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Academic’s insight | Rolex brand marketing strategies

Rolex headquarters @ Zone Industrielle Praille-Acacias-Vernets @ Genève - Rolex Brand Marketing Article

Rolex is one of the most iconic brands ever, being ranked as the world’s most valuable brand last in 2022 (RepTrak, 2023), and is synonymous with the idea of a luxury watch. This achievement, Rolex claims to be due to their “values of perfection and culture of continuous improvement. “(Corder, 2022) 

For some quick fun facts on Rolex, you can check out our article titled: 29 Fun Facts About Rolex You Need to Know.

In its over 100 years of history, the company has seen a lot of ups and downs, witnessed two world wars, and, significantly for our paper, survived the quartz crisis. A technological advancement so seismic in nature that it nearly eroded the Swiss watch industry.

Following a short historical background on the crisis and its impact on the watch industry, we will analyse the old Rolex. Next, we will assess some of the intricacies that one subjects itself to when entering the luxury market. 

How has Rolex used exclusivity and advertisement with a focus on testimonials by sports figures to gain a foothold in the luxury market?

The Quartz Crisis

The history of Rolex can be, in its most loose sense, split into two time periods. The time before the quartz crisis and the time afterwards. The quartz crisis refers to the 70s and 80s when a technological shift threatened the existence of the traditional watch industry. It is estimated that of 90,000 people employed in the industry in 1970, only around 30,000 were left in 1984 (Appendix C).

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Appendix C: Employees in Swiss watch Industry, 1970-2008 – Source: La Convention patronale de l’industrie horlogère Suisse & Raffaelli, 2013

Its origin can be traced back to Rolex’s biggest rival in the east, the Japanese manufacturer Seiko. In 1964 they became the timekeeping sponsor for the Tokyo Summer Olympics. Eager to make the most out of the opportunity and with sights on expansion and becoming a global brand, they developed the quartz technology for measuring the athletes (The Seiko Museum, 2023). 

While expensive and clunky at first, by the late sixties, the first wristwatch version where available with a quartz movement. By the mid-70s, they started to become cheaper and more widely available. In the early 80s, the Casio G-Shock arrived, which made quartz quasi-unbreakable and highly functional (G-Shock, 2023). Latest by that point, the mechanical watch was inferior in every metric.

This evolution can also be captured in numbers. A mechanical watch tends to have a power reserve measured in days, while quartz watches can easily go years between a battery change (Lombardi, 2011, p.47). Rolex prides itself on being accurate to within two seconds per day, but even the cheapest quartz is accurate to 0.5 seconds a day (ibid). Finally, quartz watches can be built so cheaply that for most consumers, it is cheaper to buy a new watch than to repair a broken one.

The Rolex of Old

A market is all the people or organisations that have a demand for a product within a certain category as well as the ability, willingness, and authority to purchase those products. For Rolex, that market was the tool watch market. Tool watches were those that did more than tell the time, fulfilling specific customer use cases of fantasies (Yiannopoulos, 2016). 

This fit well into the product line of Rolex, with a catalogue of models made for professionals who required accurate and reliable timepieces with added functionality. The famous Submariner was made for divers, the iconic GMT-Master for pilots, and the Daytona for racing drivers. 

Their competition where other quality watch manufacturers within Switzerland that produced watches satisfying those specific needs. Divers could consider a Blancpain Fifty Fathoms. Pilots could choose a Breitling Navitimer. For race drivers, the Omega Speedmaster was an option.

While a quality product demands a certain price, and wealthy people appreciated Rolex and their products, their approach was premium, and their focus was on professionals. An important testament to their quality intended use case was Rolex watches being a favourite among the military, which was seen as the ultimate durability test for any watch (Altieri, 2022).

A great reflection of this approach can also be seen in the “If you where” advertisement campaign (Appendix F & G). The advertisement was directly targeted at professionals and those wishing to emulate them. It offers a great insight into who Rolex thought of when picturing their customers.

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Appendix F: Old Rolex Advertisement 1

Their unique selling proposition, key distinguishing factors that signify a benefit to the customer intended to draw them to the brand (Stone & Desmond, 2007, p.203), focused on the high quality of their timepiece (Donze, 2017). They were both reliable and accurate. If you were in a situation where you relied on your wristwatch, then their brand story was that it will be well worth spending the extra money to get a quality product that won’t give up on you when you need it most.

