Rolex Brand Repositioning: A Strategic Analysis and Recommendations

This report provides a comprehensive analysis of the Rolex brand, focusing on its current positioning, market trends, and the challenges it faces in the luxury watch industry. It explores the company's background, brand positioning, and the evolving trends in the watch market, including the rise of smartwatches and digital displays. The report identifies key issues, such as high pricing and a lack of innovation compared to competitors like Casio and Hublot. Recommendations are offered to address these challenges, including re-evaluating goals and objectives, identifying direct competitors, evaluating R&D capabilities, implementing value-based positioning, and setting a new brand positioning strategy. The report concludes with a discussion of limitations and provides references to support its findings. The report suggests that Rolex needs to adapt to changing customer behaviors and incorporate more technological advancements to maintain its market position and expand its customer base. The report highlights the importance of identifying the competitive landscape, introducing new products in the form of smart watches and its specifications, and incorporating value-based positioning.

Running Head: ROLEX BRAND RE-POSITIONING
ROLEX BRAND RE-POSITIONING
Name of the Student:
Name of University:
Author Note:

1ROLEX BRAND RE-POSITIONING
Table of Contents
Introduction......................................................................................................................................2
Organisation background.................................................................................................................2
Positioning of Rolex........................................................................................................................3
Current trends in Watch industry.....................................................................................................4
Issues in Rolex.................................................................................................................................5
Recommendations............................................................................................................................5
Identifying new goals and objectives......................................................................................5
Identifying the direct competitors............................................................................................6
Evaluating the R&D abilities...................................................................................................6
Implementing value based positioning....................................................................................7
Setting brand positioning strategy...........................................................................................7
Limitations...................................................................................................................................8
Conclusion.......................................................................................................................................8
Reference.......................................................................................................................................10
Appendices....................................................................................................................................12
Appendix 1.................................................................................................................................12
Appendix 2.................................................................................................................................12

2ROLEX BRAND RE-POSITIONING
Introduction
Rolex is considered to be one of the renowned and popular watch brand across the world
popularised with its premium products with high range. The company is categorised with the
luxury watch manufacturing with a close focus on the innovation and the quality of its watches.
The royal beauty with exotic looks make Rolex to get a distinguished position in the
international market. Sponsorship in different important sports events like the international tennis
event, it becomes one of the important watch manufacturer across the world. Based on the
popularity and its successful business orientation, Rolex ranked world’s 71st most valuable brand
in the year 2018 (rolex.com, 2019). The Rolex Daytona is considered to be the second most
expensive watch ever sold in an auction with a worth of US$17.75 million in New York in 2017
(fhs.swiss, 2018). Therefore, it can be claimed that the company has a great deal of market
capitalisation as a premium and world class wristwatch manufacturers.
Based on this understanding, this report is going to find out the existing trends in the
watch manufacturing market and the issues that Rolex is either facing or can be faced in near
future due to its current brand positioning. Moreover, a recommendation part is also discussed in
reference to the issues of Rolex and a mitigation strategy that the organisation should follow in
order to resolve the issues efficiently.
Organisation background
Rolex is a Swiss luxury watchmaker based in Switzerland. The company was founded in
London in 1905with the name of Wilsdorf and Davis. However, in 1905 the company was
registered with the name of Rolex in 1908 (rolex.com, 2019). As far as the motto of Rolex, the

