Swiss Army Brands, Inc.

views updated

Swiss Army Brands, Inc.

1 Research Dr.
Shelton, Connecticut 06484
USA
Telephone: (203) 929-6391
Fax: (203) 929-3786
Web site: www.swissarmy.com

SWISS ARMY EQUIPPED CAMPAIGN

OVERVIEW

The "Swiss Army Equipped" campaign, created by Mullen Advertising for Swiss Army Brands, Inc., established a single brand image that unified advertisements for an assortment of merchandise. The company marketed watches, sunglasses, pens, and other items, but its best-known product was the Original Swiss Army Knife, a multiblade pocketknife that included implements such as a fish scaler, a nail file, a wood saw, a screwdriver, a bottle opener, a wire stripper, and a corkscrew. One advertisement for the Original Swiss Army Knife pointed out the product's many uses with the headline "The Swiss never begin sentences with 'If only I had a …'" The "Swiss Army Equipped" campaign used the popularity of Swiss Army knives to promote other products. In addition, its military tone and references to Switzerland called attention to the company's name and stressed the idea that the products were built to precision standards, suitable for use by the Swiss Army. The "Swiss Army Equipped" campaign was launched in print media in April 1998 and continued running into 1999.

HISTORICAL CONTEXT

Swiss Army Brands began as a firm that sold butcher scales in New Britain, Connecticut. When the company's founder, Charles Forschner, died in 1877, his son Richard moved the business to New York City and named it R.H. Forschner. During the 1920s the company imported high-quality cutlery from Germany, but supply problems in the years shortly before the outbreak of World War II prompted Forschner to begin buying cutlery and what was later called the Victorinox Original Swiss Army Knife from a Swiss company named Victorinox. During World War II thousands of American soldiers were stationed in Europe, where they observed that the Swiss Army was equipped with multipurpose pocketknives that the Americans called Swiss Army knives. After World War II there was great demand for Swiss Army knives in the United States, and R.H. Forschner marketed the product through hunting and camping stores and a few specialty retailers. The Forschner family sold the business in 1957, and it changed hands again in 1974. At that point pocketknives accounted for $800,000 (about 20 percent) of the company's annual sales of nearly $4 million.

The new owner, Louis Marx, Jr., began marketing Swiss Army knives through Wal-Mart, Target, and other mass merchandise outlets. In 1983 the company moved back to Connecticut and was renamed the Forschner Group, Inc. In 1989 it introduced the Swiss Army Brand Watch. By 1994 the firm's watches were selling for $75 to $500 each for a total of about $30 million a year, but pocketknives accounted for half of the company's annual sales of $125 million. In 1996 the firm changed its name to Swiss Army Brands, Inc., and began marketing Swiss Army brand sunglasses and writing instruments imported from Switzerland. It also marketed Victorinox Watches, Swiss Air Force Watches, and R.H. Forschner cutlery for commercial food operations. Late in 1997 the company introduced Victorinox multi-tools, which resembled Swiss Army knives but were built around a primary implement such as pliers or scissors instead of a knife blade. Unlike competing brands, the Victorinox SwissTool, was designed with individual springs to move each implement, locking devices to hold the implements securely as customers used them, and housing for the implements on the outside of the handle so the consumer did not need to open the entire unit to use one part.

As the company expanded its product line, its image became less clearly defined. Some advertisements used the popularity of Swiss Army knives to promote other merchandise, but the campaigns were not unified, and at times they used three different logos. The company was designing some of its own advertisements and hiring various agencies to develop campaigns for specific products. In the fall of 1997 Mullen Advertising was hired to create a strong, sharp brand image that would harmonize all the company's marketing efforts.

TARGET MARKET

Swiss Army Brands referred to itself as the company that could equip people for life's adventures, and it described its target market as "people with a live-on-the-edge attitude at work and play" and "people who define themselves by their avocation, are passionate about what they do, and love strong brands." Its products were used by sports enthusiasts who participated in hiking, snowboarding, golf, and other outdoor adventures. The multipurpose knives were popular among backpackers and travelers who wanted equipment that took up little space but could be used for everything from opening cans to sawing small pieces of wood. Workers in specific trades, such as plumbers and electricians, also used the company's tools and other multipurpose products. The firm's merchandise was sold at outdoor, sport specialty, and hunting outlets, in addition to some department stores.

