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Why are consumers over the moon with the Swatch X OMEGA collab?

Why are consumers over the moon with the Swatch X OMEGA collab?

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Snaking queues emerged globally as Swatch and OMEGA announced the drop of its BIOCERAMIC MoonSwatch collection over the weekend. The 11 series collection pays homage to planets and were priced at an affordable US$258. The hot new collaboration puts a youthful twist to OMEGA's iconic Speedmaster Moonwatch which sells at a minimum of US$6,600.

The launch of the watches saw consumers queuing in the wee hours of the morning not just in Singapore, but across markets such as Hong Kong, Thailand, Malaysia, Japan and many others. The global frenzy prompted Swatch to release a statement on its website that the watches will be limited to one watch per person until further notice, reemphasising that this isn’t a limited edition collection and the watches will be available in select Swatch Stores for the coming weeks.

The collaboration comes as The Swatch Group, which oversees 17 brands including OMEGA, struggled in the past few years with global sales of the watches and fine jewellery industries heavily impacted due to the COVID-19 restrictions. However, eCommerce has certainly been a buffer for the company which reduced 22% of its retail network due to movement constraints.

Nonetheless, if the weekend’s crowds were any indication for the brand, clearly the collaboration has revived its retail outlets. In fact, in its 2021 financials the group said that it anticipates double-digit sales growth in local currencies in 2022 “ensured by numerous, and in some cases, spectacular new products from the brands in all segments".

Spectacular, indeed. Industry players MARKETING-INTERACTVE spoke to say the move is not just a great way to spike short-term sales for the Swatch Group, but also introduces a new consumer segment to OMEGA.

The idea of two brands collaborating especially in the fashion and luxury industry is not new, and in recent years has accelerated. Most recently, Gucci partnered up with sister brand Balenciaga for "The Hacker Project", a collection that "hacked" designs from iconic pieces from each brand. Other examples include Tiffany and Supreme, Nike Air Jordan and Dior.

In the watch industry we have also recently seen Hublot and Murakami pair up, while John Mayer and Gshock also inked a collaboration. In a conversation with MARKETING-INTERACTVE, managing director of Carousell Hong Kong, Kevin Huang, who is also a watch enthusiast, said, what made the success of the OMEGA x Swatch, also known as MoonSwatch, so great was due to the fact that two iconic brands having a deep history and a major fan base coming together to offer something that was fun, accessible and affordable to the masses.

“Swatch was largely responsible for the revitalising the Swiss watch quartz crisis of the 70s and became a fashion icon in the 80s and 90s while the OMEGA Moonwatch is a historic and iconic watch that well, went to the moon,” said Huang. As such this collaboration hit the sweet spot in reaching a target customer base of both brands that spans across multiple age groups. It also targets a major group of customers who grew up with the Swatch brand, but grew out of them and are now in the luxury segment such as OMEGA. 

“For many in my age group, with the MoonSwatch, I am able to relive the joys of owning a swatch watch during my teen years while satisfying my need for luxury watch. For first time buyers, the MoonSwatch is a first taste of the Moonwatch and hopefully grows them to aspire to own the OMEGA Moonwatch at a later stage,” said Huang.

Getting the right buzz

Another reason the collaboration was such a huge hit was because of the way attention was hacked of two different brand fans, explained VJ Anand, managing partner of VaynerMedia APAC. Anand, who is a self-professed street wear enthusiast, said that collaboration is always a big aspect in pop culture and the sneaker world. However, collaborations in the watch industry – such as Hublot and Murakami and John Mayer with G-Shock – haven’t always created as much buzz as the one now. He said:

The attention of these diverse fans coming together is what created the buzz and the strange thing is, OMEGA and Swatch aren’t the most hype brands around.

“The moonwatch is a pretty iconic watch but collaborating with its sister company Swatch, and creating an entry level price point was probably a smart product and marketing idea – as much as luxury watch fans might hate it,” said Anand.

