Brand Project on Tanishq

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					SPECIAL-FEATURE                                                                          IMAGES RETAIL MARCH 2004


A world of opportunities for           IFF Fashion Vision Conclave 2004            and the industry.
brands, realtors and retailers –
                                       opened with the keynote address on          “Industry structure
that's what finally emerged out of
the seminars, discussions and          “India Shining”, delivered by B.S.          determines market
displays at the event-packed           Nagesh, the                                 strategy: Titan is a
Images Fashion Forum 2004, held        charismatic                                 Designer-
on February 11-13 at Ashoka            CEO of                                      Manufacturer-
Hotel, New Delhi. The mood of the      India's first                               Retailer brand
delegates said it all. Some 2,000
head honchos from across the
                                       organised                                   while Tanishq is a
globe converged there to ponder        retail chain,                               Retail brand. So,           Bhaskar Bhatt
upon, and prepare the roadmap          Shoppers'                                   Titan will have a
for the future of retail in India.     Stop. He                                    Marketing strategy, while Tanishq will
They were all there – the masters      reiterated                                  have a Business strategy,” he explained.
and visionaries of varied and                                       B.S. Nagesh
                                       the need to
allied fields like fashion, design &                                               Retailing, Bhat said, is at the core of
architecture, visual                   restore ethical practices in retail,
                                                                                   the organisation, as Titan Industries
merchandising, retail support          increase services and manpower, adopt
                                                                                   has in place powerful listening posts
systems & promotion, and real          a joint approach with the government
estate – exploring the contours of                                                 that cut through the trade clutter to
                                       to introduce legislation, and for
a country that is likely to emerge                                                 listen to the customer. Tanishq entered
                                       retailers to deliver services and
as one of the largest consumer                                                     an industry segment that was
markets in the world by the end
                                       merchandise as per the needs of
                                                                                   dominated by traditional jewellers,
of this decade.                        customers. Nagesh also talked about
                                                                                   with no branded players. The
The coming together of Lycra®          the need for Indian retailing to go
                                                                                   immediate task at hand was to shift
Rendez-Vous and KSA Retail             global so that Indian consumers shop
                                                                                   from “investment” space to
Summit with IFF enabled many           more in India, rather than being the
delegates from both retail and                                                     “adornment” space, and to create
                                       “largest spenders in Australia or
fashion arenas to participate in a                                                 awareness of fraudulent market
more time -and cost-effective                                                      practices. For this, the chosen route
manner. While LYCRA®, the global       THE RETAIL CHALLENGE                        was to have in place Tanishq's own
fashion brand, complemented IFF                                                    retail chain.
from the forefront, the event had      Bhaskar Bhat, managing director,
the support of prominent names         Titan Industries, had some interesting      Thus, the business philosophy
like Liberty, Safexpress, ICICI,                                                   formulated for Tanishq was that
                                       tips for brands and retailers in terms of
Tencel, Crossriver Mall, Titan,
Tanishq, NDTV and Outlook. With        managing the brand as well as channel       “Retail space can showcase products
                                       conflicts both within the organisation      far more brilliantly than advertising
IMAGES RETAIL MARCH 2004                                                                          SPECIAL-FEATURE

