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Case V

Titan Watches—A Case on

Channel Management
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Titan Industries is a good example of a company succeeding in marketing by adopting multi-mode retailing,
consisting of exclusive showrooms – owned as well as franchised, semi-exclusive outlets, multi-brand
outlets, institutional buyers, and special rural outlets. Recently it has also started on-line stores to cater to
the tech-savvy younger generation. Why Titan went in for such a wide spectrum of retailing modes, and
how it achieved its marketing objectives through this route, is the theme of this case study.

Introduction
Titan Industries Limited, formerly Titan Watches, is a joint venture of the Tata Group and the Tamil Nadu
Industrial Development Corporation (TIDCO). It was promoted in 1984. In 1987 the company set up its
production facilities for the manufacture of quartz analogue electronic watches at Hosur, near Bangalore.
Today Titan’s annual business is in the range of Rs 3,000 crore, with watches accounting for Rs 1,200 crore.

Objective – Fast Growth and Market Leadership

From day one, Titan was aggressive and ambitious, and was seeking rapid growth. It was actually seeking
leadership in the industry and was seeking it in quick time. Within three years of launch, it did emerge as
the leader in the quartz segment – the fastest growing segment of the industry. Titan sold 7,50,000 quartz
watches in the very first year and crossed the 3-million mark by the fourth year, securing a 60 per cent
share of the quartz segment. Titan maintains this leadership.
By 2001, Titan was making and marketing over 6 million watches, thus becoming the sixth largest
global player in the ‘manufacturer brands’ category, i.e. watch companies which, by themselves
manufacture the components that go into the branded products they market. Presently, the company
manufactures around 11 million watches per annum. The company’s watches are currently sold in about
40 countries of the world, through marketing subsidiaries based in London, Dubai and Singapore. Titan
also makes watches for other international labels.
Such a fast growth and dominance in the market could be secured only through very dynamic marketing.
In fact from the very beginning Titan knew that to secure such a leadership position in a short span of
time, it had to be innovative in every aspect of marketing.

Titan’s Marketing Strategy

Let us first take a look at the overall marketing strategy of Titan. This will serve as the background to
Titan’s channel strategy and provide the right perspective for this case.
When Titan entered the market, HMT was the unquestioned leader in the industry. In fact, the name
HMT had almost become synonymous with wristwatches. Titan had to reckon this reality while formulating
its marketing strategy. Titan consciously voted for a confrontation strategy. It confronted the leader,
HMT, head on and soon acquired the leadership position in the quartz segment of the watch industry.
Titan’s marketing strategy had three main components:
1. An aggressive product strategy. High-quality product, supported by state-of-the-art technology
and a long product line, with a wide range of models.
2. An effective positioning strategy.
3. An innovative channel strategy, dominated by the showroom concept.
These were accompanied by matching pricing and promotion strategies.
This case deals with the channel strategy. But before we take it up, we shall briefly touch upon the
other two components, which will help appreciate the role played by the channels better.

Aggressive Product Strategy

Titan opts for quartz
When Titan entered the watch business, mechanical watches dominated the market. HMT, the market
leader, was producing mechanical watches in the order of five million pieces per year. Titan had to make
a conscious choice – Should it go for mechanical watches? Or should it follow the global trend and go for
quartz? Or should it go for a combination of mechanical and quartz watches?
Initially, Titan considered the option of making both mechanical and quartz watches. But, on closer
examination, it decided to stick exclusively to quartz. This proved to be a sensible move. The world over,
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the trend has been towards quartz. Moreover, setting up a mechanical watch plant required more investment.
The quartz route, would enable Titan to enter the industry with lesser investment; a quartz watch normally
has less than half the parts of a mechanical watch. Titan was aware that the decision to go for quartz
would deny Titan the market of mechanical watches, the high volume, lower-end segment. Titan
consciously opted for quartz.

