Dissertation Project Interm Report Roll No 63 EPGDIB 2010 - 12

GAPs foray in Indian Kids wear market
Subject: Dissertation Project Interim Report- GAP Foray in Indian Kids wear market Roll No. 63 EPGDIB: 2010-12
CONTENTS
Executive Summary Need & Limitations of study Methodology Literature Review Indian Retail & Economy Boom Gap Launch in China - 2010 Indian Apparel Market - An Overview: GDP Contribution Market Size- Domestic & Export Market Growth Drivers Market Segments Apparel Retail Regulatory Scenario aims to study the entry Dissertation project FDI proposition of leading apparel brand GAP in the kids GST wear segment.
Kids Apparel Market Overview: Market Size & Growth Name: Market Segments S n i g d h a Roll No: 63 Growth DriversI B : 2 0 1 0 - 1 2 EPGD t i t u t e Mantra i g new entrants(Gap & Need Analysis) I n d i a n I n sSuccess o f F o r efor n T r a d e New Delhi, I Competition Landscapen d i a
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Launch Plan for Gap Kids (PENDING- FINAL SUBMISSION)

GAP- An Introduction Understanding the global brand & marketing strategy Indian Launch Plan- Basis Competition Landscape Brand Planning Product Positioning Planning Marketing Communication Visual Merchandising Loyalty Programs
Merchandise Planning Product Mix Price Mix Source of procurement Retail Planning Launch Markets (Test/Full Fledged Market Launch) Geographical Selection Distribution Plan Retail Regulations Retail Distribution Modeling
Executive Summary
Indias
Textile & Apparel industry (domestic + exports) is expected to grow from the current Rs 3,27,000 crores (US$ 70 Bn) to Rs 10,32,000 crores (US$ 220 Bn) by 2020. The Indian domestic Textile and Apparel market size in 2009 was Rs 2,18,570 crores (US$ 47 Bn) and is expected to grow @ 11% CAGR to reach Rs 6,56,000 crores (US$ 140 Bn) by 2020 Global Textile and Apparel trade is recovering after a slump during the economic recession in 2008-09, and is expected to reach US$ 1 Trillion by 2020 from the current US$ 510 Bn. The growth in trade is driven by increased outsourcing of western / developed countries towards lower cost countries in Asia.Indias exports have also recovered in 2009-10 following increased global demand and is currently worth Rs 1,10,450 crores (US$ 23.5 Bn). Domestic Apparel retail market was worth Rs 1,54,000 crores (US$33 Bn) in 2009 and is expected to reach Rs 4,70,000 crores (US$100 Bn) by 2020 Mens wear has the majority share of Apparel market currently (43%). However, womens wear is growing at a higher rate of 12% compared to mens (9%), boys wear (10%) and girls wear 11%). Due to high growth, womens wear share is expected to reach 43% in 2020 from the current 37% share. The main drivers of domestic growth are increasing population, increasing income levels, rapid urbanization, improving demographics, increased organized players and increasing penetration of retailers into smaller cities. In terms of financial returns, Apparel is the most attractive product category amongst retail product categories both in terms of Returns on Capital Employed and EBITDA. Garmenting
4 Subject: Dissertation Project Interim Report- GAP Foray in Indian Kids wear market Roll No. 63 EPGDIB: 2010-12
& Technical Textiles are the most attractive segments within the Apparel value chain in terms of ROA and EBITDA. High growth categories include Womens casual wear, Innerwear, Activewear, Kids wear, Womens Western wear, Plus Size Apparel, Lingerie, Workwear & Uniforms Marketing & Brand activities play a vital role as they have propelled the growth and would help increasing the industry size further.
Safe Harbour
Conclusion and recommendations made in this dissertation are a reflection of my personal views and estimates based on secondary data available. The future involves certain risks and uncertainties that could cause actual results to differ materially from the current views being expressed. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments. GAP brand has just been taken as a case in this project considering the aggressive plans of the company for international expansion. This has no connection directly or indirectly with the companys actual plan for Indian market.
Need for the study