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Appendix G: Old Rolex Advertisement 2 & 3Source
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While dress watches, more classical timepieces where function follows form, are part of Rolex’s business their competitive advantage, having above average profitability or a strategy others can’t replicate, was within the tool watch segment.

The arrival of quartz shifted the competitive advantage towards Japanese manufacturers. Their competition was no longer other traditional Swiss manufacturers but instead cheap plastic watches like the Casio G-shock, which ended up replacing Rolex as the timepiece of choice for soldiers (Yiannopoulos, 2016). In this new segment, all their acquired knowledge for the construction of the movement proved useless.

Rolex had two options: A race to the bottom for who could produce cheaper watches or a complete market change. Rolex chose the latter.

The Luxury Market and its Pricing Dynamics

While Rolex had a stellar reputation in terms of its quality, this does not directly equate to luxury. This begs the question of how a luxury brand is created, if not merely through its quality. What need is being satisfied in the world of luxury?

A key factor for understanding both the idea and the power that luxury can have is tied closely to the concept of status. Luxury goods can be viewed through the lens of social hierarchies. They can function both as a signalling good for customers to show their current status, as well as for those wishing to present their desired status (Morhart et al., 2020, p.76).

One favourable distinction of the luxury market that bears attraction to the business of Rolex is its special relationship with price. As Rolex gained awareness that they lost their competitive advantage to Seiko, they decided to forego their premium watches in favour of luxury. This is because while for premium products, increases in price have to be justified, within the luxury market, prices aren’t questioned as the products are more treated akin to art where there is no clear relation between the production costs and the consumer price. (Kapferer & Bastien, 2012, p.485).

A reflection of the new philosophy of luxury Swiss watchmaking can be found in the following statement:

“as the price of quartz movements declined by a factor of 100, beautifully crafted, exquisite mechanical movements came back in favour – and they had to be made in Switzerland. They were something rare and very special: high-tech machinery, almost artistic skills and tremendous experience were required to make, assemble and service them. Damn, the wonderfully accurate but mass-produced timepieces: intricate micromechanics are something exclusive and deeply emotional, and only very limited quantities of such timepieces can be produced.” (Trueb, 2005: 11)

This luxury market afforded Rolex the freedom to continue producing high-quality mechanical watches without having to compete against the cheap quartz watches. Suddenly they no longer need to justify their pricing.


Another distinguishing element in the luxury market next to price is supply. From an economic perspective, most brands naturally want to sell as many goods as possible. For a luxury company, however, that can prove fatal. That is because if their good becomes too accessible, it will lose its status good as a luxury signal (Yeoman & McMahon-Beattie, 2018, p.12).

At the same time, their marketing language should become inclusive for the broader public to ensure that people are aware of the brand. This is because people need to recognise the product for it to be aspirational and an indicator of the social hierarchy. (Han et al., 2010, p.27)

Rolex has sold out most, if not all, of their commonly desirable products for the last couple of years (Hagen, 2019). With an annual production of around 1,2 million annual timepieces (Appendix D), even with industry talk of new factories (Cormack, 2023), they will not any time soon build more watches than there will be hunger from the growing levels of wealth in the developing world. This lack of supply raises the demand within the luxury market.

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Appendix D: Rolex Market Share 2022 in Morgan Stanley Report – Source: Müller & Morgan Stanley, Swiss Watch Industry Report 2022

Another tool Rolex uses to factor into exclusivity is pricing. Rolex has proven to have a stoic price approach to its products. The brand famously doesn’t give discounts or change its pricing according to demand. Instead, they choose to constantly and consistently increase prices above monetary inflation. The result is that for the average salary, a Rolex is getting more expensive to purchase every year (Appendix A & B), and ensures that it remains a product for the wealthy.

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Appendix A: Rolex price increase compared to Inflation – Source: Bredan, 2014
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Appendix B: Amount of Rolex watches a yearly income can buy – Source: Bredan, 2014

This factors into their power as a status good as converse to normal thinking a reduction in price in the luxury market reduce the demand for that product (Kuksov & Ying, 2012, p. 621).

