Arvind Brands’ Competitive Position in the Indian Branded Apparel Market Presented By: Chandranath Banerjee Debsadhan Chaudhary Kunal Dadlani Prantik Ghosh Rajat Saxena
Arvind Brands’ Competitive Position in the Indian Branded Apparel
Market
Presented By:
Chandranath Banerjee
Debsadhan Chaudhary
Kunal Dadlani
Prantik Ghosh
Rajat Saxena
CONTENTSIntroduction Apparel Industry Analysis of Arvind’s Brand Portfolio
Arvind’s CompetitionGrowth StrategiesSWOT AnalysisPORTERS FIVE FORCES AnalysisBranding StrategiesIssues
Conclusion
INTRODUCTION
Established in 1931 by the Lalbhai brothers of Ahmedabad.
Birth of three new units in 1993 - textile, telecom and garments
division.
Arvind Brands Ltd was a Rs. 3.50 million subsidiary Arvind Mills
Major stakeholder - ICICI , 2004.
Arvind Mills reacquired ICICI’s stake by raising US$ 37.19 million
Arvind Brands became 100% subsidiary of Arvind Mills in 2005.
INTRODUCTION
All the brands under the Arvind name were growing at a
healthy rate in 2004.
Plans to sustain growth by increasing retail presence.
Saif Ali Khan appointed brand ambassador for the
Newport brand in 2005.
Strategy was increasing distribution and penetration.
Competitive edge-zero excise duty and economies of scale
THE BRANDED APPAREL INDUSTRY
Multi fibre agreement
Characteristics of the industry.
Growth of the industry.
Important segments-jeanswear
Important trends in the industry.
Major players-Bombay Dyeing , Raymonds and Pantaloons.
ANALYSIS OF BRAND
PORTFOLIO
Parameters to judge portfolio
Maximizing brand equity : one brand should not harm others.
Branding strategy according to breadth and depth.
Segmentation, targeting and positioning of brands.
Breadth of branding strategy
The number and nature of different products linked to the brands sold by a firm.
Depends on:• Aggregate market factors• Category factors• Environmental factors
Depth of a branding strategy
Number and nature of different brands marketed in the product class sold by a firm.
Helps in • Increase shelf presence and retailers
dependence• Attract consumers seeking variety• Increase internal competition
Golden rule : Maximize coverage and minimize Brand overlap
Arvind Brand Basket
Flying Machine Newport Ruf n Tuf Excalibur
Launched 1980 1993 1997 1995
Age group 15-30 18-28 15-30 18 & Above
Price range 500-1000 300-500 299-699 500-1000
Difficulties faced
Hike in exise to 8%
Hike in exise to 8%
Distribution hurdle
----
Retailer own outlet own outlet Big Bazaar
Brand ambassador
Abhishek Bachchan
Saif Ali Khan Akshay kumar ----
Tag Line Who Needs Phoren?
The Measure of Success
---- ----
International BrandsArrow Lee Wrangler Tommy Hilfiger
Licensed Cluett, peabody & co., USA
VF corporation VF corporation JV with Murjani group
Age group 27-35 4-14 & 17-25 17-25 &25-40 18 & Above
specifics Four sub brand•Classic•Premium•Urban•Sports
Adjudged the images fashion award “most admired Jeanswear” brand
•Fashion conscious•Love wearing denim on weekend•Retail ambience was given importance
Introduced men’s sportswear, men’s Jeanswear, junior Jeanswear
Why so many brands ?
Aggressive strategy to verticalize its operations.
Vision of largest apparel brands.
To attract different segments by heterogeneous mix.
Facilitate new brand acceptance
Reduce risk perceived by customers
Improve efficiency of marketing.
Competition
Major Competitors Of Arvind Brands
Madhura GarmentsIt’s was the garment division of Indian Rayon and Industries Ltd. A flagship company of the A V Birla Group Company.
Owns perpetual license for premier brands like – Louis Philippe, Van Heusen, Allen Solly, Peter England, Byford, Elements and SF (San Frisco).
Preferred global supplier of international brands like- Marks and Spencer’s, Tommy Hilfiger, Polo, Ralph Lauren, and several others.
It distributes its brands through its own retail chains namely Planet Fashion and Trouser Town.
Brand Portfolio of Madura Garments
RAYMOND APPAREL LTD
A 100% subsidiary of Raymond Limited, Raymond Apparel Ltd. (RAL) ranks amongst India's largest and most respected apparel companies
They provide the best of fabric and style through some of the country’s most prestigious brands – Raymond Finely Crafted Garments, Manzoni, Park Avenue, ColorPlus, Parx, Notting Hill and Zapp!
All of Raymond’s brands are available at exclusive brand stores, ‘The Raymond Shop’ retail outlets and multi-brand outlets across India and the Middle East
RAYMOND’s BRAND PORTFOLIO
INDUS LEAGUE
Indus-League Clothing Ltd., was founded on 14th April 1999 by a team of eight top-flight management professionals from the clothing industry. These professionals have established a reputation for creating and building some of the most successful fashion brands in South Asia and the Middle East.
Within an year Indus League had transformed itself from a new entrant into a company that has launched two fashion brands namely Indigo Nation and Scullers
Indus-League has a portfolio of Three proprietary brands - Indigo Nation , Scullers and Jealous covering different segments of the fashion market.
