Rolex Standing The Test Of Time Marketing Essay

Arguably one of the most famous brands of all time, Rolex has a long history steeped in innovation and excellence, and a strong association to prestige, mystique and accomplishment in the minds of its customers. Established in 1905 by Hans Wilsdorf and his brother in law, the London based company – originally named Wilsdorf & Davis – specialised in watch distribution. In 1908, Wilsdorf decided to create a new name for the company that was pronounceable in all languages and concise enough to display on the dial of its watches – and the super-brand Rolex was born. The company’s headquarters relocated to Geneva, Switzerland in 1910 and remain a major contributor to the economic system today by employing more than 3300 employees.

Ironically, the company is as hermetic as its renowned Oyster case. Wilsdorf – an heireless widow at his death in 1960 – left Rolex to the family Wilsdorf Trust so Rolex could never be sold and ensuring Rolex was able to stay true to Wilsdorf’s values and long-term vision of excellence and prestige without interference from shareholders. This unique position also means that Rolex does not publish financial or sales data and therefore the figures contained in the remainder of the report are estimations unless otherwise specificed/referenced.

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Annual production of Rolex watches are estimated at 750,000 per year – a key feature of Rolex’s strategy is to ensure that demand is always higher than supply.

The loyalty to the brand is also clearly evidenced by the 5-year waiting list for it’s stainless steel Daytona model.

Competitors

The brands main competitors are OMEGA, TAG Heuer and Breitling who compete in similar market segments for watches which form follows function,

Rolex remains the market leader with its competitive advantage of almost a century of sporting, innovative breakthroughs as described below.

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2.1.1 Key achievements

It can be argued that Rolex’s innovative achievements are second to none and unmatched by any rival competing in the luxury segment:

Among the company’s innovations are:

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Unlike it’s competitors, Rolex is in a strong strategic position – its founder Hans Wilsdorf ensured that the company can never be sold and it today belongs to the Wilsdorf trust. Rolex does not have to deal with the pressure of shareholders who require short term benefits in order to show a profit from their investments through the redistribution of dividends. On the contrary, Rolex has the opportunity to reinvest the benefits in the company to improve distribution and after-sale services and to increase research and development. What is more, they are not pressured to follow the general trends of the industry to please shareholders. To date, Rolex is the only luxury watch brand not following a multi-brand strategy.

Rolex employs about 6000 persons worldwide … of whom 3300 employees are based in

Geneva; setting Rolex as one of the main employers and tax payers of Geneva. They are

selling around 750000 watches each year for an estimated turnover included between 2.5

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and 3 billions CHF. As Annex III: : Top 20 watch brands (sales) shows, Rolex is the first

brand of the luxury watch industry in term of sales (factory price). Moreover, Rolex

possesses 22 subsidiaries companies spread all over the world

2.6 Product Offering

Rolex produces only round watches since more than 40 years. The brand encompasses only

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two collections: the Oyster that represents around 140 models and 80% of the sales and the

Cellini. The design has always been very conservative and the only radical innovation was

brought in 2000 with the launch of a colorful Oyster Daytona.

Current strategic approaches

Celebrity endorsement:

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Conservatism and tradition are the credos of Rolex strategy: same product and same

communication in the last decades. Its unique communication strategy and differentiation

enabled the company to gain a sustainable competitive advantage over the years. The brand

embodied achievement and keep nurturing this myth thanks to successful celebrity

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endorsement. Rolex also maintains a part of mystery around its brand in order to cultivate

the legend. Rolex has been considered a long time as a male watch; they are trying to get

the woman to like it to. Another important theme of the strategy is the backward vertical

integration in order to secure future supply and definitely loose dependence on competitor

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groups. Finally, emerging market represent also a priority due to its foreseen potential. The

next sections are discussing these points.

2.9 Target Market

Market segmentation

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2.11 SWOT Analysis

3.0 A Broader Context – market analysis

3.1 Market Overview

3.2 Direct Competition

3.3 Indirect Competition

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3.4 Market Analysis

3.5 Changing Market and Future Trends

3.6 Marketing Mix

3.7 Opportunity Exploration

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4.0 Future Strategy – Proposal

4.1 Overall Aim

4.2 Objectives – Channel Strategy to achieve aim.

4.3 Market Analysis – Distributor Overview

4.4 Potential Stakeholders

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4.5 Marketing Mix

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