Product, the No. 1 weapon

To confront the leader, Titan chose its product as the No. 1 weapon. Titan targeted the top and middle
ends of the watch market and launched a wide and attractive range of watches. They were modern and
stylish. Titan launched a number of new watch movements including dual time, world time, alarm and
long-battery-life watches. In short, Titan offered a product that combined quality and fashion; it provided
an abundant choice in terms of styles and models. Titan kept adding new models and dials at regular
intervals. The initial range included gold and jewellery watches, like:
Classique Distinctive watches combining the elegance of gold and leather, in 135 different designs.
Royale Stylish dress watches in all gold and precious metals, in 40 different designs.
Aurum Jewellery watches in 18 carat gold, studded with precious gems and coloured stones.
In course of time, Titan’s range carried over 1,000 designs, in various price points.

Effective Positioning Strategy

Titan positions the generic device – watch – as a fashion accessory
and an ornament
All along, the watch was considered a mere time telling utility item and in tune with this perception, it had
acquired a clone image. While people gave attention to dress, ornaments and even footwear, nobody
bothered much about the wristwatch. You needed one, that’s all. This is evident from the leader HMT’s
positioning, as ‘The timekeepers of the nation.’ It added, ‘If you have the inclination we have the time.’
This is how HMT promoted its watch. It was selling just a timekeeping device.
Titan positioned the watch, as a fashion accessory and an ornament, an item one would like to possess
and display. It also incidentally showed ‘time’. Titan’s positioning was to change the consumer’s very
perception about watch. Titan wanted its watch to be seen as an expression of an individual’s taste and
style than as a mere timekeeping device. Such a positioning was in perfect sync with the stylish watches
Titan was rolling out.

Titan Modifies Product and Positioning Strategies

Titan’s premium offers and the high-end positioning could take its business only upto a particular level.
With this exclusive positioning, growth was saturating. And, new competition emerging from global
brands was hitting at Titan’s premium pricing strategy. Titan found that if it had to grow, it had to become
the obvious choice to different segments of buyers.

Titan decides to expand its market; enters the low-price segment

By now, Titan had established its leadership in the middle and up-market segments with watches in the range
of Rs 500 to 1 lakh. Titan, now decided to enter the low price segment to enlarge its business. Titan saw a
huge potential in the Rs 300 to Rs 500 segment, which was virtually untapped by Indian manufacturers. This
lower-segment, accounting for nearly 50 per cent of the 20-million-unit watch market, was served mainly by
grey market operators. Titan found that if it could provide watches priced between Rs 350 to 500, it would
complement the Titan range and confer a dominant position on Titan as a player in all segments of the watch
industry. Titan worked out a tie-up with Timex Corporation of the US, the world’s fourth largest watch-
making company, and promoted Timex Watches Ltd. To start with, Timex offered around 200 models in four
distinct ranges. The plan was to release 800 models over a period of five years. Though the Timex alliance
was in operation only for a few years, it marked Titan’s entry into the mass market.

Titan attacks HMT in the low-price segment

By offering a lower priced quartz model, Titan could confront HMT even in the lower end of the market.
And together with Timex, Titan achieved a market share of 75 per cent of total quartz watches in India.
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The entry into the mass-market made its unique demands on the channel strategy of Titan. In addition to
the marketing infrastructure of Timex that came into Titan’s fold, Titan used other channel options to
strengthen its reach in the sub-town markets.
Several other segments Now Titan started cultivating more segments like the modern youth, urban
children and rural buyers. It designed special offers for them.
15 years from launch, Titan became an omnipresent national watch brand
At the end of a 15-year period, Titan stood as an omnipresent national watch brand, meeting varying
demands in quality, fashion and price. Titan progressively went in for deep segmentation of the market
and made distinct offers for each segment. We have explained this in the chapter on Market Segmentation
and Targeting.
New models like Xylys, Edge, Heritage, Wall Street, Regalia, Bandhan and Aviator added further
variety to the product range. In addition, the company also started marketing models from Tommy Hilfiger
and Hugo Boss under licensing arrangements.
In 2008, Titan received Marico Innovation Foundation’s Innovation for India award for its Edge
model; Edge is the slimmest water resistant watch in the world.
Exhibit 18.3 in the chapter on Market Segmentation and Market Targeting sums up the wide range
of product offerings from Titan and their positioning. Such a growth strategy revolving around
changes in product/positioning had to be supported by a matching distribution set up. In fact, Titan was
creating new market segments and offering unique products. The channel strategy had to evolve in tandem.
The question was: how will these widely varying offers, addressed at diverse market segments reach
them?