3ROLEX BRAND RE-POSITIONING
organisation is entitled to offer exotic and premium watches to rich customer. The organisation
follows the marketing strategy of putting high interests on the rich customers with variety of
product range for men and women. The annual revenue of the organisation in 2016 was
estimated $4.6 billion so that it proves the magnanimity of the organisation (rolex.com, 2019).
Therefore, the expansion and the dynamics of the organisation highlights its range of customers
and the pricing strategy that it associated with high creativity and innovation.
Positioning of Rolex
Brand positioning of Rolex is no longer into a traditional way of attaching the analogue
watches only. It is important for the organisation to deal with the practice of delivering products
in a unique and creative manner that will blend fashion with the watch making. There are
certainly a number of innovative ideas that the Rolex management and R&D team have been
incorporated in course of the business (Westjohn et al., 2016). For an example, waterproof case,
perpetual rotor, Oyster case, purest and finest materials and the quality control. The price of the
Rolex watches are highly innovative that the company is trying to maintain by introducing
different technologies like the self-winding movement, independent control over the Suisse des
Chronometers and the testing (rolex.com, 2019). Those initiatives and innovativeness are highly
and intricately associated with the brand value and image of Rolex as a classic, royal and retro
getup.
However, the brand positioning of Rolex is not up to the mark as it is expected to get
adequately marketization. One of the major factor is its pricing strategy that only enables the rich
people to buy Rolex watches. On the other hand, the transformation of watches and upgrade it

4ROLEX BRAND RE-POSITIONING
with the current trends in organisation also delivers a greave problem for Rolex to sustain in the
highly competitive market.
Current trends in Watch industry
As per the report of Donzé (2019) it can be stated that the current watch industry is
highly moved with the incorporation of advanced technology. For instance, companies like
Casio, Hublot and FitBit are running ahead of Rolex in terms of their popularity and
maximisation of customers. One of the major reasons behind such setback is the failure to adapt
the change in the customer behaviour. While researching on the aspects of customer behaviour,
Maravilhas, Oliveira and Melo (2018) articulated that the current trend within the watch industry
has become more tech savvy and digitisation of the industry influences the customer to a great
extent that they are now looking for smart watches with digital display. As a result of that it
becomes an important aspect for the watchmakers to focus on the customer behaviour
extensively.
Apart from that high pricing is also considered to be an important aspect for the business
organisations in order to bring efficacy into the organisational practice. From the research of
Kern (2017) it can be advocated that the cost leadership pricing strategy was undoubtedly one of
the most effective strategies that the corporate organisations should follow in order to maximise
the customer base. The research of Schluep and Aerni (2016) asserted that the cost leadership
approach is currently using by most of the watch manufacturer in order to maximise its customer
base.

5ROLEX BRAND RE-POSITIONING
Issues in Rolex
In case of Rolex both the pricing strategy and the lack of innovativeness costs huge
disparity into its existing organisational objectives and the real case scenario. As far as the
pricing strategy of Rolex is concerned, it can be stated that the company follows a high pricing
strategy where the rich people only able to buy the Rolex products. It is true that the quality of
the Rolex watches are of premium quality but the high pricing strategy restricts the customer
base to a certain class of people (Corder, 2018). This will procure a limitation for Rolex to
expand its market further.
On the other hand, it is also essential for Rolex to adapt the changes that the current
watchmakers are following. As a matter of fact, uniqueness is also a key feature that innovation
in business can follow. It can be argued that Rolex fails to diversify its products and as a result of
that restriction into the existing customer base is evident (Corder, 2018). Despite of having value
into the existing market, it is next to impossible for Rolex to bring more customers into the
organisational fold.
Recommendations
In this regard, there are some important measures that Rolex should take in order to
secure its business orientation sustainably in the international market.
Identifying new goals and objectives
It is important for Rolex to re-evaluate its existing mission and vision and makes it more
reliable with the current situation. In this regard, Munz (2018) articulated that the mission and
vision of an organisation provides a guidance to the companies so that they can deal with the
practice effectively and efficiently. As a matter of fact, for Rolex, the change in the market also

