Marketing Plan for Titan Industry

TITAN INDUSTRIES-WATCHES (MARKETING PLAN)

BY

ASHUTOSH KUMAR SINGH

&

NETAI KHATUA

FROM

ICBM –SCHOOL OF BUSINESS EXCELLENCE

ASHUTOSH KUMAR SINGH6/3/2009

TITAN INDUSTRIES-WATCHES

Executive summary:

Titan’s watch segment is the India’s chief producer of watches and ranks fifth in the world in production of watches.

Company really understands the psyche of consumer and they offered quality products in classical design with superior technology.

Today the company has model for every prices segment and every market. Basically it deals with three target market

High income groupMiddle income group, andLower income group

Titan alone holds 70% market share in domestic level whereas 60% in organized market.

As our Marketing Objectives is to increases Market Share of the company by 5% in the coming year as well as to increase the profitability of the company by 10%.

The competitor are also playing an important role to grab the market share .We as the Marketer try to increase the market share by grabbing the opportunity from other company. To achieve this the company have to follow the marketing strategies, which basically include the MARKETING MIX.

The marketing strategies basically include the 4 ps .

There the marketer have to focus at first on PRICE ,which basically for The titan is not affordable in the Mid –Segment, where as the competitor like HMT and Maxima are doing good business by holding market share of 45% where as titan hold the only the 32%,there fore it is important for the company to reduce price in mid –segment.

Though in the improperness or in innovation of the Product, Titan doing well, but there is need of few changes. For example HMT, the nearest competitor innovate ‘BLUE CHIP’ in the watches.

ICBM-School of Business Excellence Page 2

http://www.titanworld.com/collections/series/WWF


We also have to implement this type of innovation to bring the flexibleness in our product.

As it is also important to do some creativity in advertisement by showing the importance of Time to the mass. The company brand promoter is Amir Khan but the company can make it attractive by endorsing Katrina Kiaf .

The place can be taken into consideration ,as it is need foe the company to open some show rooms in the rural area and as the company don/t have so much market share in the foreign market ,so to expand the business company should launch its showroom all over the globe in the more number.

Market share of the competitor in domestic market

HMT 19%

Maxima 13%

Rado 7%

Casio 3%

The strongest selling point of Titan is that it is available and affordable. Titan provides watches for all segments, like from low-cost Sonata for first time user, Fast-track for the trendy young, Dash for the kids, and the higher priced Regalia and Nebula to the premium segment customer.

The Indian watch market is estimated at 25 million watches a year, where the domestic sales is 6 million watches per annum. The rural segment is the diverse market in the present scenario. The key success story of Titan is capturing the rural market on a large scale. The range costs is between Rs. 495 to Rs. 1200. And the model is available exclusively in all showrooms and is sold mainly in small-town in India.

Though the company faced enormous challenges from its big list of competitor, the company still in the number one position in domestic market because of the weakness of the competitor.




The company becomes more reliable and more acceptances to the consumer because of its marketing mix. The company has adopted the new marketing innovation to improve the feature of the product by time to time.

Though the current financial environment is not in favor, but the company performing well and saw an increasing trend in the profit chart.

The company trying hard to convert its weakness into strengths and threats into strengths and threats into opportunities by bring revolution in the product style, model, features, pricing policy, product quality, etc.

Companies certain initiatives and policy such as new innovative design, guarantee, the research and development, wide dealer network, committed service team, discount and offers make the company.

Introduction

When we talk about the “wristwatch brand”, remember the only Indian wristwatch market were so shabby, one more ordinary than other and when the craze for “imported watch” was not implemented. That was before the time of titan, a name which brought the revolution in the Indian wristwatch market.

Titan wristwatch brand is the part of titan industry, which was launched in 1987 by TATA group. TATA group had indentified the watch category as a potential consumer market for the TATA’s to enter.

Xerxes Desai, a TATA veteran and the MD of TATA Press was elected to that business.

By offering quality products and classic design with advanced technology to the consumers, Titan made a success story. Outstanding services, wide variety of models and effective marketing helped Titan to capture the market in its born stage.




The reason behind the success of Titan watches was their research on the Indian consumer psychological mind. The company today has a model for every price segment and every market, urban and rural, regional and international.