Innovative Channel Strategy

Matching with its product positioning, Titan adopted an innovative distribution strategy. Titan was not
content with marketing its watches as mere time-telling devices. It wanted to enlarge the meaning of
watches and sell them as symbols of status and fashion, and as jewellery. Its channel strategy had to
match these product and positioning strategies. Having decided to sell its watches as items of status and
fashion, and as jewellery, Titan just could not stay with ordinary watch retail shops. It needed class
outlets; at the same time it also required vast reach and extensive penetration in view of the large volume
of business it was seeking and the multitude of segments it was tackling.
Before entering the market Titan had made a quick study of the 8,000 odd retail watch outlets of the
country. The majority of the existing outlets were perceived by the consumers as just stores, not as
showrooms of watches. Titan opted for the showroom idea and started franchising a network of trendy
Titan Showrooms.

Channel Strategy Flows from Channel Objectives

In Chapter 27, we saw that channel strategy emanates from channel objectives. This has been quite true
in the case of Titan. Titan’s channel objectives have been:
• Use the channel, (along with product and promotion) for changing the very perception of buyers
regarding watches and sell them, not as mere time-telling devices, but as items of status and fashion,
and as jewellery.
• Be close to the customer, so that he can see the product on offer and be tempted.
• Expand the overall demand for watches through extensive penetration and reach of the chosen
segment.
Titan’s channel strategy flowed from its channel objectives. Titan had to provide:
• Classy stores (stores with superior design and superior image)
• Superior merchandising
• Full product range display
• Good customer service
• Locational convenience
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Chart I Owned and Franchised Showrooms: Commonalities

• Both are retail outlets. • There is no difference in store image.

• Both sell Titan products exclusively. • In respect of both, the entire package – from store design, to
• Both have the same standard interior design. merchandising, to display, to recruitment of staff – is
• Both have the same standard systems. coordinated by Titan.

Chart II The Rationale Behind the Two Types of Showrooms

Rationale behind own showrooms Rationale behind franchised showrooms

They will provide demonstration effect and induce strong prospects
to apply for the Titan franchise.
They will also serve as models for the franchisees.
They could be controlled better and hence used better for enhancing
company’s image.
They will help the company to be in direct touch with the customers
(in locations, where such company showrooms are run). Getting
feedback directly from customers is certainly the best way of being
close to the market.
They will provide the company the opportunity to invest in prime
property in the big cities.
The company, after all, could set apart only limited funds for the
distribution job. So, it could have only a limited number of its own
showrooms. Only with franchisee showrooms, an effective coverage
of the market could be achieved.
Franchisees could do the job more economically; they incurred lower
overheads compared to the company.
Procuring showroom space for its own showrooms at the desired
locations was not easy; franchisees bring in such space; many of
them owned excellent showroom space in prime locations.
Set-up time could be saved through the franchising route and the
company would be in a position to establish the desired network faster.