Gap is 2nd largest specialty apparel retailer in the U.S. worth an estimated $14 billion. The easing of foreign ownership norms in the single-brand retail sector has opened the floodgates for international brands keen to mark their presence in India. American clothing giant Gap (and the likes) has been on scouting missions to the country and is reportedly in the final stage of fine-tuning their entry strategy into one of the worlds most lucrative markets.
India is not a new market for the retailer as it serves as a strong sourcing destination for GAP through tie-ups with multiple garment exporters in India , (including Bombay Rayon Fashions, Gokaldas Images and Orient Craft)and the Indian subcontinent. As per reports, GAP is likely to adopt more of a premium strategy in India, slightly above the brands' positioning in the US. The company could stand to gain on profitability if it leverages this sourcing base for an India foray. The kids wear segment has been chosen keeping in view the untapped potential in this segment both from domestic as well as foreign players. This segment as we see still stands at its nascent stages in India as far as branded apparel are concerned.
Limitations of Study:
Though best of the efforts have been made to provide the best possible information in this project, but few, specific limitations in this research which should be addressed as a means for improvement or potential strategies for further study. The first limitation focuses on the ground truth data acquired for accuracy assessment. Though the project has been done basis the current market scenario and GAP Brand positioning, but still there might be few gaps. Hence the primary research to figure out the actual brand equity for GAP in Indian market would substantiate the facts said in the research. The second limitation of this project is that, the complete market understanding is based on the secondary research and literature review.
Methodology
This dissertation project aims to study the entry proposition of GAP in the kids wear segment. As the subject is really wide and needs both secondary and primary research t actually measure the exact market reality , potential and way forward, but for academic purpose this project has been done primarily using the below mentioned tools:
Secondary research on data available to understand market dynamics. Primary research on understanding the retail formats for existing brands Understanding the GAP brand business dynamics through the case studies.
Literature Review
Indian Retail & Economy- The Booming Way India is an important market for foreign retailers due to the dramatic social and economic changes in recent years. India ranks within the top five countries in the retail apparel index when considering market size, growth prospects, consumer affluence and readiness (Kearney, 2010). The Indian economy is flourishing with an average GDP Per Capita growth rate of 4.8% between 1997 and 2009 (UNICEF) and is expected to be the worlds third largest economy after the United States and China by 2050 ( Dadush and Stancil,). In 2006, relaxed versions of Foreign Direct Investment (FDI) policies were introduced in the retail sector, allowing joint ventures with up to 51% ownership in retail trade of single brand products (DOC, 2006). Despite the current FDI restrictions for multi-brand retailers, the thriving growth rate of the Indian retail industry and a large consumer base with increasing buying power provides great market potential for foreign retailers. Apparel is the fastest growing segment in the organized retail sector, with highest number of domestic and foreign brands in the market and increasing consumer willingness to pay for brand and quality ( Datamonitor, 2009). With the government acting as a catalyst, the Indian retail industry is in a highly dynamic state. The rapidly changing retail landscape in India demands a systematic and in-depth analysis of the current status of the industry and emerging forces that affect the competitiveness of the industry. Furthermore, significant differences exist in the strength of competitive forces between the organized sectors and unorganized sectors in the Indian retail industry,
demanding a careful analysis of each sector to provide a more accurate and holistic understanding of the industry structure. (Porter 2008) The Porters five force model provides a baseline for evaluating retailers (foreign retailers) strength and weakness as to where it stands in terms of consumers, suppliers, entrants, rivals, and substitutes .This study pertains to the cumulative effect of the five forces which determine the profitability of the incumbent and emerging firms in the industry. When existing firms achieve significant scale economies, it becomes difficult for new entrants to be competitive. Porter (2008) outlines two types of scale economies that can act as barrier to entry: supply-side and demand-side scale. Demand-side scale benefits, also referred to as network effects, arise with the increase in customer willingness to pay for the products. Buyers tend to trust larger firms due to their large customer base, preferring to be part of a large network of customers (Porter, 2008). Demand-side scale benefits discourage new entrants by lowering customer willingness to buy from newcomers in a market and by lowering the price new firms can command until they can develop a large network of customers (Porter, 2008). Large domestic retailers in India may enjoy network effects due to their early presence in the market, established customer base, and depth of knowledge of the Indian consumers. These large domestic retailers have safeguarded their position in the increasingly competitive market by aggressively expanding their geographic presence (IBEF, 2008) or by building relationships with foreign brands to identify niche segments for further expansion (Nuvo, 2007). Thus, foreign retailers may enter the market on a large scale or penetrate the market by marketing the uniqueness of western products and the emotional or symbolic value of foreign brands (Kumar et al., 2008). The primary distribution channel for apparel retailers is retail space in the form of specialty stores, department stores, or shopping malls. While all of these formats are present in India, mall space has grown rapidly in big cities (Batra and Niehm, 2009). Significant investments are being made for further development of malls across metros and high growth cities, including Ahmedabad, Chandigarh, and Surat. To meet fast growing demand for global luxury brands among Indian consumers (Narayan, 2006), many projects are in the pipeline to
attract more foreign many projects are in the pipeline to attract more foreign brands. Before 1997, there was no regulation on, FDI Therefore, foreign companies (e.g., Adidas, Benetton, Levis, and Reebok) could operate in the Indian market via high control entry modes such as joint ventures or wholly owned subsidiaries. The most prominent cost disadvantage for foreign retailers in India relates to retail locations and local experience. Large domestic retailers in the organized sectors are making the most of the retailing boom in the Indian market. They are investing in real estate to secure prime retail locations or achieve an early movers advantage (IBEF, 2008). Moreover, domestic retailers have gained incumbency advantages due to their better understanding and cumulative experience of serving the ulturally and geographically diverse Indian market (Sternquist and Gupta, 2007). Cultural diversity is a critical entry barrier for foreign retailers. India is an important market for foreign retailers due to the dramatic social and economic changes in recent years. India ranks within the top five countries in the retail apparel index when considering market size, growth prospects, consumer affluence and readiness (Kearney, 2010). GAP Launch in China The launch of GAP brand (kids wear) in the Indian retail market is preceded by an extensive market research in Indian market (and also the likes-eg China Market). The literature of market research is yet not published and as per the company policy is confidential. Therefore, the entry proposition is based on the Indian market study and a review of GAP brand launch in China market. The reason essentially being that China and India being both emerging markets and their market growth/dynamics similarities .The entry strategy in China is therefore, taken as one of the cues to frame the entry of GAP in the Indian market.
The year 2010 saw the opening for 4 GAP stores in Shanghai and Beijing (2012-total 8 stores) with three in GAPs larger flagship format while they have also started selling clothes online to Chinese customers. However, long before setting up its retail operations in china, Gap had much of its clothing manufactured in China. Gap is marketing goods ranging from children to adults, while placing most of its emphasis on consumers in their mid- to late 20s. Prices in the China stores have been comparable to those in the United States, meaning Gaps initial strategy does not seem aimed at charging premiums. Still, in a country with a per capita income that is far below that in the United States, Gap is positioned as a premium brand in china. But entering the mainland market proved a challenge, not least because in the fast-changing market, where consumers are faced with extensive choices of local and international brands, building brand loyalty is difficult. One of the major problems Gap faced prior to its China launch was low brand awareness in the country around 30 per cent compared to up to 98 per cent brand awareness in the US. The challenge for Gap China was not only to make the brand relevant for local consumers, but to also promote the cultural and heritage elements that are the essence of the Gap brand story. This had to be reflected in everything product, pricing strategy and marketing. Also as per the country retail experts, Chinas consumer market is still in the early stages of development, with consumption in smaller cities lagging far behind larger ones. National distribution is complex; marketing and television advertising is largely local; pricing is fiercely competitive; and counterfeiting is widespread. Additionally, GAP had entered China at a time when a plethora of other brands were also entering the country, so lot of money was to be put behind marketing the brand. The result was an extensive marketing campaign Lets Gap Together .It resisted the traditional way of doing fashion campaigns and about breaking boundaries of two different cultures by finding that common ground expressed by unique personalities sharing their individual way of freedom and passion. Presently, about 60%- 70% of the clothing that are sold by Gap stores in China differs from that in the US whereas the rest is domestically produced to suit the style and preferences of the locals in the country
(this reinforces the willingness to buy a foreign brand in a nondomestic market). The Chinese government had been backing the willingness to buy by enhancing the spending spree of its market by raising salaries and encourage more consumption as part of its longterm plan to restructure the economy and create more balanced and sustainable growth (this reinforces the able to buy clause of a foreign brand in a non -domestic market). Redmond Yeung, President of Gap Greater China as reported in the Financial Times said that there are a lot more high fashion products here than in the US because young people here spend 30% to 40% of their income on apparel. This figure is about 8% when compared to that in the US. Excitingly, this trend is driven by rising affluence, changing tastes and cultural factors. The retailers focus was primarily on GapKids and babyGap products because of the traditional Chinese emphasis on the family.
Indian Apparel Market An Overview

