Ch. 7 - Business Marketing

Rolex is a very well rounded company. It has its own factory, science lab, and in-house foundry to make its own gold.  As a result, Rolex is able to say they make virtually everything in-house.

Regardless of that fact, Rolex still needs its suppliers. Rolex has preposterously high standards for the materials it buys from its suppliers. This includes raw materials like metals as well as precious stones such as diamonds, rubies, and emeralds. Pretty much all other component parts are made in-house. 

 Rolex has a massive gemological department whose goal it is to buy, test, arrange, and set diamonds and other precious stones in a range of Rolex models. The nature of buying these materials are formal and professional, unlike consumers.

In conclusion, Rolex could be categorized as a OEM company. Rolex is a company that buy materials such as steel (904L) to incorporate them into the products they produce for eventual sale.

Ch. 11- Developing and Managing Products

Rolex has been around for over 100 years. As we discussed before, Rolex introduced many new technologies and products in the early 20's. Over the years, the company kept pretty much the same portfolio of watches while constantly updating the past models - Quality modification.

PLC  - Product Life cycles:

Introductory Stage:

Rolex slowly introduced watches to the public rather than a full line at once. Because the brand was released in the beginning of the 20's everything was a bit slower than today. Only after 40 years of its creation, Rolex reached the the brand's 100,000th officially certified chronometer watch. Although by that time the word on Rolex quality had spread already.

Growth Stage: 

After being a successful during its introductory years, Rolex establish a name for itself as a reliable and precise brand. Always innovating, the brand became a pioneer in various aspects in the industry. Around the 50's, Rolex increased its product line introducing watches such as the Submariner, Milagauss and GMT.  As a result, sales increased significantly and the brand gained global recognition. Competition also increased, with brands such as AP, Omega and Patek growing fast as well.

Besides that, Rolex invested heavily in advertising.

Maturity Stage:

Rolex still is at the top of the chain in the watch industry. Although, the company has lost some ground in markets such as Asia, where the product is viewed as an "old people" watch, and the younger and richer generation prefer brands such as Omega.
 I don't believe Rolex reached maturity stage yet and will not at anytime soon. Rolex is the biggest watch company and most well know for over 100 years. Its too prestigious and its items still are desired by many.

Decline Stage:

Some models lost appeal to the current market. Watches smaller than 38 mm are not as appealing as before. As a strategy Rolex made smaller models bigger. One example is the Oyster Perpetual, that is now available at 39 mm. 

Ch. 8 - Segmenting and Targeting Markets

The market for Rolex is pretty specific: people with purchasing power that are willingness to invest a good amount of money in a watch. Not only a watch but a luxury accessory.

Rolex costumers are part of a market segment which is usually filled with collectors, artists and athletes. They all share one characteristic that includes them this segment: purchasing power.

Marketers for the company segment the market by demography, especially by income.
Income levels influences consumers needs and determine their buying power. These characteristics are relevant in the fine watch industry.

As an example in New York you can find a Rolex store or retailer all over the upper east side, where the income rate is the highest in the city. A clear example of Geo demographic segmentation. Characterized by potential costumers and lifestyle.

Olivia Palermo + Rolex Daytona

In the watch industry you have to have well-defined market segments. Sports watches and dress watches.

Rolex offers both and truly understands the needs of both segments. By giving options to its costumers Rolex increases market share and profits.

Positioning:

Rolex made us believe through its products that they are the best in the game. Potential costumers will always consider Rolex when buying an expensive watch. By being a pioneer in many segments of the industry, Rolex made us perceive the brand as the parameter of quality. 

The brand occupies number one spot in the watch industry over the years and it is most likely to stay this way.

Ch. 15- Marketing Communications

Over the years, Rolex has convinced us that what they make is the best in the industry. By introducing new technologies in the watch world and always using the best material available, Rolex has made a name for itself.

To reach its target market, Rolex uses mass communication. By using magazines, social media and lending its name to sports event, Rolex is able to hit a large but still selective audience.

When you receive a message from Rolex you decode the message by concluding that the product is target to a specific group. The use of a crown, celebrities and highlighting the expensive material used in the watch makes the consumer understand that the item is a one of a kind timepiece.

Promotion Goals:

Rolex recently released a new caliber, the 3255. Its a new generation of movements that promises to achieve new standards of performance, such as power reserve, precision, resistance and durability.
By informing all these new features, Rolex expects to draw in more clientele to this new product.

