be available on that particular day.
Nope. Not a chance.
I had given up on getting my wrists on this watch and was happy with my Swatch Irony, resigned to the fact that it is what it is.
But…
While aimlessly walking the streets of in a small town in Europe while on holiday, trying to find a decent café, I happened to see a Fiat 500, dressed up in Blue, with a decal of the planetary system.
You can fill in the rest.
What a simple strategy.
If the consumer can’t get their hands on the product, take the product to them.
And if you drive it, they will buy it. (MUST WATCH Launch video: https://youtu.be/ul2kRJaLxnw)
11 cars, all customised to reflect the respective MoonSwatch models, driving around Europe, with the only aim of creating a moment. A moment with the customer that will become an experience, delight the customer, and will be amplified at no cost to the brand.
I plead ‘guilty’. Why not? Appreciate the good stuff. Study it. Learn from it. Maybe even adopt some elements in your business.
My PoV
Even the biggest cynic will appreciate the time, effort, ad resources that Swatch has invested in this exercise. This is not a limited-edition watch.
It’s not even a limited series watch.
It’s just limited supply.
And that’s the beauty of this entire strategy. A combination of belief, purpose, and organisational synergy.
Dr. Dre and his boys may have to regroup and re-write the lyrics to their classic…
“The minute they see me, fear they want me
I’m the epitome, a public enemy frenzy
Used, abused Desired, wanted, without clues
Will suffer in long queues I refused to blow a fuse
They even had it on the news
Don’t Better believe the hype”
(And rapped by a MoonSwatch, let’s say Jupiter 😉 with due deference to Public Enemy)
Vishal Jhunjhunwala
Partner – Square Consulting