The Indian Apparel marketthe size and growth metrics- as we know are one of the most sought after and most worked upon areas in the Indian Retail Industry. The Indian apparel market is undoubtedly in the throes of change. Rapid growth and rising urbanization have spawned a new class of consumers with more money to spend, and a growing passion for fashion.
GDP Contribution- Textile & Apparel Industry It is undoubtedly, one of the leading contributors to the Indian GDP, by contributing close to 11% to the total GDP. Textile & Apparel Industry- A Glance
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With the apparel Industry (Domestic + Exports) growing at a throbbing pace in 2010 with total revenue of Rs. 3.27 lac crore ($70 Billion) and expected to reach Rs. 10.32 lac crore ( $220 Billion) by 2020. The Indian domestic textile & apparel market size in 2010 was Rs. 2.18 lac crore ($ 47 billion) and is expected to grow at 11% CAGR to reach Rs. 6.56 lac crore ($ 140 billion) by 2020. Out of this 71% - Rs. 1.54 Lac 11% CAGR crore ($33 Billion) is contributed by the Indian apparel segment. This segment is the lead driver as it is growing by nearly 11% is expected to be Rs. 4.70 Lc crore ($100 Billion) by 2020.
% age denotes Share of Apparels in the total domestic textile & apparel market
Hence, this shows that Indian Apparel market can potentially grow at 11% CAGR, primarily driven by high unit value growth i.e. the organized/ branded retail segment which is growing at a rate of 5%, other than increase in per capita consumption of clothing due to favourable consumer demographics.
The Growth Drivers

