The watch market is a highly established industry. Watches are positioned by style in the various niche markets: causal, sporty, formal, semi-formal and jewelry (Faleiro). The importance of watches as style and fashion has led to the brand of watches being an important attribute of the watch (Faleiro). Many watch companies capitalize on most of all the differentniche markets. For example, the Swatch Group which is a major player in all market segments with gross sales in 2002 at 4 billion Swiss francs (swatchgroup.com) They have 14 different watch brands that each position themselves on different fashion and price segments of the market (www.swatch.com). However, Swatch Group has seen a decrease in profits in 2003, reflecting the slowing of growth in maturewatch markets (Xinhua). Furthermore, most watches sold in Australia are imported and imports from Swiss watch makers have declined in Australia by 11.4% in recent years (www.fhs.ch).
††††††††However, Australian surf companies who produce sporty and casual watches such as Billabong and Ripcurl have seen tremendous growth. The surf industry is a $10 billion industry (Kotdin). Billabongwhich is Australia's leading surf wear company saw a 9% increase in sales in Australia totaling near $170 million in 2003. Moreover, Billabong operates globally with 30,000 stores selling Billabong products.
SALES 2003 (millions)
Billabong's world market saw an even greater growth of 24% in sales (www.billabongcorporate.com).Their products include women and men's clothing, swimwear, bags and backpacks, hats and toboggans, gloves and boots, wetsuits, surf and body board covers, belts and not to forget, watches.
They continue to expand their brand image with promotional events. They sponsor surfing and snowboarding events worldwide and also sponsor some of the athletes. Billabong has also created the film "Blue Crush"which features a female pro surfer to attract the female segment of the market.
Billabong is perceived as youthful, cool, fun, and trendy beach wear apparel to customers and markets to all active people but their main market segment is the 15-30 year olds (Driscoll 2004). Their image is associated the traditional Australian image of the beach lifestyle. According to an article in TheAge, "cool consumerism" is dominating the market. People want to lead a cool lifestyle and Billabong is seen as providing it (Gettler). Although surfing was the central image of the company it has expanded its image to snowboarding and now focuses on an extreme sports image (www.billabongcorporate.com). The fashion of Australia is still based around the surfing industry and they have grown up withthe brand and identify with it (the Bulletin). Brand identity can strengthen a company and the Billabong brand has become known around the world to the active youth and their strong brand identity is one of the most important attributes (www.bandt.com.au/news/76/0c009676.asp).
††††††††Watches are not Billabong's most popular or profitable item (www.billabongcorporate.com). We see an opportunityto introduce a women's all-sport watch to cater to all the active women who buy Billabong products. Billabong currently has a male surf watch but most of the female watches are fashionable and are not made to be used as a practical device in water or snow. Women's surfing is growing tremendously and Australian women are leading the pack (Hamilton). Moreover there are a growing number of women insport in Australia, according to the Australian Bureau of Statistics, 80% of 18-24 year olds participate in a sporting activity and 56% of women also participate (Australian Bureau of Statistics).The women's market in the surf industry is growing and they are on average spending more than men in this in market (Griffin (a). They are also huge spenders in the sport industry, spending close to 75%...
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