Rolex Hoping To Overcome Omega Through New Formula One Sponsorship
There is "strong evidence" that Rolex’s recent deal to become F1’s global partner and official timepiece is an attempt to outmaneuver Omega "and halt the erosion of its position as the world’s biggest watch brand," according to Robin Swithinbank of the FINANCIAL TIMES. A report released by Digital Luxury Group revealed that the gap in global interest between Rolex and Omega "has shrunk" from 8.4% in '09 to 2% in '12. Omega’s brand value "was given a significant boost" in '12. DLG’s Founder & CEO David Sadigh said that Rolex’s F1 deal "is a last roll of the dice to prevent Omega from usurping its top position." Sadigh: "Omega is on its way to create a shadow over Rolex in the long run. Major sports event sponsorships, ubiquitous celebrity endorsements and a competitive product offering are some of the key ingredients for the Swatch Group brand to grow further. This could ultimately end up in reaching Rolex’s unmatched popularity three to five years from now." Rolex’s F1 deal "is believed to be worth" $35M a year for 10 years, a figure "unconfirmed by the company, which declines to comment on it." Even for a brand with such heavy financial clout, that "is a considerable outlay." Much of the justification for it "lies in the growth of both the luxury watch industry and interest in F1 in one of the world’s most important economies -- Brazil." Brazil is "the biggest market for F1 fans in the world." Brazil’s importance "is heightened further" because it will host the 2014 World Cup and the 2016 Olympic Games. Omega is a Worldwide Olympic “partner,” and will reprise its role as official timekeeper at the Rio Games, "making Brazil an important battleground for the two brands" (FT, 6/8).