By Salma Awwad
Gap between mega watch brands Rolex and Omega is shrinking as the former takes the fight to the F1 racetrack
On the opening day of the Basel World watch fair this year, Digital Luxury Group (DLG) released a report confirming that the gap between luxury watch makers Rolex and Omega is getting smaller every year. The difference went from 8.4 percent in 2009 to a mere 2 percent in 2012, proving that Omega’s strategy to improve the brand’s positioning is paying off.
In 2012 Omega sponsored the London Olympics and boosted its plan to become Rolex’s biggest direct competitor by placing an aggressive campaign around Skyfall, one of the highest-grossing films in the James Bond franchise.
According to David Sadigh, the founder and CEO of DLG, Rolex’s recent deal to become Formula 1’s world-wide partner and official timepiece was a key decision intended to prevent Omega from surpassing its position.
The Financial Times reports that the deal is believed to be worth $35m a year for ten years.
In Brazil, one of the world’s most important emerging economies and the biggest market for F1 fans globally, the four most-searched-for timepieces are motorsport watches, with the Rolex Daytona coming in third and Omega’s Sea-master securing the fifth position according to the World Watch Report.
Brazil’s importance is magnified by the fact that it is hosting 2014 World Cup and the 2016 Olympics. Omega has been a global Olympic games partner and in 2016, it will retain that position by being the official timekeeper at the Rio games.
Brazil is certainly shaping up to be an important battleground for the two brands and Sadigh sees this deal as a move to protect a strategic watch-advertising territory, and for Rolex to reinforce its leadership in the industry. Building global awareness and boosting demand through F1 sponsorships is a guaranteed strategy that has paid dividends in the past for many watch brands.
Just last year, IWC’s entry into the F1 arena was announced and the company is now the official engineering partner to the Mercedes AMG Petronas team. Yan Lefort, IWC’s sponsorships and partnerships manager stated: “Ten years ago IWC was a local brand. Now it’s global, thanks to partnerships with sports such as the Volvo Ocean Race and Formula 1.”
For watch brands in general, motorsport is an essential field in which to grow and ensure international exposure, but for Rolex, securing this deal over its other competitors is an aggressive attempt at retaining its global top spot.For all the latest fashion trends from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
This reads more like a press release than substantive news or analysis. For example, what is the basis for so-called "gap" here? Unit sales? Brand awareness? Price? Margin?
And who or what entity are we supposed to believe that DLG has "confirmed" here? Implied by claim of confirmation is that something was out there to be confirmed in the first place.
Finally, as author-creator of JamesBondWatches.com, let me assure you that product placement in a single James Bond movie (Skyfall) can hardly be a significant factor in reducing any alleged gap by 75% between Omega and Rolex. Having conducted my own original research directly on this point, I've never seen cooperative marketing vix 007 films to have anything like this sort of brand-switching impact.
Love it, will be interesting to see how the luxury watch brand Rolex stacks up.