Managing Brand Identity - Seiko and Grand Seiko
(Repost from my LinkedIn, thought someone may find it interesting)
As a senior marketing student, I've had a fascinating time applying my education to the brands I follow in my day-to-day. Perhaps no brand has provided a case study more intriguing than that of Seiko and Grand Seiko.
Seiko (and by extension Grand Seiko) was once the disruptor of the global watch industry, both challenging the Swiss dominance in sales and accuracy. Once the world's largest watchmaker, on the back of their breakthroughs in quartz movements, Seiko now faces a new set of challenges in segmenting their various brands to an increasingly luxury and brand-focused market.
As their president, Akio Naito, explained in an interview, summarized in the article below, Seiko must develop a strong image and differentiation between its brands if it wishes to stay relevant and match the growth of its competition in the U.S. and other foreign markets.
(Interview Linked with Post): https://www.ft.com/content/eabf51ad-4f94-4c99-a873-068451fc75f4
Grew up with a family basement full of old Hamilton pocket watches and advertisements. Guess that shaped me more than expected 😅.
Thanks for posting the article. Personally I am rooting for GS, there's an underdog tone to their story which I like even though Seiko is by no means a small company.
Yes, thanks for sharing and a good read. Can't help drawing an analogy to Japanese car brands like Honda, Toyota & Nissan and their resp Acura, Lexus and Infiniti offspring to create separation in price, luxury and value in their consumers. I don't think I have ever seen a both brand pos at one location. Would any big 5 Swiss brand sell a <$500 watch with their logo and expect business as usual? That's the mountain GS faces with their nameplate. A great topic to discuss, and can't wait to see how A. Natio approaches future growth.
As a senior marketing student, what do you think about Grand Seiko having the word "Seiko" in the name? I know the history of it, but would it have been better to give the Grand Seiko line a new name, kinda like what they did with Credor, to disassociate the public image of Seiko from Grand Seiko? Is it too late or not worth doing it now because of the difficulty/large marketing investment that would be needed? And how about Grand Seiko having their most unique characteristics like Spring Drive and Zaratsu polishing on regular Seiko models?
As a senior marketing student, what do you think about Grand Seiko having the word "Seiko" in the name? I know the history of it, but would it have been better to give the Grand Seiko line a new name, kinda like what they did with Credor, to disassociate the public image of Seiko from Grand Seiko? Is it too late or not worth doing it now because of the difficulty/large marketing investment that would be needed? And how about Grand Seiko having their most unique characteristics like Spring Drive and Zaratsu polishing on regular Seiko models?
I think the line is getting foggy for consumers. I forget the exact name of the concept, but Grand Seiko is likely experiencing some impact from the association with Seiko. Historically, from the Swiss Trial days, the name does a lot to tell the brand story of topping the swiss, but it's a story that G.S. doesn't very well communicate to the average watch buyer. I like the name due to its history, and it would be too late for a rebrand due to cost and the brand value it now carries. Though bringing back King Seiko in special edition Seikos is trying to reuse effectively the same story (the other factory) for a different purpose. Confusing if you ask me.
If anything, moving Seiko upmarket helps G.S.'s image. Still, I agree with concerns about taking the unique characteristics like Spring Drive, Zaratsu, and the same movements down to Seiko in many cases. The Prospects line is odd right now, with prices ranging from ~$500 to ~$6,000. If I were Seiko, I'd bring the finishing a quality assurance from G.S. but leave G.S.'s more expensive materials, movements, and special editions.
Viewing it as a case study, I'd "recommend" the following: Seiko, entry-level fashion, sports, and more casual dress watch topping out at $2,000, G.S. stainless sports and daily luxury from the $2,500 to $7,500 price range, and Credor in dress watches and really "high-end horology" models priced $9,000 to the moon. What do you think? Of course, this is viewing the brands as all under the same corporate structure, and they both are and aren't with G.S. becoming more independent... which may be why we see more overlap from pricier Seikos.