LEVI STRAUSS & CO.
Founded in 1853 by Bavarian immigrant Levi Strauss, Levi Strauss & Co. is one of the world's largest brand-name apparel marketers with sales in more than 110 countries
In 2009 it completed 15 years in India
It expanded its portfolio from being a jeans only brand to emerge as the complete casual wear brand
4 sub-brands Sykes, 501, Red Tab and Red Loop
Levi Strauss’s Brand Portfolio
PROVOGUE The Company was incorporated on November 11, 1997 as Acme Clothing
Private Limited.
Provogue stands for fashion and not pure apparel. Its designs are contemporary and cutting edge
Provogue’s brand statement “ Redefining fashion” and its innovative merchandise have created a niche in the minds of its consumers.
The brand is retailed through selective stores in the country and leading National Chain Stores like Shopper's Stop, Lifestyle, Globus, Westside etc.
More importantly, Provogue is also retailed through a chain of exclusive brand outlets called "Provogue Studio"
PROVOGUE’S PRODUCT RANGE INCLUDE:INNERWEAR , T-SHIRT , BOTTOMS , JACKETS & BLAZERS , DENIM , FORMAL SHIRTS , LINEN SHIRTS , CASUAL SHIRTS, FOOTWEAR , SUNGLASSES , FRAGRANCE , CAPS, BAGS , BELTS
ARVIND’S GROWTH STRATEGY
As on 2005, Arvind was in a comfortable position.
Focus on retail------Company want to achieve 80% of its sales through apparel.
Change from Centralization to Decentralization
Clustering of Brands
ARVIND’S GROWTH STRATEGY(Cont..)
Globalization Strategy
• Acquiring rights of Reds in North and south America• Exclusive stores in Gulf to showcase its brands
Launching of Spectrumplaza.com
Tie ups with Indiatimes.com and rediff.com
SWOT ANALYSIS
Strong portfolio of domestic and international brands
Economies of scale through complete integration
Latest manufacturing tools
Wide geographical presence
STRENGTHS
WEAKNESS
Lack of fresh ideas
Presence in only big cities
Not doing enough to build brand equity
OPPORTUNITIES Changing retail scenario
Rapid growth in age group of 15-44
years
Ability and willingness in India
THREATSCompetitors like Raymond, Bombay
Dyeing, Madura Garments
Cheap imports from China, Thailand,
Bangladesh
Excise duty
PORTER’S FIVE FORCES MODEL
COMPETITIVE RIVALRY
Competitors adopting aggressive growth strategies as well as eyeing top cities
Huge number of competitors
Stiff competition from small town stores and specialty stores
THREAT OF NEW ENTRANTS
Lucrative market for international brands
Low entry barriers in unorganized retail
sector
THREAT OF SUBSTITUTES
•Plenty of offerings in premium and super premium category
•Small town stores – proximity, home delivery, personal attention
•Growth in online shopping
BARGAINING POWER OF SUPPLIERS
Increased no of players increases bargaining power of suppliers
Not all companies have complete integration (like Arvind)
BARGAINING POWER OF CUSTOMERS
Low switching costs
Low customer loyalty
BRAND HIERARCHY
The apparel industry did not follow the umbrella branding
strategy
Arvind divided its brands into 4 clusters and each cluster had its
distinct marketing strategies
Corporate or Company Brand: Arvind Mills
Family Brand: Arvind Brands Ltd.
Individual Brands
- Licensed Brands: Lee, Wrangler, Arrow, Tommy Hilfiger
- In-House Brands: Newport, Ruf n Tuf
Modifier: Leesures by Lee
POP & POD
Points of Parity
•are the attributes or benefits which the brand shares with other brands
Points of Difference
•are the USPs of a brand, distinct from others
In this case, Arvind’s POD’s are not well defined. Their
offering, target audience and positioning is very similar
to its competitors.
CHANNEL STRATEGIES
Indirect Channels
• ex. Multi brand store, small town retailers
Direct Channel
• ex. Company-owned stores
Arvind was shifting its focus from multi brand and
small town stores to company-owned stores
PUSH & PULL STRATEGIES
Pull Strategies
• are the ones directed towards end consumers ex. Television ads
Push Strategies
• are directed towards distributors and retailers. Ex. Trade discounts
Arvind mainly concentrated on Pull strategy ex.
endorsements by Bollywood stars like Akshay & Saif. Push
Strategies weren’t required as they were concentrating on
company-owned stores
OTHER CONCEPTS
Brand Extension: when different products are manufactured under same brand
name. Ex. Arrow started off as a shirts-only brand then diversified into casuals,
jeans and accessories like belts, wallets etc.
Forward Integration: Arvind Mills, which manufactured fabrics, integrated
vertically forward by launching its in-house brands and retail stores.
Brand Endorsement: associating a popular figure as the brand ambassador to
give the brand a personality and strengthen its positioning ex. Action star
Akshay Kumar was roped in to endorse Ruf n Tuf to give it a tough & rugged
look.
ISSUES
Lack of new ideas
Inability to keep up with the changing market demands
Unwilling to place its products in multi-brand stores
thereby losing customers in the tier-II, tier-III cities
Tough competition from local and international players
Just one offering for the bottom of the pyramid (Ruf n Tuf)