Titan brought quartz technology first in the Indian market and acquired first place by displacing HMT into second place, who offers mechanically driven wristwatch.

It also brought a sense of style and design, which is only available in the West or in Japan at that point of time.

Environmental analysis

A. The marketing environment.

Competitive Forces

Major Competitor

There are lots of competitor in wrist watch segment which directly or in directly affecting the titan watches industry. The major players’ are-

Domestic Level:




HMT Maxima-quartz Rado Casio

International level: Espirt Swatch Citizen Tag heuer Seiko Cartier Giordano

Fashion Houses: Dkny Gucci Adidas Nike Bvlgary

Among all these competitors, Maxima-quartz and HMT are major players .The strength and weakness of the companies varies from segment to segment.

Maxima-quartz:

Strength: hitting hard at mid-price market.

Weakness: lagging behind because of quality compared to Titan.




HMT:

Strength: turnover is very high because of low price (average price for Titan is Rs.1100 while the price for HMT is Rs.550).

Weakness: the quality, attractiveness, varieties are less compared to Titan Industry.

1. State-owned watch maker, HMT, compete in the domestic market after almost a decade.

2. International player like Espirit, Swatch and Citizen compete in the mid-price segment and also trying to enter in the domestic market.

3. Timex also making a spiritual comeback by capturing the mid-price segment.

Though the future is uncertain, but according to the present performance of all these companies, we can assume that they would be the major future competitor of the Titan wristwatch.

Expectation from the competitor

As we all know that marketing mix is basically consist of 4 p’s i. e price, product, place and promotion.

Price:

Advantage: competitor of mid-price segment will capture the whole market.Disadvantage: competitor of premium price segment will enjoy the more market.

Product:




Advantage: Increased in the quality will increase the cost which will give benefit to the competitor.Disadvantage: Quality decrease will help competitor to capture the whole market.

Place:

Advantage: more number of places of operation will make the competitor week.Disadvantage: less number of places of operation will leads to wipe out from the market.

Promotion:

Advantage: Increase in sales promotion will affect more market share.Disadvantage: decrease in sales promotion give benefit to the competitor.

Industry’s Role

As there have many competitor exists in this Industry, the competition is too much. Whenever any company bring changes in its marketing mix, all the companies also implement changes in their marketing mix to sustain in the competition. By that the structure of whole industry is changing and affects the competitive forces in the Industry.

Economic forces

Economic landscape

Indian corporate sector is nervous because of current Inflation. This problem occurred not only in India, but it affected all the countries due to United State financial crisis.




As we came to know from Federation of Indian Chamber of Commerce and Industry (FICCI) that 64% of the 413 companies are running currently in worst condition from last 6 months.

Consumers view

As we know that Inflation is in double digit figures, but the people who lives in urban area or metro city, are having optimistic view towards economy.

People think that the economic condition of our country will be improved in the near future.

Purchasing power of consumers

BRAND PURCHASING POWER (PRICE) RS.

CATEGORY

FAST TRACK 550-1,430 YOUTHEXCTA 595-1,430 LOWER MIDDLE

CLASS(Office wear)SPECTRA 650-1,830 COMMON CLASSROYAL 960-2,830 UPPER- MIDDLE

CLASSRAGA 1,420-4,000 UPPER CLASSBANDHAN 1,675-8,085 COUPLESREGALIA 1,725-7770 UPPER MIDDLE

CLASS-UPPER CLASS

EDGE4,500-5,200 BUSINESS CLASS

NUBULA 10,000-45,000 UPPER CLASS




The company’s watch sales grew by 18.8 per cent and its income increasing from Rs255.34 crore during the second quarter of last year to Rs303.45 crore during the second quarter of this year. On the basis of the above table and profit figure we easily understand consumer buying power in target market.

Spending habit of consumers

Despite of high inflation, high oil prices and high volatility in gold prices, watch segment of Titan Industries doing well in the current fiscal. For these, watch segment sales income increased from Rs.168.83 crore during the first quarter of last year to Rs.171.89 crore during the corresponding period this year. These data indicate that consumer’s spending pattern is increasing respective target market.

From the above information we can easily understand that consumers buying more of Titan wristwatch. There are few reasons behind the growth in sales of Titan .They are as follow.

Brand name Quality of the products Features ,which differentiate from others Attractive models New innovation

Political forces

Political landscape:

In 2004 /05 the new Government came through election in India.