The firm's rugged military image tended to appeal more to men than to women. The Swiss Army name carried a certain mystique, and the company's products were noted for being durable and functional. Corporations frequently had their names and logos imprinted on Swiss Army knives to be distributed as promotional gifts. (This was a particularly common practice among pharmaceutical sales representatives, who gave the knives to doctors as they discussed the latest information regarding prescription drugs.) In general, the company's customers liked to view themselves as people who could cope with any situation. With tongue-in-cheek humor the "Swiss Army Equipped" campaign acknowledged that consumers tended to fantasize that they could depend on the products to survive a dangerous adventure, but in fact the items would often be put to more mundane use such as tightening the screws in a pair of eyeglasses, removing the cork from a bottle of wine, or slicing cheese.

TRADEMARK DISPUTE

The term "Swiss Army knife" was not trademarked in the United States and was not clearly defined. To further complicate matters, in the early 1900s the Swiss Armed Forces had split the contract for its military knives between a Swiss company named Victorinox (which eventually called its product the Victorinox Original Swiss Army Knife) and a French company named Wenger (which called its product the Genuine Swiss Army Knife). The rival firms operated under a gentleman's agreement regarding the use of the name until 1992, when Arrow Trading Company began marketing an inferior Swiss Army knife that looked almost the same as theirs but was made in China. Swiss Army Brands, the U.S. marketer of Victorinox products, sued Arrow, but the court ruled that "Swiss Army knife" was a generic term that could be used by anyone. The Swiss Federal Defense Department registered a trademark containing the words "Swiss Army" and in 1996 granted Swiss Army Brands the right to its use outside the United States and its territories, Canada, and the Caribbean. The company continued to press for exclusive rights to the term "Swiss Army" in U.S. courts during 1996 and 1997.

COMPETITION

Original Swiss Army Knives controlled about 75 percent of their category, but the company's other products faced strong competition. In the $300 million market for multi-tools—a relatively new segment that had great potential for sales to industrial customers—Leatherman Company was a major contender. Leatherman had begun making innovative multi-tools in 1983, long before Swiss Army Brands entered the category. Another primary rival, Wenger, was based in Switzerland, but its products were marketed in the United States through a New York company named Precise International. In 1998 Wenger announced that it would spend $40 million over a five-year period to develop a global brand image and marketing strategy for its Genuine Swiss Army Knives and Wenger Swiss Military Watches.

Some advertisements for watches focused on their rugged construction. A campaign from the Magellan Group, Inc., featured the headline "The watch issued to U.S. troops during Desert Storm." The text cited the durability and functional features of the products, particularly their luminous dials, which glowed in the dark because they contained phosphorous. The "Irony" campaign for watches made by Swatch Group showed timepieces being lifted out of liquid mercury. Advertisements for Timex Corporation's Ironman watches maintained that they could withstand extreme conditions. Bulova Corporation emphasized the fine Swiss craftsmanship of its Accutron Swiss watches by superimposing a close-up photograph of two timepieces over a panoramic view of majestic mountains and cabins covered in deep snow.

Other campaigns revolved around the use of watches in sporting events and outdoor adventures. The Timex Expedition was advertised with the slogan, "The watch you wear out there," below vivid color photographs of average people exploring in wide open spaces. Each ad showed a selection of watches strapped to items such as canoe handles and large rocks. A black-and-white magazine ad for Timex's stainless steel watches included a snapshot of five smiling young people on a boat above a selection of five watches and the headline "So much about a family is revealed in its faces." In 1998 TAG Heuer International SA ran a $10 million print campaign called "Inner Strength," which showed the company's watches beside portraits of famous athletes such as tennis star Boris Becker. Each included a quote that revealed the celebrity's attitude about winning. "I drew my strength from fear. Fear of losing. I don't remember the games I won, only the ones I lost," said the quote from Becker. A National Geographic ad for watches made by the Swiss company Montres Rolex SA featured a photograph of a diver above the headline "Deep beneath the ocean, Dr. Sylvia Earle's Rolex is an indispensable piece of oceanographic equipment. Back on dry land, it's an indispensable piece of jewelry." The text explained that the watch was an "officially certified Swiss chronometer" used to time each dive, crafted for precision performance but also nice looking.

In the market for sunglasses Swiss Army competed with established brands such as Ray-Ban, made by Luxottica Group S.p.A. Oakley, Inc., marketed a wide assortment of high-tech sunglasses and goggles that were popular among tennis players, skiers, basketball players, and other sports enthusiasts. AAi. FosterGrant ran an advertising campaign that showed celebrities wearing sunglasses above the headline "Who's that behind those FosterGrants?" The text in one magazine advertisement answered, "Someone who wants a wide range of styles for a diverse, active lifestyle. Someone who's as smart about how much they spend as how they look."