Influencer marketing / Promotion Strategies

A historical stronghold of Rolex is their many close collaborations with celebrities, particularly in the field of sports. These have been a key part of their marketing strategy since the inception of the brand. One of their earliest and most successful collaborations was with Mercedes Gleitze. 

As Gleitze planned to swim across the English Channel Rolex approached her and asked her to wear one of her watches during the event recognising the publicity it was bound to attract. (Chambers, 2013, p.13). While Gleitze failed the watch kept on ticking, a feat the brand to this day uses in its marketing.

The idea behind this was that the average citizen could identify themselves with Gleitze through the product. It would become a similarity between them helping them elevate themselves to the status of celebrity (ibid, p.15). After all; if they have the same taste in watches maybe they are more alike than they might think.

Following the success of this advertisement, it continued to be an inspiration for other marketing opportunities. They would give Edmund Hillary a Rolex for his first climb of Mount Everest (Rolex Explorer, 2023). When Pan-Am took to the skies Rolex was the brand to outfit their pilots with their proper watches for the first non-stop flight between New York and Moscow (Rolex GMT-Master II, 2023). This allowed Rolex to perpetually connect itself to key historical events.

Nowadays, Rolex seems to have doubled down on these efforts. They have a carefully selected roster of legends within certain fields. A great example of this is Sir Jackie Stewart.

A key strategy that can be an effective enhancer of the efficacy of advertisement is when it is used in conjunction with product placement (Saini, 2008, p. 83). This connection between advertisement and product placement is most noticeable in the field of sports, a key tenet in the Rolex advertising space.

The sports Rolex focused on are equestrianism, gold, motorsport, tennis and yachting (Rolex and Sports, 2023). These are all sports events with traditionally wealthy participants and viewers. Due to aggressive advertisements as well as, for example, watches for the winner Rolex ensures themselves to be eternally captured in the historical images. A recent example was their promotion for the 100th iteration of the famous 24 hours of Le Mans endurance race. 

Strengths, Weaknesses,  Opportunities, and Threats Analysis

Having now gained an understanding of how Rolex has used marketing tools such as influencer marketing and exclusivity to position themselves within the luxury market we will now do a strengths, weaknesses, opportunities, and threats analysis to gain an understanding of the brand today to follow up on our assessment of the brand of old.

Internal Strengths:

  1. Brand image: Probably the brand’s biggest asset. It is synonymous with luxury and is known to the public yet exclusive. This was carefully built up through extensive advertising, particularly through clever product placement.
  2. Exclusivity: Rolex watches are already exclusive by virtue of their high price. Additionally, their most popular models have year-long wait-lists and are traded above their retail price.
  3. Research and development: Rolex reinvests in its production process. They have invented machines just to test their waterproofness and have state-of-the-art facilities.
  4. Complete vertical integration: Rolex is not reliant on outsiders for their production. They are arguably the most vertically integrated company in the world. Their process starts with them making their metals.
  5. Business to Business: Rolex uses the Authorised dealer system over which they maintain strong control. This allows them to transfer their brand message to customers on a global scale with a uniform character and allows them to focus on production rather than sales
  6. Strong design language: Their watches are immediately recognisable at a distance on the wrist.
  7. Corporate structure: Based in Switzerland as a non-profit foundation held by a private trust, they are not subject to any scrutiny and have a low tax burden.

Internal Weaknesses:

  1. Supply chain issues: Rolex is currently not able to meet the current demand causing a lot of disgruntled potential customers. It is not entirely clear if this is not part of their strategy in regard to exclusivity, a key tenant of luxury.
  2. High prices: This naturally excludes many potential customers, are a requirement though for a luxury brand. To combat this, they use their daughter brand Tudor to sell in the below 5k euro price bracket.
  3. Secrecy: While this is an advantage internally for the brand, the Swiss stoicism creates a lot of frustration for external stakeholders.
  4. No respect for heritage: Hardcore watch enthusiasts feel like the brand caters more to rich uninformed customers rather than hardcore watch enthusiasts. This ignores their wilful decision to move from tool watch to the luxury market and the success that it accompanied.
  5. High production cost: Rolex produces with expensive labour in Switzerland with an intensive production process. It is said that a Rolex takes approximately one year to produce a watch, and while the quality control is stellar, they are arguably highly inefficient. Nevertheless, this is required for the brand image,, and their margins are purportedly high.