Our new Government took lots of steps to make the global relation as well as some steps to develop our country GDP, decreasing the rate of Inflation by decreasing rate of Cash Reserve ratio (CRR) as well as by decreasing the Repo rate. These all steps help the Industries to get sustain in the market.




As all the steps help the Titan industry to compete in the watch industry. The performance of this sector for last few years are-

Revenues:

1. Significant growth over the past three year.2. Rs.880 crore sales during the latest financial year (over Rs.1000 crores at retail prices)

PROFIT ROCE* PBT (2005/06) - Rs. 90

Crore* ROCE (2005/06) - 50%

* PBT (2006/07) - Rs. 96 Crores

* ROCE (2006/07) - 50%

* PBT (2007/08) - Rs. 121 Crores

* ROCE (2007/08) - 56%

Relation with political officials

As we all know that TATA group is the one of reputed companies in the world, it really helps the country development.

Moreover, the companies always want to make good relation with the political parties, because we know that India is a democratic country which is it- self elected by the people the country.

Legal and regulatory forces




As the titan industries operates their business in the global area ,they have to follow lots of regulatory norms.

The industry can be directly affected by the certain rules such as change in Taxation rate.

Technological forces

Impact of Technology

Changing in technology always play a great role in the target market. Titan decided to manufacture only QUERTZ (Analog and digital) and not mechanical and they would start plant to manufacture watches in wide variety in design and prices.

Titan changes the technology in that ways which help in enhance the quality and the features to increase buyers’ value. Titan gets advantages in the target market through innovative technology.

As there is too much competition, if Titan not accept the changes in technology then they can’t sustain in the market. In premium segment, competitor will capture whole market by improve technology. And in the mid-price segment, other companies will give a tough competition to titan.

Technological changes

The new marketing innovation can bring a drastically changes in the marketing activities of the company. The new innovations which can differentiate the company from the competitor are

Implementation of Heart-beat checking system in wrist watch. Implementation of Blood pressure checking system in the wristwatch Some companies can come with the watch which help in knowing the mood of the

person.




Sociocultural Forces

Tata believes that improve the quality of the life of people and the employee is the primary purpose of their business. It uses its resources in the best possible way. They also takes some reasonably steps to improve the quality of life of the people of the areas in which they operates.Tata adopt the Corporate Citizenship Index, Tata Business Excellence Model and Tata Index for Sustainable Development which reflect its commitment to its Corporate Social Responsibility (CSR). Tata spends 5-7% of its profit after tax on several CSR initiatives.These CSR initiatives are spread across three core areas, such as employee welfare, the environment and the welfare of the community at large.

B. Target market

Identification

The titan industry basically deals in three segments for its watches. They were as follow.

High Income/Elite consumers

In this segment mainly the consumer who buys a wrist watch as a fashion accessory.

Middle group:




In this segment mainly consumers like some fashion in their watches. These consumers would not purchase a watch without comparing various offers in the market.

Lower-income people:

This segment mainly consisted of lower- income consumers who want watch mainly as the time –keeping device and purchase on the basis of price.

Need Analysis:

Consumers need

The demand and the need vary one market segment to another segment on the basis of prices & quality.

The current need can be satisfied by the following ways in the different segment.

High class: Titan offered Aurum and Royale in gold watch range .They were stylish watches in all gold and precious metals.

The price is between Rs.20,000 -1,00,000. Middle income class: Titan offered the Exacta range in stainless steel. There were

100 different models in the range. The prices ranges are between Rs.500-700. Lower-income group: Titan offered the Timex watches and later, when the

arrangement with Timex was terminated, the SONATA range.The prices ranges were Rs.350-500.There was 200 different models in the ranges.

Current Marketing Objectives and Performance:

Review of Marketing Objectives




Current marketing objectives of TATA is to strengthen India’s Industrial base through the proper utilization of resources like employee and materials. Besides, the company seeks to reach the height of excellence atmosphere which is free from fear and threat.

Performance Analysis

Titan Industries achieved significant growth during the year ended 2007-08. Watch segment sales also grew by 17.2 per cent to Rs 918.7 crore. All brands of the company have performed well and new introductions in gents’ watches, the Raga Crystal for ladies.

