Titan industries limited

Where we want to be????

 2009, More than a billion $
company
6000
5000+
5000
4000+
4000 3000+

3000 2136 Income in

i
Rs Crores
2000

1000

0
2007 2008 2009 2010
 The story up till now…
Registered a
profit of Rs 250
crores in 2009-
watches
10

Growth of 22.2 jewellery

% over the last
year
eyewear

539 company
owned retail Precision and engineering
stores with a
Rs. 4400 crore
turnover
The story up till now…

Watches (1987)
•Accounts for 60% of the watch
sold in Indian markets
•Awarded the most admired
time wear brand in India for the
9th consecutive year
•Sold 11 million units in 2009-10
• Rs. 1026.78 crores
•22% of company’s turnover
The story up till now…

Jewellery (1995)

•Tanishq – revolutionized
branded jewellery market
•Changed the jewellery buying
behavior
•Net profit of 42 lakh in 2009-
10,turnover of 3500 crores in 09
•Brings in 75% of titan’s revenue
The story up till now…

Eye wear (2007)

•Titan eye+ benchmarked worlds
best practices
•Sales of around 40-50 crore
over the previous years
•Only 5 % branded eyewear
market share out of which titan
eye+ is 2-2.5 % (1500-1800 crore
p.a.)
The story up till now…

P & ED (2002)
• leading automation solution
and precision parts provider
across industries
•Growth was slow in the first half
of 2009
•3-5% of company’s income
•Has clients from U.S. and
Europe
Watches- (70% mkt.
BCG matrix
Jewellery- (4% mkt.
share of organized
share
market
Market growth of
Market growth 15-
20-40%)
30%)
Eye wear- 2.5 % P & E divison- (mkt.
mkt. share share – 0.012 %
Market growth 15-Market growth 10-
20%) 20%)
TIL Products
 Watch market- perceptual mapping
Formal / Classic
Omega,Rado,
Longines
Raymond Weil
Tissot
Nebula
Sonata,
HMT,
Maxima XYLYS
Raga, TITAN edge Price
Rs 500 1000 2000 4000 5000 10000 30,000 +

Espirit, Swatch Fossil

Giordano, DKNY, Carrera
Fastrack Tommy Hilfiger Tag Heuer Hugo
Boss
C Dior
Fashion/Sporty
 Tanishq jewellery

After 5yrs

Growth of at
least 25 %

Current State(2009-10) Desired State(2014-15)

Turnover – Rs. 3500 crore Turnover – Rs. 10,000 crore
Market share -4% Market share – 30-35%
How?
 lion I n dians
i l 100 mi
20.4 m e group of llio
g
in the a rs are in the age n Indians in
group
12-19 y upper 21yrs
of 17-
or
Upper class
middle

5 years
e d d
d iin
n ggss
w d
Mo
M orree wehe lliin nee
w n t
t h e
do
d own ..
…
….. n
u m p
p ti
ti o
o n
n s u m
Go
G d cco
olld on s
up
u p
ggiift
s as
s a
a ft
h
c ee s a
Waattch
W
 THE EYEWEAR MARKET – AN
UNTAPPED OPPORTUNITY
Consumers change their glasses / frames once in 3 to 4 years on an average
Users: 84mn users – which is about 25% of those who need the correction
30% of population typically needs correction in vision ~ 300 mn
Incidence:

Market size:
• 25-35 million units per annum
• Rs 1500-1800 crs per annum
• Comparable to the watch industry
• Repeat purchase is a regular feature from adolescence to old age
Customer lifetime value is very high
• Almost everyone over 40 yrs needs correction

• Growth: Market has been growing in double digits ~ 15-20% per annum and likely to
sustain
• Demand drivers: Urbanization, literacy, Penetration of TV & computers, Poor eye health
due to lifestyles/ improper diet, etc.
• Margins: Overall mark ups of up to 300% exist between landed cost & retail price!
 P & E Division

Current position
Market Size
Rs 135,000 Cr. Market Size
Automotive Rs 575 Cr.

•Precision
components
Telecom
Automation
•Dash board Solutions
instruments
Aerospace
•Sub systems