Caliber 3255

Secondly, Rolex tries to persuade consumers to buy their watches. By displaying all its competitive advantages, Rolex gains advantage over its competitors. These advantages include brand name, prestige of owning a Rolex, the ego satisfaction, as well as the super high quality of its watches.

Furthermore, Rolex reminds you that you are part of a selective group and you own a unique timepiece. By doing ads such as " The Rolex way", using acclaimed sports persons to talk about their watches and maintaining the leading position in the industry, they make a statement that costumers are making the right decision choosing Rolex.

Djokovic at the Rolex Masters of Monte Carlo

In conclusion Rolex uses fairs such as Baselworld to connect with the public, more specifically watch collectors and enthusiasts. This way Rolex exchanges information with their market and get feedback on their product. Increasing their relationship and improving their watches from the feedback.

Ch. 10 - Product Concepts

Rolex would be categorized as a shopping product. A expensive good, that usually gets compared to competitor brands before been purchased. In addition the watches are homogeneous products. They all have the same function, but at the end you don't necessarily go with the lowest-priced brand. In Rolex's case the costumer most likely will opt to buy a Rolex watch over his competitors because of the reliability and recognition of the brand.

Furthermore, Rolex watches can also go under the specialty products category. A person who wants to invest $ 10,000 and more in a watch most likely is looking for a very particular brand or model. Those watches are exclusive and bring with them a selective status.

Rolex triple date moon phase

The Company also has a quite nice product mix and offers different product lines: dress watches such as the Cellini collection or a sports line such as the Submariner and Daytona. Recently, Rolex has added some new products to a few collections such as the Yatch-Master in rose gold that has been really trendy these past few years.

In addition, Rolex is a global brand. The majority of its earnings comes from outside of Switzerland. Markets such as Asia, Europe and the U.S more specifically. 

As mentioned before the Rolex name was invented by Mr. Wilsdorf and is probably one of the strongest and boldest brand names in the world.  It is recognized everywhere as well the brand mark, the iconic Rolex crown. Those two elements by themselves indicate quality and are familiar to all costumers.

Ch. 17 Personal Selling and Sales Management

I believe purchasing a Rolex is a relatively easy buy. When one talks about a brand new Rolex one can talk about going to a store and how they will clear any questions one has related to the watch. Although watches can be a little bit more complicated when one talks about vintage or a rare time piece.

A watch sale gets more personal and more detailed when one is looking for a very specific watch.  For example, the Daytona Paul Newman. One needs to go to a collector or action house to find one. There one will have a much more detailed explanation as to why the watch is so iconic. A collector probably has more knowledge of the watch than a regular retail assistant, even though you are required to know the Rolex history in order to work at a Rolex store.

Qualified prospects, detailed explanation, and complexity of the goods are all factors of personal selling that are found in the watch industry sales force, but are better suited when applied to collective time pieces.

Detailed description of a "Paul Newman Daytona"

The experience of buying a unique watch includes all aspects of personal selling. 

On the video below one can have an idea of a detailed explanation that is expected when one has a personal selling experience buying a vintage Rolex. 

When one is selling a unique watch one defines sales goals. In the case of a Rolex watch one wants to sell it for the highest price possible and make the most profit. A good example of this is auction houses. 

In an auction house one will have extremely knowledgeable people trying to create the best deals. The same way an insurance company has a goal to sell $50 million dollars in life insurance, an auction house has a "quota" to achieve.

In conclusion, the sale of a rare watch hits every spot in personal selling and sales management. You need way more than traditional selling to sell these unique pieces and an extremely well define structure of sales management to achieve final goals.

Ch. 16 Advertising, Public Relations and Sales Promotion

Rolex's main advertisement tool is the name of the company itself. "Rolex" is a easy name to say and recognizable in any language. That is what the creator of Rolex Mr. Wilsdorf wanted back in the when the brand was created.  

The company also uses two major types of advertising. Institutional Advertising, to reinforce the "Rolex way" and the brand mission statement.  Additionally, Product Advertising that focuses on the qualities of a Rolex watch.

An advertising appeal identifies a reason for a person to buy a product. When someone buys a Rolex he or she expects to be part of a exclusive or unique group. 