6ROLEX BRAND RE-POSITIONING
pushes the company to understand the demands in the market and reinvigorate the position in the
market with maximising its customers and generating the organisational value. However, before
making any stern decision identifying the goals and objectives of the organisation on the basis of
the issues can be a strategic advantage for Rolex to set some targets and follow those goals in
order to establish a good and better organisational practice (Donzé, 2017).
Identifying the direct competitors
It is also essential for Rolex to identify the direct and immediate competitors who are
manufacturing same type of products that Rolex is offered to its customers. Binz and Truffer
(2017) advocated that identifying the competitors would provide an effective manner to the
business enterprises to understand the position of the organisation within the competitive market
and also identified the position of the direct competitors and their strengths to encapsulate the
market. As a result of that Rolex should also put emphasis on its immediate rivals like Hublot,
Casio and Tag Heuer and find out the possible strategies that those companies are made and the
way they are capitalising the market. It is undoubtedly an important lesson for Rolex to
understand the market trends where not only the demand of the customers are considered to be
the important parts only rather it is also the role of the watchmakers to influence the customers to
a great extent (Adina, Gabriela & Roxana-Denisa, 2015). Therefore, introducing new products in
the form of smart watches and its specifications are also under firm scrutiny of Rolex before they
are going to the take decisions for introducing new innovation in its business practice.
Evaluating the R&D abilities
The abilities and adaptability of the R&D team is also identified as one of the important
aspect that will bolster the new incorporation of the new innovation into Rolex. Halkias,
Davvetas and Diamantopoulos (2016) argued that the introduction of new technologies and

7ROLEX BRAND RE-POSITIONING
product development cannot be successfully happened without having a creative and strong
R&D unit. Therefore, it should be one of the initial measure that the Rolex management will take
in order to introduce the initiatives to make smart watches for the first time. It requires in depth
analysis and knowledge of the digital system. As a matter of fact, the market trends and
innovativeness are also coupled with the operation of the R&D team. They are playing the vital
part to put unique value for the new product so that the company can get enough limelight and
appreciation from the customers. The brand value of Rolex is definitely high enough that can
create a unique value position for the company in the competitive market. Nevertheless, it is also
essential for the R&D unit to make the product so innovative and unique that provide a
competitive advantage for Rolex.
Implementing value based positioning
The role of the value base positioning is also essential for Rolex because of establishing
the brand positioning of the organisation properly. From the research of Heinberg, Ozkaya and
Taube (2017) it can be derived that it is not always possible for the business organisations to
introduce new products all the time. In most of the cases the companies are trying to develop the
same brand but in an advanced level with the help of different advanced technologies. One of the
primary interests of this slight differences is to make a difference in products and provide some
new features that can attract more customers (Chang & Jai, 2015). For Rolex also the value
based positioning seems an important part in order to set a unique value for the new introduction
and as a result of that it will provide adequate exposure to the new product of Rolex.
Setting brand positioning strategy
The brand positioning strategy is associated with the pricing and quality strategy (Lee,
O’Cass & Sok, 2017). Premium quality is considered to be one of the key features that Rolex

8ROLEX BRAND RE-POSITIONING
follows and the company is looking to retain its image properly. The pricing strategy of Rolex
has to be focused on the market trends and should be moderate enough to attract normal
customers. Therefore, a sharp change will be implemented in the target market where the
expected customers for the new Rolex watches are no longer fixed with the rich people. Middle
Class families are also getting incorporated into the positioning strategy of Rolex.
Limitations
Despite of all the efforts it can be stated that there are some limitations that the
recommendation part is failed to address. The limitations are as follows,
 Introducing new products for re-positioning of Rolex is definitely a cost driving initiative
that can create problem for the company.
 The ability of the R&D team is also under supervision. Manufacturing smart watches
with digital display was never done by Rolex. Therefore, it is a challenge for the
organisation to put great thrust of such a measure.
 There are uncertainty that the new changes are definitely bring organisational
profitability through maximisation of customers. The psychology of the current
customers has to be taken under consideration.
Conclusion
The above discussion tries to put a great deal of emphasis on the current issues that Rolex
is facing. In this regard, this report emphasises on the brand re-positioning of Rolex through
introducing new products as the smart watches with digital display. Moreover, it is also essential
for the organisation to changing its pricing strategy of premium pricing for specific products.
However, the limitations of the recommended measure could bring obstacle to the success of the

9ROLEX BRAND RE-POSITIONING
company. Therefore, it is essential for Rolex to consider and aware of those limitations.
Henceforth, it can be concluded that the recommended measures can bring repositioning of the
brand Rolex effectively and adequately.