I think the line is getting foggy for consumers. I forget the exact name of the concept, but Grand Seiko is likely experiencing some impact from the association with Seiko. Historically, from the Swiss Trial days, the name does a lot to tell the brand story of topping the swiss, but it's a story that G.S. doesn't very well communicate to the average watch buyer. I like the name due to its history, and it would be too late for a rebrand due to cost and the brand value it now carries. Though bringing back King Seiko in special edition Seikos is trying to reuse effectively the same story (the other factory) for a different purpose. Confusing if you ask me.
If anything, moving Seiko upmarket helps G.S.'s image. Still, I agree with concerns about taking the unique characteristics like Spring Drive, Zaratsu, and the same movements down to Seiko in many cases. The Prospects line is odd right now, with prices ranging from ~$500 to ~$6,000. If I were Seiko, I'd bring the finishing a quality assurance from G.S. but leave G.S.'s more expensive materials, movements, and special editions.
Viewing it as a case study, I'd "recommend" the following: Seiko, entry-level fashion, sports, and more casual dress watch topping out at $2,000, G.S. stainless sports and daily luxury from the $2,500 to $7,500 price range, and Credor in dress watches and really "high-end horology" models priced $9,000 to the moon. What do you think? Of course, this is viewing the brands as all under the same corporate structure, and they both are and aren't with G.S. becoming more independent... which may be why we see more overlap from pricier Seikos.
That is a very good assessment, which I agree with especially how you divided the price points. Reading this did bring up an interesting marketing question. Grand Seiko sharing their unique characteristics with Seiko should hurt their own brand value, but does it increase Seiko's value? If it does and if that was the point does Seiko think that the perception of Seiko is good enough that people would actually be prepared to spend that kind of money and not think that “it’s just a Seiko”?
I have a hard time thinking that this strategy is blindly implemented, and there is most likely a financial reason as to the way this strategy was chosen. I don't see how this would save cost, so is this an attempt to bring Seiko upmarket to earn more profits at the expense of Grand Seiko? If BCG Matrix were to be used (I know it’s highly criticized, but just to get my point across) would Seiko be the Cash Cow and Grand Seiko the dog, and so by divesting Grand Seiko they fatten up the cow which is their breadwinner. However, this doesn't fit perfectly as Seiko has invested a huge amount of money into new calibers for Grand Seiko like the 9SA5, does this show that Grand Seiko is the star in the matrix and they are trying to bring both Seiko and Grand Seiko upmarket at the same time and does this even make any sense from a marketing perspective? Because it feels like they are both undercutting the value of Grand Seiko by sharing their characteristics while at the same time adding value with the new calibers, is this just a zero-sum game or have I totally lost it?
That is a very good assessment, which I agree with especially how you divided the price points. Reading this did bring up an interesting marketing question. Grand Seiko sharing their unique characteristics with Seiko should hurt their own brand value, but does it increase Seiko's value? If it does and if that was the point does Seiko think that the perception of Seiko is good enough that people would actually be prepared to spend that kind of money and not think that “it’s just a Seiko”?
I have a hard time thinking that this strategy is blindly implemented, and there is most likely a financial reason as to the way this strategy was chosen. I don't see how this would save cost, so is this an attempt to bring Seiko upmarket to earn more profits at the expense of Grand Seiko? If BCG Matrix were to be used (I know it’s highly criticized, but just to get my point across) would Seiko be the Cash Cow and Grand Seiko the dog, and so by divesting Grand Seiko they fatten up the cow which is their breadwinner. However, this doesn't fit perfectly as Seiko has invested a huge amount of money into new calibers for Grand Seiko like the 9SA5, does this show that Grand Seiko is the star in the matrix and they are trying to bring both Seiko and Grand Seiko upmarket at the same time and does this even make any sense from a marketing perspective? Because it feels like they are both undercutting the value of Grand Seiko by sharing their characteristics while at the same time adding value with the new calibers, is this just a zero-sum game or have I totally lost it?