Apparel Retail - Segmental Glance:
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Subject: Dissertation Project Interim Report- GAP Foray in Indian Kids8wear market Rest of Next 62 Top Roll No. 63 Urban Cities Cities EPGDIB: 2010-12 41% 38% 21%
Currently Mens wear is the biggest segment of the market, however women & kids wear are growing faster than the mens segment with CAGR of 12% & 11 % respectively, and are expected to gain substantial share of the total pie
Apparel Retail- Regulatory Scenario:

The retail sector has not been conferred an industry status till now. Hence, there are no specific rules and regulations governing the sector. However, there are certain laws pertaining to the establishment of stores and conduct of activities, which retailers need to follow. The following are some of the legislations that regulate the sector: The Shop and Establishments Act The Standards of Weights and Measures Act The Provisions of the Contract Labor(Regulations and Abolition) Act The Income Tax Act The Customs Act The Companies Act Observers point out that the regulatory environment is not very conducive to the growth of organised modern retailing in India. In addition to the above laws: Retail companies have to follow certain regional rules and regulations on the basis of their stores location; different states have different laws to regulate the retail trade. Land conversion process is complex. Licensing is cumbersome. Taxes are different from state to state on goods movement. For example, some states levy entry tax; a few levy exit taxes; there is the central sales tax (CST) on inter-state sales and value added tax (VAT) on different products.
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Goods and Service Tax (GST)

GST, which is expected to be introduced in India with effect from April 1, 2011, aims to establish an economically efficient tax system that is neutral in its application, attractive in terms of distribution and removes the tax cascading prevalent in the existing system. Implementation of GST is expected to simplify the supply chain for consumer goods, make cash flow improvements by removing the excise duty on goods manufacturing, lower business input costs and enable enhanced profitability due to the elimination of tax cascading, etc. Key areas of retail apparel business influenced by GST: Production and distribution structure The abolition of Central Sales Tax (CST) is likely to warrant a revaluation of procurement and distribution arrangements. Removal of excise duty on products may result in cash flow improvements, since GST will be paid on sale/supply rather than on the product Pricing and profitability The elimination of tax cascading is expected to lower business input costs and improve profitability. The application of tax at all points in the supply chain is likely to require adjustments being made to profit margins, especially for distribution and retailers. Cash flow Tax refunds on goods purchased for resale implies a significant reduction in the inventory cost of distribution. Distributors are also expected to enjoy the cash flow from collection of GST in their sales, before remitting it to the government at the end of the tax-filing period. System changes and transition management Changes need to be made to accounting and IT systems to record transactions, in line with GST requirements. Appropriate measures need to be taken to ensure a smooth transition to the GST regime, for example, through
employee training, compliance under GST, customer education and inventory credit tracking.
FDI
The Government of India released a discussion paper on FDI in Multi-Brand Retail Trading for public comments. Currently, FDI in Multi-Brand retailing is prohibited in India while FDI in cash and carry wholesale trading is permitted, to the extent of 100 percent under the Automatic route and FDI in Single Brand Retailing permitted, to the extent of 51 percent under Prior Approval route and subject to the following conditions: Product to be sold should be of Single Brand Only. Products should be sold under the same brand internationally and Single brand product -retailing would cover only products which are branded during manufacturing. An FDI inflow of nearly $ 194 million (INR 900 crores) was received between April 2006 and March 2010, comprising 0.21 percent of the total FDI inflows during the period, under the category of single brand retailing. Between April 2000 to March 2010, FDI inflows of nearly $ 1.8 billion (INR 7,799 crore) were received in the cash & carry wholesale trading. This comprised 1.54% of the total FDI inflows received during the period.
Kids Market Overview:

Scanning through the streets of any town or city, one can see a mind boggling array of kids apparels. Spaghetti tops, Crystal studded denims, Italian cuts, Capris, and exclusive party wears. Kids fashion is a diminutive version of adults wear. They have all the clothing as like that of adults, and even much more. Children of today are much more intelligent than their previous generation. They like to have their own choice of clothing. This metamorphosis of children; becoming independent buyers is enhancing the kidswear market. Double income,
increase in the amount of disposable income, and one or two kids are the supporting factors to the growth of the kidswear market. Market for kids apparel is the fastest growing industry in India. Manufacturers are coming up with fancy materials targeting kids who are more interested in the upcoming fashion trends. Childrens garments are available in various forms and designs. Kids apparel market is more unorganized than any other segment of apparels. The market is a proposition of the good, bad and the ugly. A huge volume of kids apparel in India is being dominated by local and unorganized players. This gives an excellent opportunity for the organized players to lay a strong foundation in this segment. Indian market is now moving towards an international look in terms of childrens apparel. Cotton plays a major role in the clothing of children. Approximately, 86% of the kidswear are of cotton. Branded kids apparel market is in its nascent stage in India with a handful of national and international brands. Industry analyst estimate that market size of branded kidswear in India including brands like Planet Kids, Gini & Jony, Lilliput, Lil Tomatoes, and Weekender Kids is estimated to be around 20% of the total industry. They positively assert that branded market for kids is growing at 15% per annum. International brands including Barbie, Mothercare, Benetton Kids, Pepe, Lee Kids, Tommy Hilfiger, and Adams Kids have also entered the Indian market. Indian kidswear market during 2010 was estimated to be around Rs.33220 Crore, which was a small contribution of 19% of the total clothing industry. Indian Kidswear segment is considered by industry analysts as one of the fastest growing segment, due to increase in child population, supported by many other factors. This segment is expected to grow at a CAGR of 10%, Good times for the Indian kids apparel market are in the offing. The evolution in the buying behavior of children, and their influence over their parents results in a big difference in purchase decisions. Media exposures and promotions also cause a significant influence in the market. Evolving dynamics in this market have made it necessary for the manufacturers and retailers to evolve their business strategies in
order to sustain themselves in the market. Many manufacturers come up with their own brands, while some others enter into business through joint ventures. Todays kids are more fashion conscious, and are ready to experiment with clothing. Increase in the amount of disposable income, and retail blitz has brought a sea change in the Indian kids apparel market. With kidswear being considered as a part of the lifestyle segment and a strong emphasis is being placed on brands, this segment proves to be a potential business. Branded kidswear are well established in I tier cities, and are now experiencing a good growth in II & III tier cities as well. Wanting the best outfit for their children, parents are seeking a variety of garments offered by new brands, and are shopping in exclusive outlets dedicated for childrens apparel. Industry players further predict that the market is set to grow by 12% annually and would double in size by 2020 to 91000 Crores.
Kids Apparel Market Segments