Three year overview of income and capital employed:




Income capital employed

In India 70% of the sales in wristwatches come from the lower segment. So, Titan capture the market by pricing the Sonata at Rs. 350 onwards. It consist of Tata guarantee. Titan prices its world watches which are compared equal to an international competitor like Calvin Klein. Here a customer pays about 4 times a value of the world watch hence penetrating the market with low prices to international players to gain market share.

In the Indian watch industry there is no one offering pure gold watches, watches in pair, Jewellery watches. This concept though exists with foreign competition has just come to India. TITAN offers these products with the Indian touch in its designs, the products, and the looks. Hence it is able to skim the market with certain products in these ranges.

III. SWOT Analysis

A. Strength:

1. Style: Titan first introduced the ‘style’ concept in India and projected the watch as a fashion accessory. Now a day’s style is a very much evident factor among the youth. And there is a craze for stylish wristwatch. So, Titan makes the peoples life more glorious by making stylish wristwatch.

2. Models: As Titan offers the best and the biggest range to customer to choose the watch of their choice with an affordable price.




It offers about 14 different names with about 1000plus different varieties with a watch for literally everyone.

3. Exclusive products: Today Titan holds the pride for say that its products both within the country and internationally running in battle position. Its EDGE the slimmest watch in the world position.

Other than these there have few more strength like-

4. Contribution of owned brands and retail. The profit is accounted by being in the retail space which is booming.

5. Watches are available with popular functions like dates, multifunction and chronographic.

6. Guarantee/warranty

C. Weaknesses

1. Pricing: the average price of Titan in mid-price segment is very high than the other competitor. Average price for Titan is Rs.1100 while the price for HMT is Rs.550. In the mid-price segment the company is not performing up to the mark due to the lack of choice of consumers.

2. Market share: As the average price of Titan wristwatch is far more than the other competitor, Titan has less market share. The market is more demonstrate by middle class people and for them Titan is quite costly. Among 75% market share in mid-segment. Titan market share is between 18-20% which is far lower than HMT and Maxima.

3. Globalized: As the company is Indian based which leads it to the strength, where as it is the weakness also because the company not sufficiently globalized.

D. Opportunities




1. Seasonality: At the time of festival, like Diwali Titan promotes Nebula, Bandhan because there is demand for the products.

- Gold watches and pairs are the like as a wedding occasion.-The fast track brand is promoted in month of June-August when schools and colleges re-open.

2. Gifting concept: Titan started as a brand which was associated with gifting and relation. The fight concept sells well for people have come to associate Titan with lovecare and makes emotion run high.

3. Exchanging offer: The Titan stores offer exchange offer of any old watch, of any make, in any condition functional or otherwise and receive a flat discount of 25% on their purchase of a brand new, stylish and technologically advanced watch from Titan.

D. Threats

1. Competitor: As we know that lots of Foreign brands are entering in our country with their branded watches. As the removal of quantitative restrictions on import watches leads to threat to titan.

2. Premium segment: As in premium segment Titan is getting threats from reputed international brand such as Espirit, Swatch and Citizen.

3. Mobile: Now a days people can get the time and the other feature in mobile phone. So, the need of wristwatch is in decreasing trend. People can talk and see the time in a cell phone and some people think that there is no need of wristwatch.

IV. Marketing Objectives:

Titan industries in watch holds 70% in Domestic level and 60% in Share in organized sector market.

Companies the marketing objectives is to increase in market share by 5% .




Before implementing the of marketing strategies we must have to focus on certain things ,which include the BCG Matrix representation.

Titan industries has registered an Income of Rs.1,104.85 crore as compared to previous year which was Rs 7,25.11. In all the income the Titan industry had contributed Rs.3,03.45 crore.




BCG matrix helps us to understand the watches playing a important role for Titan industries.

Here we are considering the different watches as in different segment according to its performance as well as the market share.

? (INFINITY):

As the Titan launched a 4 feet tall watch Replica created by acclaimed sculptor Artist Mr.Arun Verma .

The replica was launched on 13th August 2008 in New Delhi.




The INFINITY this unique 4 feet tall watch weight around 70 kgs with solid circumfarece of 8 feet and width of 30 inches. This watch contains 800 dials and 1800 straps.