Rolex uses different Executional Styles for advertising. Most of the time "Lifestyle" and "Testimonials" are used to promote the brand. The brand sponsors multiple celebrities and  spokespersons. One example is Roger Federer, one of the best tennis player of all time.

The company uses multiple channels to reach a vast but still specific market (audience selectivity) such as magazines, internet and Outdoor Media (sports events). 

As an example, GQ is a men fashion magazine that focus on men's fashion and lifestyle.  The person that buys that magazine is a potential costumer for Rolex.

Last but not least Rolex also uses Basel World, a watch show, to promote new watch models and calibers. Basel World is notorious for creating anticipation about new releases and technologies just as a Auto show does for cars. This year Rolex launched a new movement: the caliber 3255. A more precise movement that is more reliable and resistant. In addition Rolex released a few new Oyster models. That gives publicity to the brand and bring attention to the company in such a competitive industry.

Ch. 14 Marketing Channels and Retailing

The Rolex flagship store is located in the heart of the city. The store can be found on 5th Avenue and 53rd St. A strategic location that draws in many different customers.  

Rolex store 5 ave.

When you walk into the store the watches are in exhibited like art pieces. All lined up side by side so one has a clear view of options. The placement and display of the watches make them even more desirable.

Rolex uses one main Marketing Channel. Retailer Channel. Through its own stores Rolex sells watches in strategic locations such New York, Paris and London.

To increase profit Rolex also uses a Retailer Channel through authorized dealers all over the wold. Usually those authorized dealers are high end watch boutiques that serve the target market Rolex aims for.

Although Rolex has many stores and authorized dealers all over the world the distribution is quite selective and specific to certain areas.

The level of service either at a Rolex flagship store or at a dealer is often really high. Rolex will provide everything you need in order to be satisfied with your purchasing experience and the watch it self. In addition Rolex is a specialty store, dealing only with high end watches.

Because Rolex has many problems with replicas and fake watches the majority of sales are made in a physical store and rarely on the internet or via m-commerce. People usually use the internet to research about the watches before making the final decision to by the watch in a store.

Chapter 6. Consumer Decision Making

The first stage in the consumer decision-making is "need recognition". When a person wants to buy a Rolex, he or she is not only buying a watch to keep the time, but is looking for a watch that will perform and last for years; A watch that is recognized to perform impeccably.

As we all know Rolex is a renowned brand which has been around for over 100 years, delivering the best in the industry. When you go on an "external information research" about the watches you will see 99 % of the time that costumers are happy with the brand product, service and price offered. When you look for "internal information", you go to your dad, grandpa or a friend that owns a Rolex, and they will give you great reviews of the watch.

Furthermore, when you evaluate other alternatives such as Omega, AP and other luxury watches you will see that Rolex watches are the best bang for the buck. No other brand has the same recognition as a Rolex does. Price wise Rolex offers "reasonable" prices for luxury watches. A Submariner retails for 7,500$ when a PP Nautilus retails for over 26,000$ performing the same way.

Rolex reference 3525 chronograph

When you invest in a Rolex you expect that watch to last a lifetime and run in perfect condition. If anything happens to the watch you also expect that Rolex will do anything to replace or maintain that particular piece. Rolex watches are also an investment, which will increase the value over the years.

Rolex SA CEO - Jean Frederic Dufour

Buying a Rolex is also a statement. It means you can afford an expensive watch. Which includes the connotation that the person is successful at work or has achieved something great. Usually belonging to the upper class of a society.

Costumers vary from collectors who are enthusiasts and have a high involvement with the product or a person with high purchasing power that just wants a reliable watch. Another important factor is that Rolex watches are in families for many generations and people learn how to appreciate one from a young age.

Chapter 5. Developing a Global Vision

Rolex is the leading name in luxury wristwatches. Based in Geneva, Switzerland the brand relies on more than 4,000 watchmakers in over 100 countries. It is also ranked #72 on the Forbes World list of most valuable brands in the world. Rolex has been facing fierce competition world wide but remains the most recognized name in Swiss watchmaking.

When it comes to Global Marketing Standardization, the company doesn't produce different watches for each different market or country. Rolex sells standardized products world wide, because that's what Rolex clients expect from the brand. A person will be recognized by wearing a Rolex watch everywhere he or she goes in the world, a watch that is made with high quality parts, with unique features that are acknowledged from anyone that appreciates a nice timepiece.