You bring up a lot of good questions! I'm not entirely sure myself, personally I'd position Seiko as a cash cow but Grand Seiko seems more like a rising start to me (love that I'm actually using some terms from my classes irl 😂).
I don't it's entirely zero-sum, but if they get the target markets too close it may be (and they are certainly skating that line in some cases).
Great post and thanks for linking the article. I agree that part of GS' issues are their lack of good story telling. The Americans have typically been very good story tellers when it comes to marketing a product. I'd like to see GS hire some experienced American story tellers in the marketing space. GS has great heritage and it's going to waste!
Great post and thanks for linking the article. I agree that part of GS' issues are their lack of good story telling. The Americans have typically been very good story tellers when it comes to marketing a product. I'd like to see GS hire some experienced American story tellers in the marketing space. GS has great heritage and it's going to waste!
@doitforthedial totally agree there's a lot of talent in the U.S. for brand storytelling. I wonder if a lack of regionalization of marketing outside of Japan is why G.S.'s history doesn't seem to resonate as well as Omega's or Rolex's.
While I think their connections to Japanese nature and folklore are awesome, maybe American's could connect better with the history of Seiko's founder, Hattori, and the "bootstraps" story of taking on the Swiss.
I am constantly trying to reconcile this… on one hand, GS needs to aggressively remove itself from the Seiko Baggage (discount, department store, clearance sale, cheap offerings )… but can’t ignore the heritage and triumphs (quartz revolution, chronometer competition victories, innovative spirit, quest for perfection, endless firsts in the industry, pioneering spirit, and conquest in deep diving and mountain exploration etc)
especially if they hope to develop the sport line, they can’t disown the Seiko part of GrandSeiko that gave the world the first Titanium 600m diver…
it will definitely be a challenge to properly and believably own the good and ignore the bad… but this is what marketing is all about.
@doitforthedial totally agree there's a lot of talent in the U.S. for brand storytelling. I wonder if a lack of regionalization of marketing outside of Japan is why G.S.'s history doesn't seem to resonate as well as Omega's or Rolex's.
While I think their connections to Japanese nature and folklore are awesome, maybe American's could connect better with the history of Seiko's founder, Hattori, and the "bootstraps" story of taking on the Swiss.
Totally! I think it’s part of the Japanese Culture to have this humility, and not be boastful… the humble confidence is part of the Brand Identity that resonates with me, and a big part of why I love the brand… but there has to be a way to get those stories told without appearing as though the brand itself is blowing its own horn…
There are many people within the watch industry who have dicusssed all these issues in detail with the directors at Seiko accompanied by cups of coffee and/or shots of whiskey, but besides the humility of the Japanese, they are also incredibly stubborn, (politely) recalcitrant and highly resistant to change once thay take a position.
The official (internal) standpoint of the Seiko direction is that they want to be masters of everything, meaning: every pricepoint. They also in reality make the majority of their turnover as a result of the sales from lower price segements. In the entire Far East especially Seiko stands for a quality product in any price class, and this recogniton is extremely valuable.
The turnover from GS and Credor cannot and never will be able surpass that total price segment in which Seiko is king of the hill, despite the fact that each GS/Credor sold delivers an exceptionally higher profit margin per timepiece sold.... But any 'glory' from GS and Credor also shines down on the lower segment timepieces and creates status that supports the entire Seiko brand.
There are many people within the watch industry who have dicusssed all these issues in detail with the directors at Seiko accompanied by cups of coffee and/or shots of whiskey, but besides the humility of the Japanese, they are also incredibly stubborn, (politely) recalcitrant and highly resistant to change once thay take a position.
The official (internal) standpoint of the Seiko direction is that they want to be masters of everything, meaning: every pricepoint. They also in reality make the majority of their turnover as a result of the sales from lower price segements. In the entire Far East especially Seiko stands for a quality product in any price class, and this recogniton is extremely valuable.