Titan Votes for a Network of Showrooms

In view of the above requirements, Titan voted for the showroom idea and built up a network of trendy
Titan Showrooms. Titan had its own rationale for rejecting the existing channel pattern in its industry. To
quote Titan, ‘We felt the need for such exclusive showrooms, where we have control on the decor, the
ambience, the selection of staff and the level of inventories, as we wanted to upgrade the quality of
display of our wares and also to expand the market for watches.’ It was Titan’s conviction that if the
watch is positioned as a fashion wear, the store image was very important and had to be in tune with the
overall product positioning. The showrooms are essentially retail outlets, but they have higher standards
in interior design, decor and systems; and they exclusively sell Titan products. Titan, in fact, became a
pioneer in trying out the showroom concept in the product category – watches.
Initially, Titan set up a couple of showrooms of its own. Titan, however, appreciated that it could not
achieve wide market coverage by wholly depending on such showrooms. It, therefore, went in for a mix
of own showrooms and franchisee showrooms, the latter, eventually, far outnumbering the former. The
significant point is that the showroom idea, as such, formed the cornerstone of Titan’s channel strategy.
Titan showrooms now dominate the upper-end of watch retailing in India and account for over one-third
of Titan’s total domestic sales revenue.
Control over store image, one main consideration Given its channel objectives and channel strategy,
Titan had to have complete control in the matter of store image. With a network of showrooms, Titan
could secure such control. Titan was attempting to change the very experience of buying a watch.
Owned as well as franchised showrooms
As already mentioned, Titan went in for its own showrooms as well as franchised ones. By 1996, i.e.
within eight years of starting production, Titan had a chain of nearly 100 showrooms. The number of its
own showrooms was limited; a large majority were franchised ones. For example, out of a total of 83
Titan showrooms operating all over India, in 1995, five were company owned (in the cities of Bangalore,
Kolkata, Bhopal, Chennai and Mumbai) and the rest were franchised ones. The two kinds of showrooms,
no doubt, have a lot of commonalities, which are shown in Chart I. After some time, Titan started
calling the network of its showrooms – World of Titan.
Chart II explains the rationale behind Titan opting for own showrooms as well as franchised
showrooms.
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Exhibit A Criteria for Franchisee Showroom

Shop Space: 500–1500 sq ft (a) The showroom shall be designed as per Titan’s specifications,
Frontage: 20 ft wide maintained in the best way, and operated effectively, in tune
Building: RCC, first class construction with the reputation of the company/brand.
(b) The franchisee shall be responsible for upkeep, furnishing,
Neighbourhood: Fashionable outlets; away from traditional watch
equipment, etc. No modification of design shall be done without
outlets
the permission of the company.
Area: High traffic retail market area and upcoming localities
(c) The showroom building shall be insured and all risks shall be
Investment: For the business, Rs 20–50 lakh; for interiors, Rs borne by the franchisee.
1,000–2,000 per sq ft (d) Depending on the investment made, there shall be a specific
Other Aspects: package of terms for each franchisee.
Franchisee’s track record (e) The company has the right to have one or more additional
Reputation franchisees in the same city.
Receptiveness (f) The company is free to supply its products to anyone else it
desires in the given town.
Titan also specified that
(g) The agreement shall be valid for a period of 10 years

Selection of franchisee showroom

Titan went about the task of selecting the franchisees/showrooms in a systematic manner. It released
elaborate advertisements in the national and regional press, inviting applications from prospective dealers
and giving a resume of Titan’s activities, its marketing strategy and the plans of the company for appointing
franchisees/showrooms all over the country. Titan also briefly outlined the benefits the franchisees would
get and the inputs required from them. The high standards of merchandising, display, sale and service
expected of the franchisees were specifically mentioned:
‘The applicant should possess a showroom of approximately 50 sq m; in a high consumer traffic
area; should have excellent salesmanship; should be willing to invest in interiors as per the company’s
advice; and should be able to maintain high standards in merchandising, displaying, selling and servicing
watches.’
Titan also took care to communicate the point that the watches are products of the House of Tata. The
ads communicated, ‘Tata presents a promising business opportunity through the Titan franchise.’
Since the Titan watch was positioned as a symbol of fashion, status and contemporariness, rather than
a utility, Titan insisted on ‘attractive showroom in the best location’ as a major criterion in dealer selection.
The ads carried a picture of the Titan showroom that was already functioning in Bangalore, attractively
displaying more than 150 international designs of watches. Titan wanted the franchisees to perceive the
Titan business as one dealing in ornaments, rather than watches. As a result of this focus, Titan was able
to find the right kind of franchisees within a short period. Three years later, when Titan went in for
another round of selection of franchisees, it organised an equally systematic selection. This time, it
employed the pithy slogan in its ads:
Titan
is
Shopping
for
Showrooms.
The details of the criteria that Titan used while selecting showroom franchisees, are shown in
Exhibit A.