Medical Domestic
Domestic &
International Market
Market. Only
Titan International
 International Market
• International sales - $25 million
• No.1 in Oman- 24% market share
• No.1 in Bahrain
• No.2 in West Asia- 18% market share
• No. 2 position in the Middle East.
• At the international level, Titan operates in the mid-premium
price segment category.
 International Brands
• Titan also brings India 2 international brands.
• Tommy Hilfiger Watches
Tommy Hilfiger, one of the best-known American fashion
brands, has its roots in Elmore, New York.
Titan Industries Limited has made Tommy Hilfiger Watches
available in India at most ‘World of Titan’ stores, leading
multi-brand watch outlets, and department stores like
Shoppers Stop, Central and Lifestyle.
• Hugo Boss Watches
Hugo Boss, one of the world’s most popular European brands,
has its roots in Germany. 
 Failure in Europe
• To cater the European taste, Titan roped in with European
designers.
• Introduced steel watches and set up a separate manufacturing
plant in India.
• Opened office in London and Paris.
• Hired an Advertising Agency in London
• Launched simultaneously in 11 markets of Europe.
• But failed make an impact, suffered huge losses, pulled out of
the market in 2002.
• Reason- couldn’t estimate the investments that would be
required.
 GCC
• Gulf Cooperation Council accounts for the 2/3 of the titan’s
international business
• Titan’s international strategy now is to focus only on watches
and only within Asia
• GCC market is estimated around 20 million-25 million
watches and growing at around 5 % annually.
• At present Titan has a low 3% to 4% share across the GCC
watch markets.
• Goal is to increase this to 10% especially in markets like
Dubai and Saudi Arabia over the next five years.
• To enable them to meet this target, their marketing budgets
has been tripled from 5% of net sales to 15%. 
 New strategy
• No longer targeting just the Indian population in the
GCC, but also the local residents of Emirates.
• Moving up the value chain from the mid- market
segment($40-$80). [now its is at mid premium segment
of $80-$200]
• Launching new collections
• Strengthening the advertising and the retail presence
• First building the adequate volumes and the business
must generate funds which in turn will fuel growth.
• Plans to spend Rs.1000 crores in 5 years
• Aimed to become the world’s third largest watch company.
• Looking to increase the retail presence from 295 stores to
325 by 2011.
• Also number of Fastrack stores to 100(24 now)
 Tanishq in international markets
• "Presently, Tanishq is present in seven countries with 55
outlets through the shop-n-shop concept
• The company is eyeing countries such as Vietnam,
Indonesia, Russia, Canada, and, CIS countries for exports.
• The objective behind the move is to tap the huge demand
opportunity for jewellery in the international markets
with an aim to garner a volume growth of 20 per cent in
the jewellery segment through exports, in the next two
to three years.
 Failure in US
• Entered into the US market in the year 2008.
• The brand's stores had a relaxing spa-like theme and the
jewellry collections carried names like Zen, Yoga and Gingko.
• But the economic downturn hit it badly.
• Titan Industries has incurred losses of about Rs 29.02 crore
from these two stores.
• When it compelled brand to look for investors and no one
was coming it had to close the only 2 shops in the year 2009.
After 5 years?????
Leader’s philosophy – Bhaskar Bhat (MD
watches and jewellery)

Invest in long term growth- even if it means a short –

term hit

Deliver high profitability and top- line growth without

using too much capital, ingrain economic value added
(EVA)

Will not enter any category of product in which

competition based on price and product quality
alone, enter segments where customer is under
served
 Dealers and retailers
• Penetration in Indian markets and diversification of portfolio by
spreading wings abroad
• Have over 10000 dealers across India
• Have 539 retail outlets in total
• Have over 300 world of Titan
• Over 100 Tanishq outlets

• Increase the dealer and retail store network by franchisee model in

the 5 years
• At least 150-200 retail stores to be added
 Rounded
off to the
Financials nearest

2009-10 2014-15
Parameters (in Rs. crores) (in Rs. Crores)

Total Income (overall growth assumed to be 25%) 4714 14,385

Total Income (overall growth assumed to be 20%) 4714 11,725

Watches sales ( growth assumed to be 15%) 1026 2008

Tanishq turnover ( growth assumed to be 25%) 3500 10681

Eyewear and P & E D ( culminated growth of 12%) 152 267

Expenditure in international market (company 1000 in 5 yrs.
sources)

Selling expense ( at 12 %) 358 631

Market penetration for
Tanishq, titan eye and P & ED
reqd.
International markets have to
be catered to by watches ,
jewellery and P & ED ,at
present 32 countries
Being am market leader in
branded segment of watches
and jewellery much required
Not Prepared
As most of the offerings still in
question mark of the BCG
matrix
 Trends

Gifting

accessory

Style statement
Product Development

Fashion Jewellery
‘Tarakshay’
 Product concept
• Everyone wants to be remembered ,everyone wants to leave
an everlasting and the best impression on others around.
Tarakshay - a range of fashion jewellery from the Titan,
offers spell binder designs in fashion jewellery that empowers
you with that magical touch which lets you captivate the
world forever.

• Enchanting Always!!!
 Why?