External Opportunities:

  1. Rising upper class: Especially in Asia and India, where status is important, they can sell more of their higher margin precious metal models, which historically have performed worse compared to their stainless steel models in Europa and America. This allows for larger margins.
  2. E-Commerce: Rolex has yet to embrace digital markets, which could be a huge market for them, especially if they want to target younger generations. This would not work in their current B2B business model
  3. Diversification: Rolex doesn’t do special editions or limited runs and sticks to its classics. There is an untapped market for personalisation, which is important for younger generations. This goes hand in hand with their strong brand identity, though.
  4. Sustainability: As ESG has become more important, Rolex is naturally poised to use this more in its marketing. The brand uses skilled labour, does everything in-house and is known to be a good employer. Their products last longer than their buyers and can be passed on through generations. This is not yet fully utilised in their marketing.

External Threats:

  1. Scandals: Being a heavily branding-focused enterprise in the luxury market, there is no strict need for their products. This means they are one scandal away from losing their business. Rolex has historically though avoided all kinds of scandals.
  2. Smartwatches: The rise of the smartwatch could be a treat. These have, however remained in the utilitarian tool watch market rather than the luxury market. The first Apple watch sold in gold was a flop, and there have yet to be successful luxury smart watches.
  3. Competition: With Rolex being a trendsetter, they always have multiple brands waiting on their every move, ready to copy them and abuse Rolex production limitations. Additionally, status can also be gained from completely different products like sports cars or fashion.
  4. Counterfeiting: Rolex is among the most copied brand in the world due to its high price point and desirability. These lower-quality fakes reduce exclusivity and dilute the quality of the brand image. There are though studies that contest that this has a negative impact on the brand image (Hieke, 2010, p.167).
  5. Currency fluctuations: As Rolex has a global business, they constantly need to watch their prices are approximately the same on a global scale. This inures menu costs
  6. Global trends: We have seen global growth in luxury brands and also watches. This could change to a point where with a higher divide between rich and poor, a status symbol like a Rolex could become undesirable.

The strengths, weaknesses, opportunities, and threats analysis lays bear a strong and healthy company. Their weaknesses and threats are almost all the flip side of one of their strengths and opportunities or a product of them being a member of the luxury market.

While Rolex does not release numbers themselves, there is a yearly report released by Morgan Stanley that grants some insight. Appendix D shows Rolex has a 29,2 % implied market share. This is more than triple that of their closest competitors, Cartier and Omega. Appendix E demonstrates that this is a continued success, with Rolex winning the ranking in the last five years demonstrating a clear competitive advantage in the luxury watch market.

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Appendix E: Rolex ranking Morgan Stanley Report 2017 to 2022 – Source: Oliver Müller & Morgan Stanley Swiss Watch Industry Report 2017 to 2022

From a macro perspective, we have figures to prove that not only Rolex has recovered but the entire Swiss mechanical watch industry. Appendix H shows that not only has the total value of exports recovered but that after an inflexion point in 1982 in 2001, mechanical watches have regained their dominance over quartz in terms of export value.


When looking at Rolex, we have seen that they had a competitive advantage in the tool watch market due to their reputation for high-quality watches for professionals. That competitive advantage got completely eroded by the arrival of the quartz watch. Suddenly, their unique selling proposition was worthless since the new quartz technology was subjectively superior to their timepieces in every aspect.

Rolex managed to leave the tool watch market in favour of the luxury market, where they are one of the top performers. This was done through clever use of exclusivity and advertisement, both important aspects of the luxury market. In summary, Rolex has avoided the pitfalls of the quartz crisis by adapting its marketing to switch to the luxury market, which allowed them to use their previously gained strengths.

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Chambers, C. (2013). An advertiser’s dream: the construction of the “consumptionist” cinematic persona of Mercedes Gleitze. Alphaville: Journal of Film and Screen  Media, 6.

Corder, R. (2022). Rolex judged the most reputable brand on the planet. Retrieved 1 July, 2023

Cormack, R. (2023). Rolex Is Building 3 New Factories to Keep Up With the                          Unprecedented Demand for Its Watches. Retrieved 1 July, 2023, from

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Lombardi, M.A. (2011). The evolution of time measurement, Part 2: quartz clocks                 [Recalibration]. , 14(5), 41–48. 

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