Why does Swatch have a scalping and customer service problem?

The following screenshot is from a consumer group on Facebook with an intorest in the moonswatch series of watchs by Swatch. It is not a one off and perfectly aligns the mood of consumers.

Consumer groups are important for a company to observe for good or for bad. Born out of a common passion or hatred, they are made up of people who are to a degree invested in the company and the product/service they offer. I believe that by observing these groups (they are free and easy to find and many have a large amount of engagement) offer a fascinating insight into the mind of the consumer. We have to remind ourselves that people in these groups have taken time to create, join and engage with others about the brand it is important to consider what they are saying.

For any brand manager or guardian, this is the stuff of nightmares. A passionate brand advocate (third time visiting to get the product, paying a fair amount to get there on this last occasion. On this last occasion we know before the shop opened with one post). Only to be disappointed by what could be described as shocking customer service. These are all taken from one consumer group on Facebook [4], there are others but I decided for simplicities sake to keep to one group.

So why is there a shortage on a non-limited run product? It is very simple, scalping. This has been an issue in many diffrent communities, however this is the first time within the watch space I can find this occuring. I am not including the shortage of Rolex Submariners in this due to it being a luxary product and scarcity being almost a deliberate act. There is no evidence for the Swatch products this is the case.

The only logical explanation is the inclusion of Omega’s brand to try and engage with a new audiance and introduce it into the lexicon of asperational brands for younger consumers. This is a perfectly valid goal and makes perfect sense. However, this has attracted what can be described as a ‘scummy’ crowd, called scalpers. These are indiviguals who deliberatly buy. large quantitys of a product to resell for a horendus markup. They have caused the exposion in price of trainers, the impossible task of obtaining limited run Games Workshop products and the shortage of loo-roll and hand sanitiser during the pandemic. Post 2020, you will have seen or heard about this type of character.

Well, they have tried to enact a one watch policy and ‘silent drops’ to avoid scalpers getting infomation on the restock of products, however this is the wrong responce. It has led to scalpers workign with indiviguel staff members to obain more than one watch [1] and to a more fustration as customers like in the first image can’t obtain the product they want.

Damage control is the name of the game. You don’t want the brand damaged and seen as little more than a scam enabled by either the company or by its staff (which judging by diffrent online watch communities is a growing impression for consumers). You also need to work out a way of thwarting those who are doing the scalping.

Games Workshop is arguable the best at combating scalping in the miniture hobby (its not perfect, but a world better than other companies attempts). They have adapted systems such as queing on the site, logging cookies and obtaining demand from customers, so that when they are in the que they will get a product [2]. They have also worked on other systems such as garunteeing evrey preorder will get one [3]. This is the most interesting and one that Swatch could learn from. It has now been quite a few months since the release into the market of the product. Swatch could experiment with this idea from Games Workshop.

To ensure that products reach the customer, Swatch could using tools such as cookies (if you delete them you loose your product), accounts and other anti spam tools. They then sell the watches online, even if its not made and may take months to reach the consumer online. This in one swoop would kill any scalper demand, removing the incentive of buying to sell at a hellishly high markup and ensuring that genuine customers can order a watch. You may be asking, why? Would’nt this remove the incentive for future purchases? I do not believe this is the case, the larger risk to the company is angry customer, who like the brand and the product being turned off both perminatly. This is something that can be seen to be happening and will continue to occur into the future. It is important for Swatch to get this product to genuine consumers at retail price, because they are the future buyers of other Swatch products and other brands (such as Omega) in the Swatch group.

This may fix the scalping issue, however Swatch will now need to work on getting the consumer back into their stores when consumers (passionate ones as well) have had negative or multiple negative interactions with retail staff. This issue is not restricted to Swatch stores, although they are gaining a reputation online for this.

With the additional benefits that Swatch would be able to plan production, and gaining data on areas of natural high demand ect.

Swatch needs to act more to control its image issue brewing around the moonswatch line of products. If not it will lead to consumer dissatisfaction, reflected in other areas of the business, the prime example being in its retail environment.

Customer service is the easiest thing to control and maintain in this situation, providing the opportunity to fix problems and get customers back on track with the brand and offering potential alternates in the meantime. Yet this seems to be an area of failure. This can be the quick piece of change needed while anti-scalping measures are ramped up by the company.

It will be interesting in the future as more companies struggle with scalpers and the issues they bring, in addition to the manner they try to keep customers happy.

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