Rolex went global long time ago. The profit margin for the brand hovers around 30% with sales estimated in 4.7 billion dollars.

The target market for Rolex is people with high purchasing power, that being said Rolex does its Global marketing in really specific countries, for example United States, China, Australia and so on. The brand tries to attract costumers from different parts of the world, one way of doing so is by sponsoring sports stars from different ethnic backgrounds such as Tiger Woods (USA), Roger Federer (Switzerland), Li Na (China) and etc. In addition Rolex makes partnership with big sport events, usually in countries where the company sales are higher. These events include Monte-Carlo Rolex masters, Rolex 24 at Daytona and Formula One. Those events are world renowned and attract the type of market Rolex targets.

Chapter 4. The Marketing Environment

Rolex has a really strong team of competitors against them, brands such as AP, Omega, Patek Philippe and etc, try to dethrone Rolex from the leading position in the watch-making industry by creating new watches and improving older models every year at Baselworld.

To maintain the the competitive advantage of the brand, Rolex tries to innovate through marketing research making the watches better and substituting what costumers dislike about past models. The submariner 116610LN model carries a ceramic bezel instead of an aluminium one, the new "Cerachrom" is scratch proof unlike the older aluminium version that wasn't a unanimity among its current costumers.

Usually a person that goes after a Rolex has a higher purchasing power and can afford to spend more money without jeopardizing their budget, these people have the ability to purchase higher-priced necessities . In addition many people look into buying a Rolex watch due to his or her lifestyle, these days collecting vintage or high-end watches became a profitable and exciting hobby for many people.

When it comes to ethnic market Rolex is "The gorilla in the industry" although it has lost space for brands such as Omega in the Chinese market (one of the biggest markets in the world), especially with the younger generations, Rolex still maintains the hegemony over sales.

“From a pure branding perspective, Omega have a very, very long way to go to get anywhere near Rolex,” said Jez Frampton, chief executive officer of brand consultant Interbrand. Interbrand estimates the Rolex brand’s value to have fallen 7 percent last year to $4.6 billion, making it one of the world’s top 100 brands. Omega isn’t within the top 150, Frampton said.

Chapter 3. Ethics & Social Responsibilty

Since 1976 Rolex has been playing a role of social responsibility through the "Rolex Awards".

A program that finances projects focused on improving lives and protecting the world's natural and cultural heritages. These projects touch all aspects of humanity by expanding knowledge or improving life on the planet.

Every two years an international jury of independent experts, which typically includes, scientists, educators, doctors and so on, nominates the Laureates. The award covers 5 areas:  applied technology, cultural heritage, environment, exploration and discovery, and science and health.

Dave Irvine is one example of how the Rolex Award helps people all over the world. He developed low cost LED's lighting sets after seeing kids struggling to read in a gloomy classroom in Nepal. Through his foundation "Light up the World" he has lit up the lives of over 700,000 people, installing around 30,000 LED's in poor homes and schools across 54 countries. Rolex funds were used to broaden the organizational structure of the foundation. 

Another example is Mr.Makoto Murase, also know as "Dr. Skywater.  His mission is to 

convince city-dwellers that rain is a good thing, not a water-disposal problem. He 

successfully change the regulations to require all large, new buildings to harvest sky water. More  than 500 buildings and houses in Sumida have installed his system. The water collected from rooftops can be used for gardening and etc.

Also in rural Bangladesh he's distributing low tech and low cost sky water  harvesting technology to spare families from water-borne infections and contaminated water.

Social responsibility plays a big role in the company. Over the years Rolex nominated 130 Laureates and support inspiring individuals to achieve great social and ethical goals all over the world. By promoting this award Rolex demonstrates responsibility and concern with the world's social and environmental issues, those can be viewed as an opportunity to help the world and build value at the same time.

Chapter 2. Strategic Planning for Competitive Advantage

Rolex is an established and respected company with over a 110 years as one of the top watch making companies in the entire wold. The company is well know for its innovations in the watch making industry, such as the first waterproof model the "Oyster" in 1926, the first watch to show two time zones at once the "GMT Master" in 1954 and the first watchmaker to earn the "chronometer" certification for wristwatches. That itself would give Rolex the "Competitive Advantage" in this industry, but Rolex goes beyond.

