EMERGING TRENDS

Demographic pattern

Rising % of young population

Increase in income levels

Changing spending pattern

Effect
Increased size of urban population

Consumerization of Urban India

Increase in spending power Rising aspiration levels

Enablers

More number of working women

Outcome

Consumption of lifestyle items

Organized retail market at USD 21.5 billion by 2010 (CAGR 31%)

Demographic patterns

Two third of Indians are below 30 yrs

Median age is 24 (35 in US, 41 in Japan)

Urban growth at 3% vs 1% overall

Effect

WATCH ???
Youth growing four times faster

Enablers

82 million at 20-34 age in 2006

Liberalized population will be 56% in 2011 (41% in 2001)

Outcome

Significant new opportunity from young urban indian consumers

Forces behind transforming the indian watch industry

The Indian market is estimated at 25 million watches a year, with 50 per cent being sold by the organised sector. Titan is the runaway market leader, with domestic sales of 6 million watches a year. There are 190 million watch-owning Indians; between them they own about 210 million watches. Urban India accounts for 120 million of these watches and 90 million are on rural wrists. More men than women own watches in India, and more working women than housewives own watches.

The Road Ahead

Tapping the rural market
Huge size of the rural market.
As tele-density and infrastructure of the rural India improves, it offers scope for sophisticated form of advertising and method of sales. Launch of Sonata range of watches by Titan in the rural market has met with great response from the buyers in rural and semi-urban India. Indian rural bazaar is displaying a market trend towards consumerism and demand for durable products.

 Incorporating new functionalities in the wrist watch with the help of new technology
Spot watches which offer advanced features such as automatic time adjustment based on location, access to continually updated content such as news, traffic alerts, weather reports, stock quotes, sports scores and instant messaging. The Times Data Link watch utilizes a revolutionary new communications technology that literally zaps information from personal computer (PC) to watch. IBM Linux-based wrist watch.

 The Watch Industry `

Evolution Global perspective

Indian Watch Market

Evolution Trends Price segmentation

AGENDA

Consumer Behaviour Major Players

HMT Watches Ltd. Titan Industries Ltd. Timex Watches Ltd.

Industry Analysis
Positioning Advertising Distribution Branding

Future Trends

The Watch Industry Evolution

Conventional watches standard spring powered watch Conventional watch evolved into electronic watch Varieties:
Jewelled lever watches (complex and expensive) Pin lever watches (recent development)

New generation watches evolved from electric watch to Tuning Fork watch and ultimately settle at Quartz Crystal electronic watch Major players Switzerland, Japan and United States 60% Quartz, 27% Digital, 13% Mechanical
Source : Segmentation of the Indian Watch Market Y.L.R. Moorthi, IIMB

Indian Watch Industry Trends

Rapid increase in target audience Rise of consumerism and purchasing power of the middle class Bulk of the demand exists in lower and middle segments Newer segments jewellery segment, etc. Rise of demand of trendy watches

Indian Watch Industry Price Segmentation

SEGMENT AVERAGE PRICE MARGIN (ESTIMATED) Mass market Rs.450 11%

Popular

Rs.750

15%

Premium

Rs.1200

18%

Super premium

Rs.3000

22%

Consumer Behaviour
Transition from mere time keeping device with functional benefits like durability, toughness and economy to a personal wear reflecting peoples lifestyle and aspirations
Multiple ownership

Price sensitive

Durability and utility are important aspects

Aesthetic appeal and trendy designs are very important Brand Name continues to be an important driver in the customers mind

Availability in different segments and for different occasions makes the watch a suitable gift item

Strategies
Targeted the global market State-of-the-art technologies IT Infrastructure
Very wide range of products in terms of looks, function and price points Noted for their workmanship and reliability
Reputation of being excellent value for money

The Signet Club

Customer loyalty programme

Delivering quality products at affordable prices Basic objective: Change the mechanical watch user to a quartz watch user
Tap the untapped

Transition from plastic to metal

To become market leader

Launched Vista brand in Rs 475 Rs 900 range

To appeal to small town customers

Positioning
Positioning based on age, sex, competition Teenagers
Pace(swiftness,speedy) The young and teenagers, who are looking for their first watch FEMAL The low ownership segment like women

Older customers
Astra

The male segment

Roman

First watch company to launch watches for children

Zap

Continued
Middle and upper segments of society
Price range of Rs 500 Rs 5000

International watch at Indian prices

A watch that builds your image A brand which represents style, status and technology
A Good Looking Watch

You don't have to be rich to afford a Timex Lower price segments Youthful and trendy For the discerning Sportsman Premium segment
Technologically superior multifunctional brands like Datalink, Indiglo

Distribution
Manufacturer Dealer Retailer Customer

Established a strong distributor network of 10,000 distributors and 50,000 retail outlets
First to go for exclusive showrooms
Did away with retailers Wholesellers importance reduced

Set up a chain of service centres, with close proximity to the marketplace Innovative planning of showrooms
Watch buying a pleasurable experience

Extensive use of C&F agents to reduce distribution costs

Advertising
Huge early investments Catchy slogan If you have the inclination, we have the Time Portrayed nationalistic instincts
Timekeepers to the Nation
Targeted the typically price sensitive yet discerning Indian customer
International watch you can pay for in rupees You dont need to pay in dollars, pounds or dirhams to buy a Titan watch To find watches like these you dont have to go to Europe, Japan, America or a duty free shop Next time your husband wants to buy you a saree, ask for a Titan watch instead

Targeted the premium segment of look and fashion conscious customers Promoted the concept of a watch being the ideal gift

The rationale behind their ads being constant bombardment if the Titan brand name Ads are a blend of sophistication and simplicity

Other Players
(who lost the market)
Westar
Almost closed down No Brand Equity Upper segment cluttered Lack of distribution strength Launched in 1996 Southern and Western markets Fashion accessory In problem Assembled watch Water proof watch Rs 350 Failed with the launch of lower priced Titan and HMT products Analog and digital watches (branded IQ) Failed due to lack of sustained promotion and marketing Now planning to cut prices Launched in 1981 Sourced watch movements from Seiko Lost out due to Organizational problems (PSUs)

Shivaki

Maxima

SITCO

Hyderabad Allwyn Ltd.

The Road Ahead

More and more focus on new technology and multi-functional utility
Timex are the leaders in this area with watches like
Internet Messenger Digital Heart Rate Fitness System

Watch consumption in India 20 units/1000 people as opposed to China 50/1000

Scope for increasing the demand of watches

Top 23 cities: 80% of Watch market

The focus should increase on spreading the market to rural areas

Greater price segmentation, sp. lower end

2 fold advantage: Demand, Market spread

Greater competition from invisible sector and foreign brands