TITAN -WWF:

The titan- wwf collection is inspired from six species namely the Tiger, Indian Rahino Gnagetic river Dolphin ,Red Panda ,Whale shark and Oliver Ridley Turtle.

Earlier they had launched Heritage collection about a year back based on beautiful monument of India including The Taj-Mahal, Lakshmi Vials Place, Jharokha, Konark ,Ajanta. As it is the new collection it requires more investment for Tiatn-wwf as the market growth is also high there.

It include the watches namely REGALIA, EDGE and NEBULA.

Cash Cow:

It basically include the watches Fast Track, Exacta, pectra for the titan. As in this segment these watches are playing important role so it require certain amount of money which will help it out to sustain into the market as well help in liquidity.

Marketing Mix:

PRICE PRODUCT PROMOTION PLACE

Price:




As achieve our marketing our marketing objectives, we can do some change in the pricing .

The main consideration will be in changing price are followings.

A. Survival:

In case of some of the watches titan prices them according to the features .The Exacta is a simple steel watch priced at Rs.600-1,100. As the company also deals with Spectra, Raga through pricing policy.

B. Market share:

As we know that 70% of sales in watches come from the lower segment, therefore by pricing Sonata at 350 onwards with guarantee.

Titan prices its world watches which compared equal to an international players like Calvin Klien where a customer pays 4 times as value of the world watch, therefore market with low prices to international players to gain market share.

C. Market Skimming: In Indian watch industry there is no one offering pure gold watches, watches in pair, jewellery watches. Here Titan offers there product with the Indian touch in its design, the product, the love.

Product:

Quality and leadership are the two main terms for the Titan. As to achieve the marketing objectives this aspects should also be considered.

A. Product line: To increase the sales, the difference in the prices of the watches are justified by the features.

B. Product pyramid: Portfolio of Titan’s product is of 3 distinct price-range that can be defined in general, as Popular, Mid, and Premium. At the popular segment, the emphasis is on in volumes but not in margins. At the premium segment, the emphasis is on profits and image but




not in volumes. Obviously, company giving more emphasis at the top of the pyramid as profits at the top of the pyramid is very high. This pyramid guided the strategy of Titan.

C. Product strategy: Titan was first focused only on the premium segment of the watch market. As per the product strategy they took, Titan moved in to the mass market for watches. To widen base, Titan created new segments and increasingly focusing on segments individually. In the past few years Titan has took a lot of initiatives to focused on specific segments.

D. Product Quality: Quality and leadership are synonymous to Titan. It seek to achieve both through their value for products compared to their prices.

Promotion:

Promotional pricing:

A. Marketing pricing: As by opening new shops such as the world of Titan – buy directly from the dealer and hence the element of middleman is not there.

Here the retailer in this category buys watches for 17-18% lesser than MRP and hence they are able to get the 17% profit margin on sales.

It is managing to successfully convince to the customer of the perceived value of ‘WORLD WATCH’ using hoarding all around the city, increasing buyer image, trust worthiness, innovation, differentiation, value for the product.

Price discount and allowances: Every year Titan comes with a price discount sale on the MRP of the watches. The allowances varies from one segment to another.

B. Creative advertising: Titan introduces a contest on cartoon network in india.com which invites children to use creativity and design watch.

The prize winning design was launched as a new watch in summer 2002 collection .




Type of advertising: Titan believes in making its ads clean, well made, touch on emotional chord. As the company is using celebrities or superstars that is Amir Khan for the Titan watches.

As here we can say that a female actress would be more effective for the promotional purpose. It can be Katrina Kaif, as now she is one of the popular actress in Bollywood.

C. Promotion on occasion: Titan is one of the company which formally believes in the policy of promotion the product based on the occasions.

Place:

Keeping in mind about the young trendy and fashionable consumers, Titan distribute its product and set up ‘world of titan’ in different region. The consumers life style in India, especially in urban area(because the turnover in urban area is 210 million, while the turnover in rural area is 90 million) plays a significant role in the success of Titan.

A.Time Zone: Titan Industries brings together the country’s leading watch brands under one roof, providing the customer with variety in brands, looks and price ranges and also efficient after-sales service. These 1142 Time Zones located across 89 towns which offer its customer the complete watch shopping experience.

