Swatch is responding to the advent of the wearable technology industry with a new product of its own named the Swatch Touch.
The biggest watchmaker in the world is seeing the rise of smartwatches not as a threat but as a new opportunity for the company, with the smartwatch market's worth potentially reaching up to $93 billion.
Smartwatches are a part of the wearable gadgets trend that has devices connecting with user's smartphones for shared functionalities such as checking emails, making calls and monitoring health-related data. The devices are seen as the next big thing in the tech industry and potential threats to the traditional wristwatches that Swatch is known for.
Swatch's response to the smartwatch trend is that it will be launching watches with so-called "smart" features, starting with the unveiling of the Swatch Touch in summer of next year.
According to Nick Hayek, the CEO of Swatch, the new watches that the company will be releasing will provide the user with a counter for steps taken and calories burned. The watches will also be featuring several new features that will utilize Bluetooth technology.
"All the big technology firms want to work with us and I don't rule out that we are or could be collaborating in some areas. But we can also do many things on our own," Hayek said in an interview at Swatch's headquarters in Biel.
Swatch's announcement comes about a week before Apple's planned Sept. 9 event, when it is rumored that the company will be unveiling the iPhone 6 and Apple's first entry into the smartwatch market.
A report stated that the iWatch may have a price tag of $400, with the smartwatch coming with a touchscreen, Bluetooth transceivers, a GPS receiver and an accelerometer.
Apple's iWatch is partly the reason why the prices of shares of Swatch this year have decreased by almost 15 percent.
"For Swatch, this could mean a 2 percent hit to revenue and earnings before interest and tax for each 10 percent share that the iWatch was able to gain in its addressable market," said Bernstein analyst Mario Ortelli in July.
Collaboration between Swatch and Apple are seen by many analysts as a great business partnership for a smartwatch, but Swatch has never expressed immense interest in such a team up. This is because the company believes that it should stick with what it has been known for.
"Our first message for customers is the watch. If they like it, they might also be interested in the extra functions," said Hayek. "It is a problem if you only define a product by its technology. Technology alone doesn't sell, not in watches."
