Temple University, Philadelphia PA 19122, USA
Branding Time: Swatch and Global Brand Management 1
RAM MUDAMBI, 2005 email@example.com Societe Suisse de Microelectronique et d’Horlogerie (SMH) was formed in 1983 by merging the two leading Swiss watch groups, SSIH and ASUAG. SMH and its main brand, Swatch, was the outcome of crisis forthe Swiss watch industry. In a few short decades, foreign competitors with superior technology had all but eliminated the Swiss from a global industry that they dominated for centuries. The creation of Swatch is the extraordinary story of how the Swiss re-invented their watch industry. Recognizing the crucial role of brand intangibles to its future success, SMH changed its name to the Swatch Groupin 1998. Now in the new millennium the Group needs to chart a strategy to preserve and enhance its stable of global brands. A brief history of time From the earliest periods man has used some form of time measurement, be it only the seasons of the year or phases of the moon. As people began to congregate in villages, and forms of religious ceremonies began, more refined methods of time measurementwere needed. Civilization in early times was concentrated in areas where there was lots of sunshine and water aplenty for the then relatively small populations. Here time keeping was developed along two main lines - from the shadow stick, probably the earlier, and then the water clock. Sundials (first used in ancient Egypt, 1500-1300 BC) and water clocks (developed by the Greeks, 400BC) wereeventually developed to give surprising accuracy. Various other methods were also used. Alfred the Great of England was reputed to use burning candles to measure time (980 AD) while burning incense was in use in China about the same time. By the 1400s mechanical clocks were built in Europe using a mainspring and balance wheel. In 1510 Peter Heinlein, a Nuremberg locksmith, introduced portability byinventing the pocket watch. However, the accuracy of these clocks and watches was poor and they usually required re-setting on a daily basis. In 1583, Galileo Galilei realizes that the frequency of a pendulum's swing depends on its length and n 1657 Christiaan Huygens used this theoretical advance to invent the first pendulum clock, capable of far greater accuracy than any preceding timekeeper. Butthe clock did not work at sea, and this was a crucial flaw.
This case has been written to provide material for classroom discussion. Only published sources were used. Hence any opinions or interpretations presented in this case are not necessarily those of the Swatch Group or any of its employees. Eston Griffin III, Frederick Null, Donald Rieck, Mathew von Wronski and Elizabeth Zadzielski preparedthe original presentation upon which this case is based.
RAM MUDAMBI, TEMPLE UNIVERSITY, 2005
With the European Age of Exploration in full swing, ships were venturing into distant oceans but under severe handicaps due to an inability to determine their longitudinal position. To obtain longitude – the east-west location – from the position of the sun or stars, you must know theprecise local time, which was impossible with the day's poor clocks. It was only in 1759 that John Harrison finally built a clock that only lost 5 seconds on a voyage from England to Jamaica.2 The rise of Swiss watch making Protestant Huguenots, were driven from many parts of Europe and found refuge in Geneva, bringing with them numerous skills and handicrafts. Geneva had been a center for the jewelryindustry for centuries, but John Calvin and his followers frowned upon it as a manifestation of luxury and excess. Calvin took power in Geneva in 1541 and promulgated his Ordonnances Ecclesiastiques, one of whose provisions banned the wearing of the jewelry. Huguenot jewelers rapidly turned their craft skills, knowledge of metals and artistic flair to a useful industry – watch making. The...