The turnover from GS and Credor cannot and never will be able surpass that total price segment in which Seiko is king of the hill, despite the fact that each GS/Credor sold delivers an exceptionally higher profit margin per timepiece sold.... But any 'glory' from GS and Credor also shines down on the lower segment timepieces and creates status that supports the entire Seiko brand.
@theodore, thanks for providing that insight! The "masters of everything" mentality does show through in their wide breadth of assortment.
Seeing you have some experience in the industry from the Swiss perspective, would you say firms like Swatch Group or Richemont take a more segmented approach intentionally, or is it more an outcome of resource limitations?
@theodore, thanks for providing that insight! The "masters of everything" mentality does show through in their wide breadth of assortment.
Seeing you have some experience in the industry from the Swiss perspective, would you say firms like Swatch Group or Richemont take a more segmented approach intentionally, or is it more an outcome of resource limitations?
It is indeed intentional. When you discuss these very large groups, there are (essentially) 2 aspects to consider in relation to pricing/marketing (somewhat simplified here)
Hi, just new to this group so I hope you don't mind me commenting. I am a lover of Seiko watches (but own several other brands) , so if my comment sounds slightly biased towards the brand then I apologise. I do try to provoke conversation with the people I meet about the watches they are wearing and if I am being totally honest I am usually totally amazed by the lack of knowledge or interest some of these people show.
I speak as I find, I can't speak for anywhere else in the world but here in the UK G.S. do not interest the younger watch buyer, I'll use the age group of those approximately 40 yrs and below as a generalisation. Most of the people who I know, or have spoken to who own Rolex, Omega, Breitling have bought them because of brand popularity and familiarity, or a friend has one.
The more alarming thing I have come to realise is that a lot of the people who have bought these watches have not got the slightest idea what's inside their watch. By that I mean they know if they are automatic or quartz and that is it. I have had so many conversations where people have said to me "I have no idea what movement is in a watch" is unbelievable.
So speaking for myself as someone who knows the quality of the G'S watches and the movements contained within, unfortunately I believe it comes down to ignorance from a lot of watch buyers who associate the above mentioned watches as the be all, and end all of watch brands. Seiko somehow need to get watch enthusiasts, and those who just want a watch in that price range to pay attention to what their G.S range of watches are all about.
I personally would have a G.S over any of the above mentioned brands.
To be perfectly honest, I'm not sure that the main problem is the positioning between Seiko and Grand Seiko as different brands. It is from my perspective very easy to distinguish a Grand Seiko from a regular Seiko watch. The craftsmanship is clearly different, and what Grand Seiko has done from an innovation perspective is also another category.
I have a much harder time finding clear distinctions in Seiko's product lines, from the 5 Sports to the Prospex. This becomes even murkier if you consider Orient being part of EPSON, just like Seiko.
I know that Seiko has been pushing the Alpinist, but that is one of the few watches, where the value proposition is very clear above the 5 Sports line, yet the price range is huge in relative terms. I remember a lot of online discussions about Seikos entry-level watches becoming too pricey, but I'm unsure as to what else Seiko is about to do, when 3rd party manufacturers are offering low-end watches powered by licensed Seiko movements. (NH35, etc.)
There is not a very clear segmentation within Seiko's product lines, but I don't think it has that much to do with the naming of the brand itself.
To be perfectly honest, I'm not sure that the main problem is the positioning between Seiko and Grand Seiko as different brands. It is from my perspective very easy to distinguish a Grand Seiko from a regular Seiko watch. The craftsmanship is clearly different, and what Grand Seiko has done from an innovation perspective is also another category.
I have a much harder time finding clear distinctions in Seiko's product lines, from the 5 Sports to the Prospex. This becomes even murkier if you consider Orient being part of EPSON, just like Seiko.
