Swatch was originally intended to re-capture entry level market share lost by Swiss manufacturers during the aggressive growth of Japanese companies such as Seiko  in the 1960s and 1970s, and to re-popularize analog watches at a time when digital watches  had achieved wide popularity. The launch of the new Swatch brand in 1983, then led under the auspices of Nicolas G. Hayek, was marked by bold new styling and design.

The first meaning of the name "Swatch" was "Second Watch" because the new watch was introduced with a new concept of watches as casual, fun, and relatively disposable accessories. However Franz Sprecher conceived it as the contraction of Swiss (Made) Watch: "S'Watch", soon became "Swatch" as it is today perceived worldwide.

From the original cult plastic watches, they have now become fashionable objects, generating specialized models (the "Flik-Flak" for children, semi-automatic movements, and even diamond-decorated Swatches). The company also produces watches with seasonal themes.

This combination of marketing and manufacturing expertise restored Switzerland as a major player in the world wristwatch market. Synthetic materials were used for the watchcases as well as a new ultra-sonic welding process and the assembly technology. The number of components was reduced from 91 or more to 51, with no loss of accuracy 

The Swatch Group is the world's largest watch company, and the Group has accelerated its acquisition of Swiss luxury brands in recent years.