MARKETING STRATEGY

Mullen Advertising created the "Swiss Army Equipped" campaign to define an identity for Swiss Army Brands and to promote the company's various product lines, including its pocketknives, multi-tools, watches, sunglasses, and writing instruments. The advertising budget for Swiss Army Brands was estimated at $10.0 million in 1998, up from $4.9 million in 1997, according to Adweek. Replacing the three insignias that Swiss Army Brands had used previously, Mullen created a new logo with a white cross on a red background, a design that resembled the silver cross on the red handles of Original Swiss Army Knives. Advertisements in the "Swiss Army Equipped" campaign featured a dark red background that contrasted with the white cross in the new logo. The campaign emphasized the company's long, reputable history of marketing Original Swiss Army Knives and other merchandise imported from Switzerland, a country known for its fine workmanship. The ads had a military look, with the company logo and tag line in separate compartments.

The campaign used sly humor to point out that Swiss Army Brands products could be invaluable during grand adventures but could also be applied to less dramatic, everyday problems. One magazine advertisement showed light glowing inside a ski hut at night. The headline read, "A Swiss patrol is prepared to overcome any situation. A fallen bridge, a crushing avalanche, a stubborn cork." The text added that Swiss Army products were useful "whether you need to battle a perilous blizzard or a tightly sealed bottle of vintage Pinot Noir." An ad for watches suggested, "The luminous hands and hour markers are ideal for timing midnight maneuvers during a blizzard in perilous terrain. Handy at the movies too." Another advertisement said, "Tightening a screw. Slicing a well-aged cheese to accompany wine. In Switzerland, it's natural to be equipped for the task at hand. And if someone here is found to be lacking the right tool, it only means he's a tourist."

The ads ran in magazines for outdoor enthusiasts and general consumers, including Outside, Backpacker, Conde Nast Sports for Women, Vogue, Rolling Stone, and Men's Journal. The company designed its Internet site around the "Swiss Army Equipped" theme and sponsored sporting events such as the U.S. Open Snowboarding Championship, the Crested Butte Extreme Skiing Championship, and the Franklin Templeton Tennis Classic. Swiss Army products were placed conspicuously throughout Armageddon, a blockbuster science fiction film released in the summer of 1998. Actor Bruce Willis and other stars in the motion picture wore space suits with built-in Swiss Army sunglasses, and the Swiss Army logo was displayed on helmets and lunar-landing vehicles used in the production. Swiss Army Brands advertised extensively and sponsored consumer contests to publicize its connection to the film. In 1998 the "Swiss Army Equipped" campaign supported the launch of two new products: the SwissTool, a multipurpose item that featured an assortment of blades and instruments, and the SwissCard, a slim variation of the Swiss Army knife that could fit inside a purse. Swiss Army Brands also became the worldwide licensee for St. John Timepieces, a product line with prices ranging from $50 to $18,000, which targeted sophisticated women.

OUTCOME

In September 1998 the "Swiss Army Equipped" campaign won 24 awards, including best of show honors, at the thirty-eighth annual Francis W. Hatch Awards, sponsored by the Ad Club of Greater Boston. In May 1999 at One Show, a gathering to recognize excellence in advertising, Mullen won a print advertising award for the "Swiss Army Equipped" campaign. To publicize its many products, Swiss Army Brands dispatched two promotional trailers on a mobile marketing odyssey, the Equipped Tour, which crisscrossed the United States and sent back reports that were posted on the company's Internet site. Each trailer was outfitted with a giant Victorinox Original Swiss Army Knife on its roof. The promotion included the inauguration of the Swiss Army Equipped Awards, a national program that recognized the achievements of people who exhibited the resolve and leadership to complete difficult tasks.

Field and Stream magazine nominated the new SwissTool as the "best of the best" multi-tool on the market. In April 1999 Swiss Army Brands acquired the assets of Bear MGC Cutlery, Inc., an Alabama company that made knives and multi-tools. New Swiss Army Brands multi-tools introduced that year were designed for consumers with specific interests. The board sport tool featured components that could be used to adjust snowboards, skateboards, and in-line skates. The business tool featured a flashlight and a travel alarm clock. The auto tool included a tire gauge and an ice scraper. New sunglasses that the company introduced in 1999 had names such as Hurricane, Squall, Windstorm, and Tornado.

Swiss Army Brands had net sales of $127.0 million and profits of $1.5 million in 1998, compared to sales of $119 million and a loss of $4 million in 1997. The company attributed the growth primarily to sales of its new products. By December 1998 the Swiss Army brand of watches, sunglasses, and writing instruments accounted for about 50 percent of the company's sales. Revenues from the Victorinox brand, including Swiss Army knives and multi-tools, amounted to about 35 percent of sales, and R.H. Forschner commercial cutlery items amounted to about 15 percent.