When talking about watch companies, two companies easily come to mind, Rolex and Hublot. Both Rolex and Hublot are Swiss companies headquartered in Geneva and Nyon, Switzerland, respectively, a country whose economy was once driven by the watch manufacturing industry. But in the 2010s, this trend has worsened. Global demand for wristwatches and chronographs has declined significantly, a fact that can be attributed to the growth of the smartphone industry. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original EssayAlthough there are still numerous opportunities that the watch manufacturing industry has not ventured into, there is promise that with effective use of marketing strategies, the industry, particularly these two companies, will be able to reach and tap into new markets. With the advent of the digital age, marketing has also evolved and is being conducted on digital platforms. How then can these two companies use digital marketing strategies effectively? This essay therefore presents an analysis of the digital marketing strategies used by Hublot and Rolex. Before analyzing digital marketing strategies, it is important to first understand the dynamics of the watch manufacturing industry, i.e. the opportunities and threats, and draw marketing strategies from these. As stated earlier, the main challenge facing this industry is the growth of the smartphone industry. Nowadays people conveniently check the time on their phones, which has led to a decrease in demand for watches. Smartphone companies such as Apple and Samsung have also introduced compatible smartwatches for use with their phones, further worsening the demand for luxury watches (Quora.com, 2016). Smartwatches continue to give luxury watches a run for their money as they come with more features that regular watches don't have. Luxury watches are also facing stiff competition from the jewelry industry. Although luxury watches are primarily used as high-end fashion accessories rather than for telling the time, they face competition from jewelry that continues to be innovative and offer more appeal to their customers. The customization features offered by jewelery are unrivaled in luxury watches and as such they continue to lag behind. The cost of producing luxury watches has also steadily increased over the years, due to the exorbitant prices these companies charge customers for their products. The playing field is therefore not level as smartphone companies continue to manufacture their products at relatively lower prices. To survive the digital age, some luxury watch companies such as Tag Heuer have collaborated with technology giants, Intel and Google, to produce luxury smartwatches (Quora.com, 2016). Despite the many challenges this sector is facing, there are numerous opportunities it can pursue. Collaboration with technology giants is a good example that could bring good news to the industry (Ryan and Jones, 2011). Luxury watch makers may also go after millennials who have continued to remain indifferent to their products. Customizing watches to meet millennials' specific tastes and preferences can engage them as potential customers. Rolex Founded in 1905 in London, United Kingdom by Alfred Davis and Han Wilsdorf, Rolex has grown to become synonymous with a leading watch manufacturing company luxury (Rolex,2016). With an estimated revenue of $7.7 billion and production of nearly 2,000 watches per day, the company is undoubtedly the leading manufacturer of luxury watches. The company is privately owned by the Hans Wilsdorf Foundation (Rolex, 2016). The company employs more than 2,800 people and boasts more than a dozen watch models. SWOT Analysis Being at the pinnacle of the watch industry, Rolex enjoys some opportunities and some threats that pose a challenge to its profitability. Below is an analysis of the strengths, weaknesses, opportunities and threats the company faces. Strengths Due to its long history of operation, the company enjoys an extensive global network of distribution and sales centers. The company also has an established domestic market which boosts its international sales. The company has also strategically positioned itself as a private company to enjoy grants and other financial incentives from the government (MBA Skool-Study.Learn.Share., 2016). Weaknesses The company's main weakness is its tax structure. Rolex operates on a global market and as such pays taxes to the governments of each country in which it operates. For a multinational company, it also has relatively small business units (MBA Skool-Study.Learn.Share., 2016).OpportunitiesThe company continues to design new watches and set trends for other companies in the industry to emulate. The company is also positioning itself to attract new markets, particularly the millennial segment. The company also enjoys a steady income from its business activities (MBA Skool-Study.Learn.Share., 2016). Threats The company was once considered a monopoly in the high-end watch manufacturing industry, but over the years the situation has changed with the entry of other companies such as Hublot, Breitling SA, Panerai and Omega SA. The growth of the smartwatch industry also continues to be a thorn in the side of the company's