As a definition, "Competitive Advantage is a set of unique features of a company and its products that are perceived by the market as significant or superior to those of competition".

Rolex is committed to using the best technology and material available in the market to make its time pieces. "The Rolex Way" exemplifies the type of effort the company puts in making the watch a "perfect" watch, better than anything out there.

The Rolex Daytona, is one of  the top selling watches for Rolex. Made of 904L stainless steel, powered with the 4130 self-wind movement, reliable and efficient, this watch speaks for itself.








I believe that one of the product differentiation is the status that Rolex can bring with its name.  No one else has a bigger collection of "hits" in the watchmaking industry like Rolex does. Not to mention the excellent costumer service provided by the employees. Rolex is synonymous with "accomplishment" or "achievement." For example, when a guy graduates from college or on a 30 year marriage anniversary, a Rolex watch is the gift to give or receive.








Rolex are geniuses of their "marketing objective" and also their "target market strategy", the company promotes its products at high-end events because it targets their ideal customer economically and socially. Events like " The Australian Open", "Shanghai Rolex Master", "The U.S open" (golf), "Rolex Grand Slam of Show Jumping" (equestrianism) are attended by people with influence and purchasing power to boost the company's sales and popularity.

In conclusion, Rolex is a reigning leader in strategic planning making the company the top of watchmaking industry for well over a century. 

Chapter 1. History and Mission Statement

Brief History

1905
HANS WILSDORF
The history of Rolex is inextricably linked to the visionary spirit of Hans Wilsdorf, its founder. In 1905, at the age of 24, Hans Wilsdorf founded a company in London specialising in the distribution of timepieces. He began to dream of a watch worn on the wrist. Wristwatches were not very precise at the time, but Hans Wilsdorf foresaw that they could become not only elegant, but also reliable.
To convince the public of the reliability of his resolutely innovative timepieces, he equipped them with small, very precise movements manufactured by a Swiss watchmaking company in Bienne.


1908
GENIUS IN
FIVE LETTERS
Hans Wilsdorf wanted his watches to bear a name that was short, easy to say and remember in any language, and which looked good on watch movements and dials.
He said, “I tried combining the letters of the alphabet in every possible way. This gave me some hundred names, but none of them felt quite right. One morning, while riding on the upper deck of a horse-drawn omnibus along Cheapside in the City of London, a genie whispered ‘Rolex’ in my ear.”

1919

GENEVA

Rolex moved to Geneva, a city renowned internationally for watchmaking. Montres Rolex S.A. was registered in Geneva in 1920.

1926

THE FIRST

WATERPROOF WATCH

In 1926, the creation by Rolex of the first waterproof and dustproof wristwatch marked a major step forward. Given the name “Oyster”, this watch featured a hermetically sealed case which provided optimal protection for the movement.

1953

PIONEERING WATCHES

In the early 1950s, Rolex developed professional watches that served as tools and whose functions went far beyond simply telling the time. These watches were intended for professional activities, such as deep-sea diving, aviation, mountain climbing and scientific exploration. The watches generated lasting enthusiasm and became known as the watches of achievers.

THE SUBMARINER

Launched in 1953, the Submariner was the first divers’ watch waterproof to a depth of 100 metres (330 feet). Its rotatable bezel allows divers to read their immersion time

1956

LEADERSHIP

Rolex watches have long been associated with those who have, over time, guided the destiny of the world. No matter their vision, their domain of excellence, or their achievements, the one thing these exceptional men and women have in common is often their watch: the Day-Date.

And the Rolex legacy started... 

Mission

Look in all the dictionaries, there is no word for what we do. It's not ‘tradition’, though our craft is timeless. ‘Limitless’ is too limiting. ‘Enduring’ is not enduring enough. ‘Innovation’ can only begin to describe it. We sculpt, paint and explore. But explorers, sculptors and painters we are not. This is the only thing we make. The only thing we will ever make. There is no word for what we do. There's only a way. The Rolex Way.

The Rolex Way

 / ro • lex /:

1. A way of doing things unlike any other. 2. The way we make watches, the only thing we will ever make. 3.‘Precise’ is too imprecise for our attention to detail. 4. ‘Tradition’ is too conventional for the innovation we undertake. 5. We sculpt, paint and explore. But sculptors, painters and explorers we are not. 6. There is no word for what we do. 7.  There is only a way. 8. The Rolex Way.