10ROLEX BRAND RE-POSITIONING
Reference
Adina, C., Gabriela, C., & Roxana-Denisa, S. (2015). Country-of-origin effects on perceived
brand positioning. Procedia Economics and Finance, 23, 422-427.
Binz, C., & Truffer, B. (2017). Global Innovation Systems—A conceptual framework for
innovation dynamics in transnational contexts. Research Policy, 46(7), 1284-1298.
Chang, H. J., & Jai, T. M. (2015). Is fast fashion sustainable? The effect of positioning strategies
on consumers’ attitudes and purchase intentions. Social Responsibility Journal, 11(4),
853-867.
Corder, R. (2018). Authorised dealer says Rolex hysteria is being driven by flippers and internet
forums - WatchPro. Retrieved from https://www.watchpro.com/authorised-dealer-says-
rolex-hysteria-is-being-driven-by-flippers-and-internet-forums/
Donzé, P. Y. (2017). The transformation of global luxury brands: The case of the Swiss watch
company Longines, 1880–2010. Business History, 1-16.
Donzé, P. Y. (2019). Dynamics of Innovation in the Electronic Watch Industry: A Comparative
Business History of Longines (Switzerland) and Seiko (Japan), 1960-1980. Essays in
Economic & Business History, 37.
fhs.swiss. (2018). Federation of the Swiss Watch Industry-Annual Report 2017. Retrieved from
https://www.fhs.swiss/file/6/Annual_report_2017_web.pdf

11ROLEX BRAND RE-POSITIONING
Halkias, G., Davvetas, V., & Diamantopoulos, A. (2016). The interplay between country
stereotypes and perceived brand globalness/localness as drivers of brand
preference. Journal of Business Research, 69(9), 3621-3628.
Heinberg, M., Ozkaya, H. E., & Taube, M. (2017). The influence of global and local iconic
brand positioning on advertising persuasion in an emerging market setting. Journal of
International Business Studies, 48(8), 1009-1022.
Kern, G. A. (2017). Engineering the Intangible: Strategic Success Factors in the Luxury Watch
Industry. In Evolving Business Models (pp. 153-180). Springer, Cham.
Lee, W. J., O’Cass, A., & Sok, P. (2017). Unpacking brand management superiority: Examining
the interplay of brand management capability, brand orientation and
formalisation. European Journal of Marketing, 51(1), 177-199.
Maravilhas, S., Oliveira, S. R. G., & Melo, P. (2018). Competitive Intelligence and Technology
Watch From Patent Information to Leverage Innovation. In Handbook of Research on
Strategic Innovation Management for Improved Competitive Advantage (pp. 247-268).
IGI Global.
Munz, H. (2018). Crafting time, making luxury: the heritage system and artisan revival in the
Swiss watch industry, 1975–2015. In Global Luxury (pp. 197-218). Palgrave, Singapore.
rolex.com. (2019). About Rolex Watches. Retrieved from https://www.rolex.com/about-rolex-
watches.html
Schluep, I., & Aerni, P. (2016). When corporatism leads to corporate governance failure: the
case of the Swiss watch industry. Schluep Campo, I. and Aerni.

12ROLEX BRAND RE-POSITIONING
Westjohn, S. A., Arnold, M. J., Magnusson, P., & Reynolds, K. (2016). The influence of
regulatory focus on global consumption orientation and preference for global versus local
consumer culture positioning. Journal of International Marketing, 24(2), 22-39.
Appendices
Appendix 1
Figure 1: Swiss Watch exports
(fhs.swiss, 2018)

13ROLEX BRAND RE-POSITIONING
Appendix 2
Figure 2: Exports of Swiss wristwatches
(fhs.swiss, 2018)