Votes for Multi-Mode Retailing, Keeping

Showrooms as the Main Mode
Titan could not stop its retailing with showrooms, owned and franchised. It had to embrace other channels
as well. In fact, it had to go in for multi-mode retailing to achieve its objectives.
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Chart III Rationale Behind Titan Shops

• It was not possible for Titan to effectively cover the market
through showrooms alone, own or franchised. It had to
embrace the traditional watch shops too for attaining the large
business it had targeted.
• But these shops could not form part of Titan’s exclusive
showroom network for two reasons: Either these shops were
unwilling to be exclusive to Titan or Titan did not find them
suitable to be elevated to the exclusive showroom category.
• Earlier, Titan had adopted a policy that only those without prior
experience in watch retailing could become a Titan showroom
franchisee. Titan had stipulated this condition of no prior
experience because it wanted to have a high degree of control
over the franchisees and mould them according to its plan;
this would be easier with newcomers, not those already in the
line.
• Now Titan had to rope in men with experience in the watch trade.

The Second Mode – The Titan Shop/Time Zone

Titan went in for a second category of retail outlets – the Titan Shops. It set up a network of over 100 such
shops, spread all over the country. These were also showrooms, but they were not exclusive to Titan.
They were semi-exclusive in character. The stipulation is that they should stock and deal Titan products
as their mainstay; at least 70 per cent of what was sold should be Titan products while the remaining 30
per cent could be other brands. Titan Shops ‘are watch shops run by experts with decades of experience’.
The intention was to get a share of the business accruing to these outlets. Titan initially named these
outlets, Titan Shops and later renamed them, Titan Time Zones.
Chart III shows the rationale behind Titan Shops.

The Third – Titan Dealers

By now Titan was entering new market segments with new offers. For example Titan entered the lower-
end markets, with offers priced between Rs 300–500. These decisions were part of the expansion strategy
of Titan. The big jump in production had to be accompanied by appropriate change in marketing strategy
and channel strategy. To capture big sales from the low-end markets, the showrooms and the Titan semi-
exclusive shops, were not sufficient. In fact, they served an entirely different buyer group. Titan naturally
turned to the traditional watch shops, spread out in the country, and offered them Titan’s dealership.
These dealers constituted the third component of Titan’s multi-mode retailing. Titan in fact, had two
kinds of dealers:
• Traditional watch shops
• Non-traditional (non-watch) shops
Traditional watch shops They are the multi-brand watch dealers who deal with all watch companies.
These outlets have shop areas ranging between 100 to 1,000 sq ft. Over the years, Titan developed a
network of 4,000 such outlets all over India. The advantages of this category of outlets are: (a) Locational
convenience: These are spread everywhere, even in small neighbourhood markets and are hence useful
in increasing market reach. (b) Choice for the consumer, as they carry many different brands of watches.
Naturally, consumer traffic is high.
Titan’s decision to use the traditional watch dealer, to penetrate the markets, proved correct. Today,
this category accounts for as much as 60 per cent of all Titan sales.
Non-Traditional (Non-Watch) Outlets – Gift Shops, Boutiques, Restaurants For market-
penetration, Titan also reached out to shops that sell other products. Since Titan employed what can be
described as the ‘follow-the-customer’ strategy in distribution, it went in for such non-traditional outlets
as well. Titan identified the Titan man/woman – the person who is most likely to buy a Titan watch – and
based on his/her psychographic characteristics, tried to catch them at the places they were likely to visit,
may be jewellery stores, boutiques, book shops, and even restaurants. Titan’s idea was to tempt the
prospects with a display of its fascinating watches at these places. Titan wanted to attract the discretionary
income of prospects towards Titan watches, away from not only other brands of watches, but other
categories of products as well, by using these non-traditional outlets. At present, Titan has 100 such
outlets. Titan, however, subsequently found that this category of outlets were relatively uneconomical.
There is hence an uncertainty about their future role in the overall channel scheme.
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By 2001, a strong channel in place

By 2001, the number of Titan outlets reached 6,000. This included 140 Exclusive, World of Titan shops,
and 150 multi-brand Titan Time Zones.