profitability. Other business risks, such as fluctuating interest rates and rising raw material costs, also threaten Rolex's success. Hublot Compared to other watch companies, Hublot is a rather new company. It was created in 1980 by Carlo Crocco, an Italian, who had left Breil watches to focus on his own design (Hublot.com, 2016). The company has grown in a short space of time to reach other leading manufacturers such as Rolex. It has more than 50 stores globally, strategically located on every continent. In 2008, the company was acquired by LVMH, a French luxury goods group for an undisclosed amount (Hublot.com, 2016). SWOT analysis. As a relatively new company, Hublot enjoys some opportunities compared to its competitors while the same competitors continue to pose a threat to its operations and profitability. The SWOT framework analyzes these opportunities and threats below. Strengths Hublot is revered for incorporating innovative materials into its design. Its scratch-resistant Magic Gold continues to be a force to be reckoned with globally. Its association with parent company LVMH gives it a competitive advantage that it could not have enjoyed on its own. It has also captured the market by sponsoring many events and being the official timekeeper of numerous sporting events (MBA Skool-Study.Learn.Share., 2016). Weaknesses The company and its brand do not have a strong presence in the market and its aggressive advertising has only increased the market's operating expenses. Opportunity. Opening boutiques selling its merchandise around the world can increase the company's market share and double or even triple its revenue. The company's presence in developing countries also hasimproved its sales (MBA Skool-Study.Learn.Share., 2016). Threats Similar to Rolex, Hublot and many other watch companies face stiff competition from smart watches. The company also faces internal competition in the industry from other manufacturers such as Zenith and Cartier. The presence of counterfeit and fake watches bearing its name in the market has also tarnished its brand image (MBA Skool-Study.Learn.Share., 2016). Comparison of digital marketing strategies used by Hublot and Rolex. Both companies, Rolex and Hublot have a strong online presence and continue to interact with their customers on social media platforms and market their products (Libert, 2015). Both companies' websites offer detailed information about their products, including their prices and their locations around the world. Hublot is creating a new website that will be dedicated to promoting the brand's culture and products. The website will offer consumers an in-depth look at the watches. It will have numerous product videos and blogs from both the company and other customers about their experience with the product. So how do Rolex and Hublot get their customers to visit their websites and get this information? Rolex and Hublot use search engine optimization (SEO) techniques and drive traffic from their social media pages to their websites. Search Engine Optimization (SEO) is the technique of making your website visible in search engine searches without necessarily paying the search engine. With SEO, the marketing team ensures that their website is among the top unpaid results (Libert, 2015). Market Positioning and Differentiation Market positioning and differentiation are two very critical elements in any marketing strategy. Market or product differentiation is the process of distinguishing one's product from a similar product in the market (Chaffey et al., 2014). It may involve adding features to the product to separate it from the rest. Market or brand positioning involves introducing the product to the market and securing a spot or position for the brand in the market (Chaffey et al., 2014). Positioning will involve any attempt to endear the product to the market. Rolex differentiates its watches as high-end luxury products that resonate with the rich and famous. They take time to manufacture their products and customize them to the specific tastes and preferences of the wealthy (Rolex, 2016). For example, most watches produced by Rolex are water resistant, which is an uncommon feature on the market. They usually have a high price but are worth it. They are sophisticated yet elegant and offer value for your money (Rolex, 2016). Rolex has therefore positioned itself at the highest end of the market segment, i.e. the market for the rich. On the other hand, Hublot continues to produce exquisite watches that even middle- and low-income people in society can enjoy. Hublot, compared to Rolex, uses cheaper raw materials to manufacture its products, which explains their relatively lower prices. They are also opening stores in developing countries to give them a taste of the developed world at affordable prices. Use of social media platforms. As stated earlier, both companies have a strong online presence in social media platforms such as Facebook, Twitter, Instagram, and Google Plus. However, there is no doubt that Rolex has a greater command over these platforms than Hublot. For example, Hublot only has 1.18 million followers on Facebook compared to Rolex's 5.5 million. However, the use of these platforms is relatively similar.