A recent ad by Swatch sparked widespread backlash in China after being deemed racist, with many online users calling for a boycott of the Swiss watch maker.
The ad in question featured a model pulling back the corners of his eyes, which critics have said evokes a racist “slanted eye” gesture. Although the retailer eventually withdrew the ad and issued a statement of apology, shares of the Swatch Group dropped up to 4%, deepening problems for the company within the region.
The question is: Why did it do it? Some experts say it was no mistake.
“I am surprised that Swatch did not have other types of references, and most importantly, did any pre-testing before launching this ad, because it would have been very easy for them to find that there were some cultural values that were disrespected in the way they were depicting the information,” Ana Valenzuela, professor of marketing in the department of marketing and international business at Baruch College, told Retail Brew.
Wendy Zajack, faculty director and associate professor at Georgetown University’s McDonough School of Business, went a step further, saying that the primary goal of the ad was “getting attention,” which is in line with what many brands have been doing recently.
“Brands are trying to spark conversations and are trying to stand out with things that are going to draw attention and have conversation about,” she said. “It was an attention-seeking ad, knowing that there would be controversy around it.”
Scott Markman, founder and president of branding agency MonogramGroup, who has nearly a decade of marketing experience in China, agreed, adding that it was “no accident.”
“These are the sharpest marketers on the planet,” he said. “I mean, design and positioning and imagery and this over decades, right? What were they thinking?…This had to be green-lit by a lot of people.”
While fashion brands are certainly no strangers to controversies, especially when it pertains to culturally offensive or insensitive topics, Markman said some marketers have come to believe that no publicity is bad publicity.
The essential idea behind these campaigns is to “stir the pot” a bit, he said, in a way where “if it’s 35% bad, there’s gonna be 65% beneficial in some way, shape, or form.”
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“They’re willing to take these risks because they look around and see other brands that they think are peers doing the same stuff,” he added, citing the recent American Eagle ad featuring Sydney Sweeney. “They’re willing to take that hit. Because these brands are global, they take cues from each other and read the tea leaves on the global stage, and they’re probably being pressured a little bit to make noise.”
Swatch, in this case, has no doubt been successful in creating substantial “noise,” but with its stocks hit hard in the immediate aftermath, it’s unclear whether this controversy will backfire for the brand in the long term, alienating it from a crucial global consumer market.
Zajack said while historically consumers have a tendency to forgive and forget in time, there is a sense of unpredictability in this instance as consumers and how they “relate to a brand” are changing.
“You can’t just assume everyone’s going to forget about it and get over it,” she said.
It’s also important to note that Gen Z and younger shoppers make up a significant chunk of Swatch’s consumer base—a generation that famously shops with its values in mind.
Markman, however, argued that while consumers in China might keep their distance from Swatch for a while, when the “dust settles,” Swatch will still be there simply because of its accessible price point.
“The genius of Swatch is that they invented a category a long time ago, and they continued to pump out product and marketing and retail presence that fuels that outlandish but highly sophisticated design, a broad range of stuff,” he said. “We all recognize Swatch watches, so you don’t have to try very hard to make a statement just by something you’re wearing on your wrist.”
Only time will tell (get it?) how things unfold for Swatch, but Zajack said she believes that regardless of whether the company’s image recovers or not, “it’s going to be in the brand failure catalog for quite some time. You’re going to keep coming up in this way, and is that the association you want your brand to be building? Personally, I don’t think so.”