Marketing Plan for Titan Industry[1] New

TITAN INDUSTRIES-WATCHES MARKETING PLAN

By,

Nitisha Parkhi

MMS- 1ST yr

Div- B

Roll No- 84

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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 offer quality products in classical design with superior technology.

VISION & MISSION

Our-Vision:

To be a world-class, innovative and progressive organisation and to make India’s desirable

watches.

Our-Mission:

To create wealth for all our stakeholders by building highly successful businesses based on a

customer-centric approach, and to contribute to the community.

Today the company has model for every price 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.

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Introduction

When we talk about the “wristwatch brand”, remember the only Indian wristwatch market was shabby, very ordinary. 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 was only available in the West or in Japan at that point of time.

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Our Marketing Objective is:

to increase Market Share of the company by 5% in the coming year

The competitos 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:

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

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 Kaif .

The place can be taken into consideration, as it is need for the company to open some show rooms in the rural area and as the company have little market share in the foreign market, to expand the business company should launch its showroom all over the globe in the more numbers.

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Market share of the competitors in domestic market

HMT 19%

Maxima 13%

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 costs range 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 competitors, the company is still in the number one position in domestic market because of the weakness of the competitor. The company has become more reliable and more acceptable to the consumer because of its marketing mix. The company has adopted the new marketing innovation to improve the feature of the product timely.

Though the current financial environment is not in favor, the company is 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.

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Environmental analysis

A. The marketing environment.

Competitive Forces

Major Competitors

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

Domestic Level: HMT Maxima-quartz

International level: Espirt Swatch Citizen Tag heuer Seiko Cartier

Fashion Houses:

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Dkny Gucci Adidas Nike

Among all these competitors, Maxima-quartz and HMT are major players .The strengths and weaknesses 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.

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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.

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Economic forces

Economic landscape

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

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

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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:

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). These all steps help the Industries to get sustained in the market.

All the steps help the Titan industry to compete in the watch industry. The performance of this sector for last few years is:

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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* PBT (2005/06) * - Rs. 90 Crore

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

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

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

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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.

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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.

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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.

In India 70% of the sales in wristwatches come from the lower segment. So, Titan captures 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.

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Other than these there have few more strengths 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

B. 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.

C. 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.

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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.

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

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

IV. Marketing Objectives:

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

Company’s marketing objective is to increase its market share by 5% .

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.

Marketing Mix:

PRICE PRODUCT PROMOTION PLACE

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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

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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.

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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.

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

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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.

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Marketing Plan for Titan Industry[1] New

Documents

rural market

indian market

ioreign market

diverse market

organized market

titan industry

indian wristwatch market

indian watch market