The Swatch Group has developed a large brands portfolio (through acquisitions, joint ventures) on different segments: watches & jewelries; production; electronic systems and corporate. But here, we will focus on the watches& jewelries segment.
As we already read in the previous articles, Swatch Group is leader on global watchmaking market with market share of 17.4 %. Watches & jewelries segment represents 88% of Group’s global sales and continues to increase +9.1% in the first semester 2013. In this segment, the Group has 19 brands categorized into four ranges:
  •   Luxury and Prestige range
  •  High range
  • Middle range
  • Basic range

  •          Luxury and Prestige range


This range repertories brands offering watches over 3000 francs (over 2500€): Breguet, Harry Winston, Blancpain, Glashütte Original, Jaquet Droz, Léon Hatot and Omega. All these brands are historical and prestigious brands with rich heritage in the watchmaking industry. Most of them are pioneered in conception of mechanical masterpieces in the field. They continue to be innovative and to impress by their know-how, the exceptional quality and complications of their watches.

The Luxury and Prestige range is the most profitable in the watches/jewelries segment. Omega achieves 2/3 of total range sales. The high-end luxury market pursues its growth (between 5% and 10% in 2013), sales are still good thanks to increasing demand coming from Asia. But the growth market tends to slow because of global economic slowdown. The Group’s brands are well positioned on this market and take advantage by grabbing more market share.

  •         High Range


Longines, Rado and Union Glashütte are brands belonging to the High range. These are sophisticated watch brands with an excellent reputation in the industry. Indeed they are famous for their design, quality and technological innovation. The High range includes watches with prices from 900 to 3000 francs (from 800 to 2500€).

On the High range watchmaking market, Swatch Group is the global leader. On this market, the main advantage of Swatch Group is that all its competitors are positioned on the global luxury market therefore, for the Group, opportunities to gain market share and make more profit on this range are numerous. The Group’s brands are all in evolution, especially Longines which known growth with 2 figures in 2012.

  •          Middle Range


Tissot, Calvin Klein, Balmain, Certina, Mido and Hamilton own to the Middle range. Again, these are watches with remarkable quality, recognized for their precision but the differentiation point with the “High range” brands is throughout their design, they are oriented more fashion and sport.  The high range includes watches with prices from 250 to 900 francs (from 200 to 800€).

Regarding the market, the Group’s Middle range is exactly in the same situation than the High range. The brands are positioned on niche market having high growth; where there is lot of opportunities to seize. In 2012, these brands known growth higher than their competitors positioned on the luxury market. We can explain the niche market growth by increasing of middle class in emerging markets such as Brazil for example.

  •         Basic Range


There are just two brands in this range: Swatch and Flik Flak. These brands address to young people but with a totally different positioning. Swatch offers original and trendy plastic watches for young people from12 years old whereas Flik Flak is positioned only on children watches market. Swatch is the second most profitable watch brand of the Group (around 16% of total sales). The brands are very affordable with prices lower than 100€.

The children watches market and the entry-level watches market are both mature. Swatch and Flik Flak are leader in their own market.


To sum up lines above, we will use the BCG Matrix very useful to analyze and determine attractiveness and balance of brands or businesses portfolio.
  •        Stars are the High range and the Middle range because they are businesses of Watches & Jewelries segment knowing high market share in a growing market.
  •          Cash Cows are the Luxury, Prestigious range and the Basic range with high market share in a mature market with growth slowdown.
  •          The Watches & Jewelries segment of Swatch Group has no Question Mark which means no businesses with low market share in a growing market and also no Dogs, businesses knowing low market share in a mature market.



As L. said in the article on branding strategies, Ice Watch has at the moment no brands portfolio. But in term of market share, Ice Watch is close to Swatch. Ice Watch market share represents 3.9% when Swatch (the brand) gets 5.2%. But Swatch keep its leading position on the entry level market (from 0 to 50€).


CG.


Source:
·         http://www.swatchgroup.com/en/brands_and_companies/watches_and_jewelry/prestige_and_luxury_range
·         http://www.fhs.ch/en/news/news.php?id=77
·         http://www.blscapital.dk/en/company/the-swatch-group/?tag=global*
·         http://www.swatchgroup.com/en/services/archive/2013/half_year_report_2013
·         http://www.lefigaro.fr/societes/2013/03/07/20005-20130307ARTFIG00450-swatch-group-porte-par-ses-montres-de-luxe.php
·         http://www.lefigaro.fr/culture/2013/01/22/03004-20130122ARTFIG00295-l-horlogerie-de-luxe-a-plein-volume.php
·         http://www.challenges.fr/entreprise/20120322.CHA4505/pourquoi-swatch-a-toujours-un-temps-d-avance.html
·         http://www.letemps.ch/Page/Uuid/8dfa5ee2-a8fe-11e2-920d-2852686e7c27%7C0#.Upe8dcTuIl4