Anand added that brands today have the power to create buzz and create products that consumers and fans can go crazy about. However, with that power comes the responsibility to launch it the right way and to make sure true collectors and fans get it.

“Give people something fresh, new and something they want to brag about. The launch was popular because no one has ever taken a luxury watch and created and entry level version of the watch. What Swatch and OMEGA did well on this was it's a general release not a limited edition one, so more fans and collectors will get their hands on these cool watches,” said Anand.

He added that Swatch now has to turn this incident into a “gateway drug” and pump out more watches giving everyone a chance to own the watch.

“Some of the people who get this will eventually graduate to an OMEGA moonwatch. It could be smart to target a younger aspiring audience and move them up the chain. Own the future,” he said.

When luxury meets mass 

Erica Kerner, currently CMO of SailGP who has had experience in the luxury working with the likes of Tiffany & Co. Asia Pacific and Ralph Lauren said such collaborations are great for the luxury industry, but it is key to remember the story being told and the value brought to each other through introducing new consumer groups, driving media value or creating brand buzz.

“There are so many collaborations out there at the moment it is critical that they bring something special to cut through,” said Kerner.

“Watch collectors are much like 'sneaker heads' – the style is extremely meaningful.  This collaboration was a way to introduce OMEGA to a whole new consumer who may have aspired to own one but didn't have the resources...yet,” she added.  

Moreover, it is important to remember that brand collaborations should not be simply transactional in nature but also increase brand equity for long term financial gains.

Branding expert Ambrish Chaudhry, managing director of Superunion Singapore, India and Indonesia added that beyond the stunt being a boost for Swatch, it also serves as a reminder of how prestigious OMEGA is. However, it’s a dangerous game to play, he warned.

“Brand equity is like a bank account. You can occasionally make short term withdrawals but can’t see this as a healthy trend for OMEGA,” he added.

Dominique Touchaud, CMO of Shokunin Marketing and director of global advertising for Swatch in 2001 to 2003, added that brand collabs and cross over IPs have become a very common element in the marketing toolbox, and a very sound method to market a brand if done properly.

However, he likened this collaboration to “if Ferrari and Fiat produced a model together”.

“In a nutshell, I don’t understand this collaboration. It will sell, for sure. People are queuing up at the Swatch stores gates in ways that have not been seen in decades and thousands of watches will be sold. But what will Omega gain from it and what will be the impact on both brands in the future,” he questioned.

Touchaud added that the concept of luxury is more elusive than most recognise and is rather a result of a perceived added value. He said:

This collection is a lesser Omega, without being a better Swatch. The models are basically Omega replicas manufactured in ‘Swatch’ Bioceramic and fitted with quartz mechanics.

“There is no hip or cool factor for an Omega admirer to have a cheaper version. It could be quite fun for a non-buyer though to get something that looks like a Moonwatch, but that you can finally afford,” he said. However, Touchaud says it will not entice them to buy a Speedmaster.

“It’s the same as how buying a Rolex on the grey market 30 years ago was not driving you to by a Rolex in a store when/if you could finally afford one. The magic was gone. It took Rolex years of relentless fighting against replicas to stop this ‘accessibility’ scam. The Omega marketers are creating the replica themselves and branding them -the logic evades my reasoning,” he said.

Given the product is not a limited edition one, Touchaud says this will keep it out of the collector’s box. Moreover, the value – while being sold on resale platforms now at exorbitant prices – might not increase with time.

“I remember when we launched a Swatch Square ‘Reverso’. It was clear ‘friendly/respectful jab’ at the Jaeger Lecoultre icon and it made people smile (and buy). A provocation to luxury watches is what Swatch had become known for. And it was redefining what luxury meant. Swatch was always pushing for an individual expression of style and personality,” he said. Meanwhile luxury brands such as Omega need to create extreme desirability through exclusivity and craftsmanship.

“In launching this collaboration, I feel that both brands have forgotten about the aspirations of their consumers without generating enough interest amongst non-committed audiences. What will come next? A Swatch ‘Breguet’ or a Swatch ‘Rado’?”

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