Institutional buyers, another channel

Titan also used institutions, mainly corporates, as a channel. It offers custom-made watches to corporates
in bulk to be distributed among their employees, mostly as company’s gifts. Titan sells the watches to
them usually through carrying and forwarding agents (CFAs) and in some cases through the redistribution
stockist (RS)/retail outlets. In either case, sale takes place as per terms fixed by the company. Titan has
prescribed a minimum order size for this category – either 10 pieces or Rs 10,000 in value terms.

Defence services’ canteen stores

Titan also chose the armed forces’ Canteen Stores as one of its retail arms. It supplied its watches to the
canteen stores in bulk for sale to its members.

Online store
By now Titan had launched special offers for the young, and sporty. They included modern Digital
Watches; and the range included World Time, the Globe Trotter and Fast Track. The latest ‘space age-
looking’ digitals and the futuristic ana-digi models priced in the price range of Rs 600–Rs 1,500, had to
be made available through channels frequently accessed by the modern affluent youth. Internet was the
obvious choice; Titan launched its online stores.

ITC e-choupal another channel

A recent study, conducted by Titan Industries, revealed that 50 per cent of watch purchases taking place
in the country is accounted by rural India. It was also found that some of the sales taking place in urban
India were made by people who come to cities from the villages to buy watches. Titan already had the
brand Sonata, in the price category of Rs 350–Rs 800, positioned for rural India. But it was not made
available through rural outlets. Sonata, which has around 350 different models, accounts for a good
35 per cent of Titan’s Watch division turnover. Titan decided to take Sonata to approximately 25,000
villages all over India. And the channel chosen was ITC’s e-choupal rural distribution network.

High service standards too had its influence on channel choice

Customer service was another strong point in Titan’s marketing strategy. Titan understood that in most
businesses, service is neglected and poor service often is the cause of the hurt feelings of a customer.
Titan, therefore, laid down its ‘service objectives’ very carefully. To quote Titan, ‘It is our belief that,
when a customer walks into a shop to get a Titan watch serviced, there are in fact three types of repairs
which need to be effected: repairing the watch, repairing the feelings of the customer and repairing the
damage done to the company’s image. Attention, therefore, has to be given to the physical environment
in which the customer is received, the manner in which he or she is dealt with by the service personnel,
the speed and quality of the actual repair job and the charges collected for the repair.’ Such a corporate
concern for the customer and for the quality of service rendered to him was not a common feature in the
then prevailing Indian business scene. Titan’s decision to use service as an important route to deliver
value to customers also impacted its channel decisions.

Multiple retail modes matching multiple segments

In summary, Titan’s different retail arrangements had their respective individual rationale and there was
also a basic logic as to why Titan opted for a multi-modal retail arrangement.
As explained in Exhibit 18.7, in the chapter on Market Segmentation and Targeting, (Chapter 18),
Titan in course of time identified and cultivated many different market segments for its watches and
made distinct offers to each. Titan found that different retail arrangements were required for the different
segments.
There were three major segments to begin with; more segments were added in course of time.
The first segment consisted of the high income/elite consumers who bought a watch as a fashion
accessory. To them, prestige mattered very much. They were also impulse buyers. The Titan showrooms
fitted them well. The non-traditional (non-watch) outlets too served them.
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Chart IV Responsibilities of the RS

• Maintaining stocks; the RS maintains a stock of four weeks’
sales at the minimum.
• Selling to retailers; the RS service the orders from the retailers
– orders that are for a minimum of 10 pieces.
• Delivery; the RS arrange transportation through vans/buses
to all retail points, including those in inaccessible areas. They
are required to deliver within a lead-time of three-four days.
• Providing product information to retailers/customers.
• Providing service support to the retailers.
• Providing credit to retailers.
• Facilitating exchange of products among retail dealers where
needed.
• Providing market intelligence to the company.