Rs. 15000 crore market and growing at a CAGR of 6-

10% from the year 2000 globally
India second largest manufacturer of imitation
jewellery
India one of the largest consumer, also great
opportunity in exports to US, UK, Europe, Canada,
Australia and other asian countries

Was one of those few industries which were not hit

by recession

Women looking for contemporary, stylish yet affordable accessories, mix and match
trend
Major consumers of fashion jewellery in
the world and the market trends
Segmentation and Targeting
geography
income

age
r the rs
Fo 5 y
xt
ne rom
f ch
n
lau
target

d
i dd le a n
M r class
uppe

Metros and
other tier- 1
cities Both male and
females
(15- 30 )yrs
 Positioning

For young Indians ,tarakshay is a jewellery brand that offers priceless fashion
jewellery

• Positioning Statement

Target market – middle and upper class males and females, 15-30 yrs in metros and
tier 1 cities
Benefits offered- priceless fashion jewellery
Price range- Rs. 300- 10000

• Value Proposition
 Channels of distribution

Company

Tarakshay

Retail channel POP display

Tarakshay small
Tanishq and Fast Internet
westside retail stores
track stores
 Financials for the product
•In jewellery the mark up Is around 100 % and even greater on
the internet
•Our jewellery would be in a price range of Rs. 300- 10,000
•Market in 5 yrs will be Rs. 15,000 crores from 1500 now
( growth assumed at 5%)
•We expect to gain at least 6-7% of the market by the end of 2015
i.e. a sales of Rs.1000 crores
•This should help us breakeven as we already have plant capacity
for jewellery making, some upscaling would be required
•Promotions, raw material procurement and store setup will be the
major expenses
 4 P’s
Product-Bracelet, brooch,
necklace, earrings, choker,
bangles, anklets, finger rings
Semi precious stones,
beads,ivory, lac, leather,
terracotta,plasticc, paper
Silver, copper, aluminium,
brass etc
Price- Skimming
Place- in metro cities and
other major cities like
Bangalore, Lucknow,
Hyderabad, Indore,
Ahemdabad, Nagpur, Pune,
Kanpur, Surat,
Exclusive retail stores in malls
Promotion- ‘spark the
looks’ campaign
Advertisement on TV, fashion
magazines
FM and billboards(only during
the campaign)
Brand ambassador-Young
celebrity -Sharman
joshi,Sonam Kapoor
 Challenges we can face
• Suppliers power is strong , due to shortage in certain raw
material i.e. semi precious stones
• Changing fashion trends and increased consciousness of the
consumers resulting in competition among the major
manufacturing nations
Product Development
Product life cycle
And
Strategies
 PRODUCT LIFE CYCLE

PRESENTLY: INTRODUCTION STAGE

AFTER 5 YEARS: GROWTH
 INTRODUCTION STAGE
As this is the introductory stage:
• The costs incurred would be high.
• Would start off with slow sales volumes
• There would be little or no competition
• Demand has to be created
• Customers have to be prompted to try the product

We would be in this stage for the “First two years”

 Action

Desire

Interest

Attention
 Strategies to be adopted in the
introduction stage….
Imagine, specify, plan, innovate……
• Start with teasers- create curiosity among the people

• Later, come up with an innovative AD on TV- Transform

“CURIOSITY” into “DESIRE TO BUY”

• POP- Set up a highly oriented distribution channel and make sure

the products are available at the right place and at the right time.

• Initially the products can be made available at the exclusive

TANISHQ & FASTRACK outlets, and the lifestyle stores where these
brands are already been sold.
 GROWTH STAGE
In this stage:
• The costs would reduce due to economies of scale
• Significant increase in the Sales volume
• Profitability will begin to rise
• Public awareness would increase
• Competition would begin to increase with a few new players
in establishing market
• Increased competition would lead to price decreases

This phase would be after the ‘Introduction Stage’

 Strategies to be adopted in the
growth stage….
Develop, test, analyze and validate…
• This is the appropriate timing to focus on increasing the market
share

• The company must show all the products offerings and try to
differentiate them from the competitors ones.

• A frequent modification process of the product is an effective

policy.

• Advertising should be oriented to the task of market leadership

and not in raising product awareness
 MATURITY STAGE
• Costs would be lowered as a result of production volumes
increasing and experience curve effects.
• Sales volume peaks and market saturation is reached
• Increase in competitors entering the market
• Prices would tend to drop

We would be in this stage at one point of time..

 Strategies to be adopted in the
Maturity stage….
Build, relocate, maintain and deliver…
• Emphasize on Brand differentiation and feature diversification to maintain or
increase the market share

• Extend the product’s life

• Change the Pricing and discount policies in relation to the competition policies

• Relocate promotion and advertising from the scope of “getting new customers”, to
the scope of “product differentiation in terms of quality and reliability”.

• Try to advance the distribution channel- “ No Customer Should Be Kept Waiting.”

FROM WHERE WE ARE, TO WHERE
WE WANT TO BE……

First 6 months After 3 years At the end of 5

years
Titan as a market leader – defensive
• Courage to attack oneself
• Strong competitive moves blocked
• Defend the turf and grow the market size
 Jineesh
Priyanka
Jeffin
Questions??
Sukriti
Sumith
Jose
Tileban
Prithvi
Arjun
Thank you
Prakash