B.Value Mart: These outlets sell surplus stocks of Titan watches at reduced prices. By doing these it offering fabulous value for money with the same warranty as a regular full-priced watch enjoy. However these shops would not be placed in the main locations and not working as a normal shops. This is to make the customer go to the shop rather than the shop calling the customer and hence the locations are not very suitable for shopping.

C.Sonata Stores: Sonata stores is also an Authorized Service Centre for Sonata & Titan brands. Sonata store meet the large scale demand for the watch and also to attract customers in more. These shops had full stocks of the watch in demand whereas the others could afford to maintain only limited stock.




D. Head office, regional office, showrooms:

Offices Address Telephone Fax Email

Corporate Office

Tower A, Golden Enclave Airport Road, Bangalore - 560 017

+91-80-6660 9000, +91-80-6660 9027, +91-80-6660 9028

+91-80-2526 9923, +91-80-2526 3001

[email protected]

Regional Office – North

No. 202, Okhla Industrial Area, Phase 3, New Delhi

011-66603260 / 66628680 / 26332619 / 26332620

[email protected]

Regional Office – East

Block 'C', 8th Floor, Apeejay House 15, Park Street Kolkata - 700 016

033-22495553 / 5556 22495167

[email protected]

Regional Office – West

The Metropolitan 9th Floor, Plot No. C-26/27 Bandra-Kurla Complex Bandra East Mumbai - 400 051

022-26571128 - 32

[email protected]

Regional Office – South

Mitra Towers #10/4 Kasturba Road Bangalore - 560 001

080-4150 4000080-4150 4111

[email protected]

IN HYDERABAD:

16-11-741-C/2BNANDINI COMPLEX, DILSUKHNAGAR500036PH: 040-24040019AMRUTHA MALL, RAJ BHAVAN ROADBEGUMPET, PANJAGUTTA500016PH: 040- 23325056 55611424


mailto:[email protected]







2, UPPER GROUND FLOORMETHODIST COMPLEX, ABIDS500001PH: 040-55513580PRASADS, OFF. N.T.R.GARDENSL.I.C.DIVISION P.O.500063PH: 040-23450228103&104, ALLURI TRADE CENTRENEAR KPHB COLONY, KUKATPALLY500 072PH: 23062744/ 23060654LIBERTY PLAZA3-6-365, BASHEERBAGH500029PH: 040-23220107SHOP NO 4, CITY CENTRE MALLBANJARA HILLS500 072PH: 040-666118882-85,Chandanagar,500050040- 23030307/66139139MBR PLAZA,(NEXT TO LEVIS),DR.A.S.RAO NAGAR,040-42213362DOOR NO.3-10-6,CG GOPAL RAO COLONY,TIRUMALGHERI MAIN ROAD,KARKHANA,500015

Marketing Implementations:

Marketing plan basically implemented on the basis of market segmentation .

We have gone through the target market segment which basically include

High income class




Middle income class Lower income class

The marketing mix is the part of marketing strategies ,which help to the company to match the needs of the consumer as well as the need of company, because we know that “MARKETING IS THE SOCITAL PROCESS WHICH HELP IN FULLFILLMENT OF THE NEED ,DEMAND OF THE CONSUMER AT A PROFIT”.

Implementation is an integral part of strategy. It make sense when it is implemented into Indian jewellery market it saw an opportunity for an organized sector. The customer was moving towards branded goods in other segments. Titan did the process of creating brands in the minds of customer.

Budget and control:

It is very important to make a control on Budget to reduce the operating cost which we can reduce to certain amount by the following ways.

Retailing:

Titan bring in the concept of retailing into the watch market ,which will really help in making the Direct relation with customer. This will help in reducing the cost of intermediaries.

Advertisements cost:

As for reducing the cost of companies we can take advertisement into consideration. We can reduce the TV ads cost by reducing the duration of advertisement.




Source of information’s:

www.titanwold.com www.tata.com/titan www.google.com www.indianfoline.com www.thehindu.com www.economictimes.com

BOOKS REFERED

MARKETING MANAGEMENT – PHILIP KOTLER


http://www.economictimes.com/

http://www.thehindu.com/

http://www.indianfoline.com/

http://www.google.com/

http://www.tata.com/titan

http://www.titanwold.com/


Marketing Plan for Titan Industry

Documents

market share

rural market

business company

diverse market

organized market

foreign market

company dont

indian watch market