Chart V Rationale Behind Redistribution Stockists

• They reach the small retailers and the up-country retailers,
who cannot be directly serviced by the CFAs.
• They help penetrate the credit market. Titan’s policy does not
allow the company to extend credit to customers/retailers on
its own. The RS arrangement comes to Titan’s rescue in this
regard, as they can take care of the credit aspect.
• They attack the mechanical watch market and achieve a switch
over from mechanical to quartz watches.
• They facilitate expansion in service

The second segment consisted of middle-income consumers to whom both fashion and price mattered
while buying a watch. While they were willing to pay the price needed for a quality watch, they would
not buy their watch without comparing what else the market had to offer in terms of quality and price.
They would naturally look for watch shops that offer reliable, trusted products of different makes. Titan
Shops/Titan Time Zones suited them well.
The third segment consisted of lower-income consumers, who bought a watch as a time telling device
and bought mainly on price. Titan had initially concluded that it would not target this segment at all.
Later, its target expanded to include this segment and Titan catered to it using Timex watches. The Titan
dealers/traditional watch shops suited this segment well.
Now, more segments were created. Titan tried to cultivate the urban youth and children and started
online shops to conveniently reach them.
To reach the gift market it opened outlets in high profile gift shops, restaurants and boutiques.
To cultivate the rural market in a big way, it lined up with ITC’s e-Choupal.
To serve institutional buyers like corporates, it gave them access directly to the company (through
CFAs/RS) at special prices.

Titan’s dealer network today

Titan watches are now sold from more than 6,000 retail shops, spread throughout the country, covering
all major cities and 1,200 towns. They are backed by a wide service network. Titan’s 225 exclusive
showrooms (World of Titan) and 150 multi-brand showrooms (Titan Time Zones) initiated a new trend
for watch retailing in India. The ‘showroom’ has indeed been the key to Titan’s distribution strength and
it forms an important part of the company’s marketing strategy.
As the company entered suburban and rural markets, traditional watch dealers were further added and
today there are 6000 such dealers and 30 distributors, in its fold. Titan stocks 17,000 SKUs at any given
point of time.

The Back Arm of Titan’s Channel Structure

While the various categories of retail outlets, plus the institutional buyers formed the forward links of
Titan’s marketing channel, its back arm consisted of:
• Carrying and forwarding agents (CFAs)
• Redistribution stockists (RS)
The CFAs and RS serviced the retail network. Titan needed these two components for servicing its
retail operations because of its extensive, intensive, and multi-modal, retailing operations.
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Carrying and Forwarding Agents (CFAs)

Titan uses a band of CFAs to service its multi-mode retail system. The CFAs are an extended arm of the
company and constitute the first level of Titan’s distribution channel. Their job is to stock the watches,
sub-distribute them to the retailers and raise invoices on them. The CFAs do not buy the goods; goods
remain the property of the company and are just stock-transferred to the CFAs. At present, Titan has
around 40 CFAs located all over India. Each CFA has a couple of Titan salesman stationed with him, who
interact on a regular basis with the retailers in the territory.

Redistribution Stockists (RS)

Titan has also established a network of redistribution stockists (RS). The RS reach retailers in 1,250
towns out of a total of 4,000 towns that are reached by Titan. (Titan reaches the retailers in the other
towns through CFAs.) In towns where the retailers are reached through RS, the RS penetrate about 70 per
cent of the retail outlets. The RS account for more than half of the total sales of Titan. Chart IV explains
the responsibilities of the RS.
The redistribution stockist arrangement had its rationale. It is shown in Chart V.

Achieves Market Leadership Through Creative Retailing

Today, Titan is the leading watch brand in India. Highly insightful and creative experiments in distribution
have been a key input in securing this position. Titan’s retail strategy was shaped around the recognition
that total product offer extends far beyond the physical product – it includes how it is sold and wherefrom.