Organized kids apparel market can be classified in various segments basis: Age Group Gender Quality & Price Clothing Category
The market, well dispersed and fragmented on considerations of quality and price may be classified under three broad categories.
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The low end market: Lower and economy (marginally improved product segment in relation to the lower category), solely volume driven, products are mostly unbranded and dominated by large number of manufacturers. The manufacturers operating in these segments are beset with problems of high competition, limited capacities, inadequate logistics and paucity of funds. Essentially the manufacturers are regional or even local players. The mid-range market: This segment features medium range of products, though primarily volume driven, caters to diverse sections of Indian consumers across all regions, Its quality is by and large acceptable to all sections. Majority of manufacturers, large and medium, have products on offer for these categories of consumers. The high end market: MNCs and large Indian players operate in the premium and super- premium product categories. Exclusivity in product features such as high quality raw materials, embellishments, design developments and above all branding of products for years make the products very special. Elitist categories of consumers pay for the products on demand.
Childrens wear is mainly on a seasonal basis. Highest sales figures are usually recorded during the months of August September. The average annual expenditure on kidswear is approximately Rs. 3, 857. For childrens wear, cotton is the most preferred material due to its non-allergic, comfortable, and easy caring virtues. But with the advent of more and more fads emerging in the market, this fibre faces competition with other synthetic ones, which are preferred for its washability, and non-creasing abilities.
% age denotes CAGR by 2020 for each of the product categories % age denotes CAGR by 2020 for each of the product categories
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Kids Apparels- the Growth Drivers:

Demography: The favourable demographics play a vital role in driving kidswear demand. With 18 Million new births every year in the country and nearly two-thirds of the population under 35 years of age, consumption demand is expected to rise, eventually trickling down to a spurt in kidswear demand ( premium & super premium segment). A survey states that, the maximum sales in childrens wear market comes from smaller towns. Patiala, Bhatinda, Coimbatore, Phagwara, and Sonepat are a few to name. Branded wears are well established in tier I cities and are now emerging into the II tier and III tier cities as well. In I tier cities, boutiques are emerging to be a popular trend. Consumers expect these retailers to have a cutting-edge of garments, and exclusive collection of clothes. Generally stores that offer a wide range of selection at discounts and low prices attract more traffic. As kids grow quickly, and are less attentive in keeping their clothes safe, parents consider kids apparel as functional and disposable as well. In case of infant, and toddler wears, general merchandise, and supermarkets dominate the sales. Specialty stores are successful in this segment as they are focused on a particular section in the apparel segment. Few retailers dominate the kids apparel market in any one particular area. Untapped market potential: With a promising future for kids apparels, the market has attracted international brands into India. Global brands like Mothercare, Mona Lisa, Benetton, Espirit, Bossini, and Kans have entered the Indian kids apparel market. While international brands eye Indian kidswear market, domestic brands like Lilliput, Lil Tomatoes, and Catmoss are
gearing up to have a share in the global market. Representing Indian brands abroad, higher profit margins, and succulent opportunities are assumed to be the reasons behind their foreign march. Media Proliferation: A brand; positioning itself in the market, depends on the level of differentiation it is able to establish. The manufacturer must also ascertain a sizable amount of promotional budget to gain eyeballs. There are no boundaries for the scope of merchandising activities for kidswear. With the effective publicity of mediums like TV channels, video games, blockbuster of superheroes, and peer influence, children are aware of the latest fashion in apparels, and other accessories. Generally parents like to dress their children like themselves. They further seek to buy brands they are already aware of, and have confidence in. Popular brands like Gap, Diesel, and many others plan to extend into this segment. With the emergence of many TV channels, promotional strategies of companies have become more intense. Innovative promotions which encourage the kids involvement, finds more acceptance. Rising Per capita Incomes: The kidswear market, like the top-wear segment is also another apparel area hat indicates that consumers have been upgrading from the mass and economy ranges to the medium & premium ranges. The demand of kidswear is directly proportional to the level of disposable income. A large number of households are getting added to consuming class with growth in income levels. The same is supported by the study done by NCAER, wherein households in the income bracket of more than Rs.5Lcs have doubled in 2010.
Success Mantra for New Entrants:

Lucrative Kids apparel market is not only increasing competition among the existing players, but also forcing the new entrants to plan big. Craving for a niche, new entrants as well as existing players follow distinct strategies to market their brand. Hence distribution, retail presence, quality, and the right product mix have become the hygiene factors for any brand. Brand Marketing and creating the TOM recall among TG. These would determine the success of the manufacturer in this segment. Brand Building: As apparel markets are growing in size rapidly, kids of today have a vast range of options to choose from. So, it becomes necessary for the manufacturers, and retailers to woo the offsprings and convince them to make the buying decision. Brands approach kids to market their product focusing on unique colors, silhouettes and prints just as for adults. Specialty shops are now an emerging trend for kidswear. Every brand tries to create a discrete brand identity through its merchandise and in-store arrangements. Raymonds brand Zapp has an exclusive kids loyalty programme. Reebok has a Made to Play campaign. They have specific sports wears like Cricket, Football, and Basketball collections. This is done keeping in mind that kids are more attracted towards playing. Peter England has set up a customized space for kids. Visual Merchandising: Trends have changed, and it is quite visible. Children, who were taken to parks and zoos before, are now coming along with their parents for buying their own clothes. So, the retailers who want to take a pie of the cherry should focus on attracting the attention of children along with their parents. They can thereby Capture the childs mind and the parents wallet. Kids exhibit considerable pester power while shopping for their clothes. Good store presentation and product merchandising is like a good book that has an attractive cover, and an interesting first chapter that would lure the viewer. Big departmental stores have segregated their apparel categories like infant wear, ethnic wear, casual wear and
preteen wear etc. They store a wide assortment of apparels and distinguish them with each other. Some retailers and department stores have taken the lead in creating an in-store arrangement with play areas, and kids oriented promotions within the store. Ex: Back to School promotion by Lifestyle. Pricing: Kids apparel market is no more a price sensitive segment. Higher input costs add to the prices of the apparels. With the increase in the purchasing power of parents, it is expected that they will sustain the business in the long run. As kids have the tendency to grow up very quickly, new offerings are required. This raises two concerns one of range, and second of pricing. An effective combination of both determines the future of the brand. Fashion Innovations: The practice of dressing girls with a frock and boys with shorts are way beyond. New pattern of garments in par with the latest fad is being sought by parents. Fashion industry is boosting up the well dressed child trend with their new collections on the runways frequently. Kids apparel manufacturers make optimum utilization of latest trends in the fashion world to entice the kids and increase their sales. With wishes and demands getting added in the list of kids, manufacturers and retailers are making the most of it. Factions of domestic and international players are seen in the arena, with each of them wanting a slice in the pie. Use of cartoon characters in kids garments: Apparel manufacturers are cashing on the popularity of cartoon characters. Character inspired merchandising is emerging as one of the hottest market trends. Mickey Mouse, Powerpuff girls, Spiderman, Superman etc. have all found their way into the kidswear market and are currently selling like hot cakes in the market. The type of cartoon character used in the apparel depends mainly on the popularity of the toon, their age group, and sex of the children.
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Coordinated Accessories: This seasons style statement includes dressing up with accessories, where everything from dress, bag, and hair clip is color, and design coordinated. In the current trend, leather bags, caps, key chains, and hair bands are considered as required with an ensemble. Especially in case of branded apparels, garments coordinated with proper accessories sell well in the market, than individual apparels. The price ranges for such apparels are extravagant.
Competition Landscape: Last few years Indian apparel kid market has seen a sea change in terms of National & International brands entering the market. This has propelled growth in this sector by activating a lot of Retail & Marketing activities in this segment. In attempt to create niche for themselves Indian kids apparel brands are changing the face of entire kids apparel industry. The brands dominate the kidswear market in India and have earned consumer confidence trust and loyalty towards the brands, thus earning laurels from its consumers. Currently the Indian brands are leading the show, with no international brand being able to make a mark in the industry. Lilliput is the largest player with an estimated market share of 14.3 per cent, followed by Gini & Jony with 11 per cent and Catmoss with 7 per cent.
International Players
Domestic Players
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Dissertation Project Interm Report Roll No 63 EPGDIB 2010 - 12

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Dissertation Project Interm Report Roll No 63 EPGDIB 2010 - 12

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Format Tersedia

GAPs foray in Indian Kids wear market

Launch Plan for Gap Kids (PENDING- FINAL SUBMISSION)

Need for the study

Indian Apparel Market An Overview

The Growth Drivers

Apparel Retail- Regulatory Scenario:

Goods and Service Tax (GST)

Kids Market Overview:

Kids Apparel Market Segments

Kids Apparels- the Growth Drivers:

Success Mantra for New Entrants:

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