Rolex is a luxury Swiss watch company based in Switzerland. It was originally found in London in 1905 and registered as Rolex brand in 1908. The company is the subsidiary of Montres Tudor SA, who manufacture, designs, service and distribute the wrist watches. The company has two big brand names Tudor and Rolex. The Rolex watches are considered among most expensive watches across the globe. Its classic and extra luxurious features in the watches helps it making remarkable place in the industry (Rolex, 2020).
Ansoff matrix is a marketing tool used by the companies to plan their future growth according to the market and products prospect. The matrix suggests different growth strategies in combination of products and market to the companies for increasing the revenues and market share. Here is the detailed Ansoff matrix analysis of Rolex.
Market Penetration
The Ansoff’s matrix first quadrant suggests the market penetration strategy. This is mostly adopted by the companies who wants to increase the market share. This strategy focuses on penetrating in the existing market deeply with the existing products. This is the least riskier growth strategy for the companies. There are multiple ways of doing it. Companies start to adopt new pricing policies or aggressive advertising to increase the awareness among people. Rolex’s target or current market is the wealthy customers who can afford to wear luxurious watch, or customers who are so in love with watches that want to spend thousands of dollars on a watch. The Rolex develop its customer base who wait eagerly for the launch of the watches every year. The company benefits to its loyal customer in number of ways. It gives discounts, it made available the short stocked watches for their loyal customers (UK essays, 2018).
Product Development
Ansoff Matrix in the product development suggests the growth of market share by increasing the sales of new products in the existing market. To increase the market share, companies have to introduce new products in the market. It will be helpful in increasing the product portfolio. Companies like Rolex opts for this strategy as it has loyal customer base, who will buy the product no matter what’s the cost. The customers of the Rolex get to know the market saturation of its products, and that is when every year, Rolex launch its new collection. Rolex has introduced multiple products for this growth strategy for example, its sports model, Yacht master, submariner watch etc. The loyal customers will be benefitted to have quick access on the new models before it gets out of stock (Plopan, 2013).
Market Development
Market development is the growth strategy suggested by the Ansoff matrix. It focuses on selling the existing product in more different and new markets. This strategy targets on the market expansion of the company. The companies find the new markets for the expansion on the basis of geographic or demographic. Rolex is the swiss luxurious and expansive watches, branded as status symbol. Its customers are spread across the globe. Hence, the company has expanded itself across the globe geographically. However, Rolex should also expand itself on internet, like providing the service of buying from internet directly from its website. This will be the new market. Demographically, it is attracting men and women from different age groups (UK Essays, 2018).
Diversification
Diversification is a growth strategy suggested by the Ansoff matrix, where companies introduce in the new markets with new products. The companies start their operations in the industry or field where it was not operating before. Companies usually enter in new markets to mitigate the risk of loss and sharing of profit to larger area. This is the riskier strategy as compare to others. However, Rolex is not involved in any of the diversification strategy. The company could involve itself in different diversified markets, but it made it name in the watch industry and continued to do so (Rolex, 2020).
References
Plopan, J. 2013. Rolex Marketing Plan. [Online], Available at: https://www.slideshare.net/jplopan/rolex-marketing-plan, [Accessed on: 28th January, 2020].
Rolex, 2020. About the company. [Online], Available at: https://www.rolex.com/ar/about-rolex-watches.html, [Accessed on: 28th January, 2020].
UK Essays. 2018. Rolex Company Analysis. [Online]. Available at: https://www.ukessays.com/essays/marketing/study-on-the-rolex-company-product-marketing-essay.php?vref=1, [Accessed on: 28th January, 2020].