I know that Seiko has been pushing the Alpinist, but that is one of the few watches, where the value proposition is very clear above the 5 Sports line, yet the price range is huge in relative terms. I remember a lot of online discussions about Seikos entry-level watches becoming too pricey, but I'm unsure as to what else Seiko is about to do, when 3rd party manufacturers are offering low-end watches powered by licensed Seiko movements. (NH35, etc.)
There is not a very clear segmentation within Seiko's product lines, but I don't think it has that much to do with the naming of the brand itself.
Totally agree with your analysis here, particularly with the "Prospects" line (including all three versions of the Alpinist) things get very confusing. While the "5" series has a pretty tight price range, finish level, and unified image the rest of Seiko varies a ton within each line.
To this day, I'm still confused about what the role of the Orient is within the Seiko-Epson group. Maybe it's supposed to play the King vs. Grand Seiko act to keep designers on their toes?... doesn't seem likely given the plethora of external competition.
Totally agree with your analysis here, particularly with the "Prospects" line (including all three versions of the Alpinist) things get very confusing. While the "5" series has a pretty tight price range, finish level, and unified image the rest of Seiko varies a ton within each line.
To this day, I'm still confused about what the role of the Orient is within the Seiko-Epson group. Maybe it's supposed to play the King vs. Grand Seiko act to keep designers on their toes?... doesn't seem likely given the plethora of external competition.
If you throw in variations through special editions, and dive watches being somewhat their own category, the picture is very blurred. Another aspect is that Seiko doesn't differentiate much through their movements. Unless you get into GS or certain dive watches, it's always their 4R/6R movements. (JDM watches seem somewhat more fluid in that regard.)
I very much agree with your statement on Orient. They are competitively positioned, and are addressing the same customer segment. I'm not sure what the overarching strategy behind this might be.
Hey all,
Agreed with all the insightful commentary above.
If you haven't already seen this, check this out. I think this picture is worth a thousand words.
https://www.fratellowatches.com/grand-seiko-fratello-paris-event-photo-report/
Even in spite of:
GS has somehow quietly managed to go from 23rd to 4th in overall revenue in the U.S. in 4 short years! (Their chart excluded Rolex, and simply says Rolex #1.)
From what I can gather:
In spite of all this, GS has gone from 23rd to 4th in 4 short years!
It would seem that the proof is in the pudding.
Per my user handle, I am an Omega fanboy, and always have been. And yet, my last 4 watch purchases have been GS. I love, love, love the James Bond affiliation, and the heritage, and yadda, yadda, yadda of Omega. And yet, in my lizard brain I also recognize that all of that is just marketing and manipulation - and, by the way, I love being manipulated and being marketed to. GS, on the other hand, has built a truly authentic diehard following, without any product placement, and without David Beckham whispering sweet nothings in my ear about how my watch was, "Born for a purpose..."
Like @Omeganut said 😎
Nothing succeeds like success. GS was well under the radar, even for watch enthusiasts, only five years ago. Whatever they're doing, it's working....
You bring up a lot of good questions! I'm not entirely sure myself, personally I'd position Seiko as a cash cow but Grand Seiko seems more like a rising start to me (love that I'm actually using some terms from my classes irl 😂).
I don't it's entirely zero-sum, but if they get the target markets too close it may be (and they are certainly skating that line in some cases).
I Like your price point idea for the brand, would help with clarity for consumers and it’s imminently logical.
But imminently illogical me: I’ve just ordered a 5k Prospex Lx spring drive. It’s zaratsu and finished at the GS studio … and pricier than many of the basic GS’s.…But with no GS demarcation.
yes I’m nuts 🥜. love is blind
I Like your price point idea for the brand, would help with clarity for consumers and it’s imminently logical.
But imminently illogical me: I’ve just ordered a 5k Prospex Lx spring drive. It’s zaratsu and finished at the GS studio … and pricier than many of the basic GS’s.…But with no GS demarcation.
yes I’m nuts 🥜. love is blind
I've tried one of those Lx models on, and honestly awesome pieces even if the price may confuse others. Enjoy it!