Problem from Imports

The Total number of imported watches sold in the country is still insignificant. Of the 2.5 crore unit watch market, as estimated by us the sale of all these brands (sold at over Rs 2,500) ranging from Citizen to Esprit to Swatch, Rado and Omega all put together is not more than 1.25 lakh pieces. Almost insignificant in terms of numbers.

However, in terms of value, we estimate that these would be roughly in the range of Rs 125 crore a year in a market which is estimated at about Rs 1,600 crore a year or 7-8 per cent in terms of value.

But imports are certainly not a threat that they are made out to be. Titan’s volumes in that range have been traditionally small. But in the last 18 months we have been introducing lots of products in that range and we have been growing in this segment. Indian watch market itself would have expanded in that price bracket. This has been happening for the last couple of years. The greater than Rs 2,500 bracket is the highest growth category though it might be small contributor to the total watch market. This is segment is growing because of the interest that has been created by the international brands.

Second, the main plank of the watch market is in the less than Rs 1,000 price category. Effectively about 70 percent of our sales in the watch industry in India is in the latter category. None of these brands has a presence in this category. Only cheap Chinese watches are present in this bracket and they compete with the unorganized manufacturers who are more expensive than them. So, the unorganized sector, is getting hit from the bottom by Chinese products and at the top by the organized sector brands such Maxima and Sonata.

To overcome the threat from imported watches we had decided that in the relatively high end. There is a potential market. Till three years ago, we were the only players in this segment. Now for every segment to develop ours is a wait and watch approach. We know that foreign brands will not find it attractive to compete at the lower price points due to duty structure presence of such embedded brands as HMT and Timex and the grey market. They would most likely come at the middle higher end luxury segments.

The entry of these brands would actually develop the market, at least by inducing consumers to pay higher prices for a watch. We expected them to promote the segment and that has actually happened. We have not invested in this segment in big way but we have just made products available in this range. Today, this strategy is benefiting us to large extent. Though they have got a large volume share compared to what it was three years ago, our market share has not tightened . This is because people have begun to see value in a Titan watch. A similar foreign brand would be priced three four times higher than a Titan. Typically a Calvin Klein would be priced two times of steel collections.

As things stand now, customers are not willing to pay a huge premium for a foreign tag. Finally, the proof is in the numbers. Our market today is growing. Our per watch realization are growing pretty decently. We see customers willing to pay higher prices for our brands. That is happening because foreign watches are very expensive. Titan is a much more easily available product and there are many more showrooms. Finally the presence of a brand is not in the advertisements alone. It should come through the distribution network, the quality of the latter, the number of designs, the kinds of advertising it does, the number of towns it goes into.. in a way we have huge advantage from a consumer’s point of view.

Source: Strategic Management

"I work for an MNC. I faked experience in order to get this job. During
"We are a startup offering contractual employees, who work for XYZ company but on the
We live to work and earn better. Irrespective of the economy, we need our incomes
Training programs are designed with a business need in mind. However in reality, after the
“What? Gaming in the workplace? No way!” This is something that we hear from Corporate