ever can.” Bhat elucidated, “We                                   all the difference in    global everyday,” he said, and there is
understand that retail can make the                               an industry where        bound to be a “fusion of sorts”
magic of brands come alive, because                               change lies at the       between modernity and tradition, and
retail can deliver the brand value                                very core. He went       between exclusivity and value.
proposition to consumers in a                                     on to explain these
compelling, yet cost-effective,                                                            For meeting the rising demand from
                                                                  fundamentals by
manner.”                                                                                   consumers in the mid-segment and
                                                                  delineating three
                                                                                           below, there is a “huge potential” to be
In order to make retail a key element                             key harbingers of
                                                                                           tapped. Opining that “Players are
of the brand, Bhat believes it is            Darshan Mehta
                                                                  change: the
                                                                                           there, but not enough,” Sitaraman
necessary to:                                                     imposition of excise
                                                                                           said, “Hypermarkets will become a
                                              duty in 2001; the price initiatives and
•   Showcase the product brilliantly                                                       huge driver of this category of business
                                              the resultant price war that prominent
    and seduce the customer with the                                                       in future. Going in for brands will
                                              national brands engendered by going
    magic of it;                                                                           become a way of life, whichever
                                              in for market share as strategy; and the
                                                                                           segment you are in, and the marketing
•   Surround the customer with an             emergence of new categories of retail.
                                                                                           of fashion will reach phenomenal
    environment that evokes the brand         “In fact, department stores have
                                                                                           heights, with considerable competition
    proposition; and                          brought in another permutation to
                                                                                           building up. In my opinion, organised
                                              the retail scenario by helping private
•   Speak to customers about the                                                           retail has taken off now and this will
                                              labels create a niche for themselves,”
    brand and its relevant benefits.                                                       move fashion forward like never
                                              Mehta asserted.
In the case of Tanishq, the façade was       What kind of response do such
used to tell a brand story – for the first   changes demand? In Mehta's words: a           LEARNING BY EXPERIENCE –
time ever in the world of Indian             hard look at cost structure on a weekly       THE PANTALOON WAY
jewellery. For example, Tanishq              basis if needed (“there's no cost that is     India's retail
conveyed the brand proposition of            sacrosanct”); re-investing cost savings       wizard Kishore
“mysteries in seven-stone diamonds” in       back into building brand equity; and          Biyani had his
visuals powerful enough to draw              getting the “innovation matrix” right         entire team of
thousands of shoppers into the stores.       (huge innovation=huge premium).               divisional heads
Once inside, the customer was                Mehta emphasised that innovation is           from Pantaloon
disarmed by alluring store windows           the only thing that will make business        Retail (India)
and customised display units placed          profitable in the long run, and also          Ltd lined up at
around black Egyptian Pyramids –             that there is no such thing as “big” or       the dias of IFF
symbolising the theme of mystery.            “small” innovation.                           Fashion Vision
                                                                                           Conclave to                Kishore Biyani
Bhaskar Bhat summed it up pointedly:         Kumar Sitaraman, managing director,
“In retail, nothing stands still:            Lifestyle,                                    present the company's distinctively
Markets change, customers do not             reiterated the                                “Indian” style of functioning. “We
always respond in the way                    need for customer                             have a Knowledge Group because we
anticipated, and retailers must              feedback, saying                              make a lot of mistakes, record each of
therefore constantly monitor their           this could be                                 them, analyse them and rectify our
success... Today's hot idea is only as       done only by                                  working thereafter,” Biyani said.
good as next week's sales figures.”          research, which in                            Pantaloon had earlier opened large Big
                                             turn would help                               Bazaars, much on the Western
CHANGING WITH THE TIMES                      organisations                                 hypermarket model, and after
Darshan Mehta, president, Arvind             respond to                  Kumar Sitaraman
                                                                                           analysing the results, evolved a model
Brands, spoke of two classic business        customers' needs on time. Here, he            whereby a number of small bazaars
paradigms – the cohesion between             said, retail plays a vital role by enabling   Food Bazaar, Gold Bazaar, Shoe
“mind to market” and “time to                fast feedback and consumer research.          Bazaar, Fashion Bazaar were
market”. This, Mehta said, can make          “The world is shrinking, becoming             introduced within Big Bazaar. The
    SPECIAL-FEATURE                                                                              IMAGES RETAIL MARCH 2004

                     various divisional heads explained how a                 Also participating in the debate were Akhil
                     conscious attempt was made to mould to regional          Chaturvedi, director of Provogue, Neeta Narula,
                     tastes and requirements the store designs,               managing director of Ebony Retail Holdings,
                     merchandise, and even the loyalty and rewards            Krish Iyer, CEO of Piramyd and Hem Chandra
                     programmes.                                              Javeri, president of Madura Garments, while
                                                                              Chetan Shah, managing director of Pepe (India),
                     WILL PRIVATE LABELS KILL NATIONAL                        played it out as moderator.
   Adarsh Gupta      BRANDS?
                                                                              The high cost of sustaining retail operations
                     A highly informative debate between brand                means retailers are bound to put pressure on
                     professionals and retailers hovered around the           brands to increase retail margins. Professionals
                     topic of co-existence between established                from department stores said the initiative on
                     department stores and national brands. It was            private label was actually meant for achieving
                     pointed out that large department stores copy            higher margins, as an alternative to squeezing the
                     what sells, and introduce the same merchandise at        national brands.
                     a cheaper price under the store label. Brands,
                     therefore, are left with no choice but to focus on       Brand professionals, on the other hand, said the
    Neeta Narula                                                              cost squeeze driven by the retailers might lead to
                     their exclusive outlets and smaller MBOs.
                                                                              compromises on product quality, which would
                     Adarsh Gupta, executive director, Liberty, said,         ultimately kill their brands. The panel, however,
                     “To kill a national brand, we will need not just         was unanimous that retailers and brands need
                     one store brand, but hundreds of them. This is           partnerships rather than adversarial relationships,
                     because the share of chain-store business is             since private labels could themselves be a threat to
                     hardly 10 per cent in the total sale of a national       the national brands due to price advantage.
                     brand.” Gupta, however, assured that the share
  Akhil Chaturvedi
                     was growing rapidly.                                      Expert Speak: “Power Brands” can withstand
                     Three possible ways of dealing with this conflict         powerful “Store Brands”
                     of interests, according to Gupta, are:                    All brands are not equal. “Power” brands, which
                     •   Brands allow extra margin from their                  command strong customer loyalty, are at lower risk
                         manufacturing margin by cutting down the              from store brands, vis-à-vis the multitude of
                         supply-chain cost and improving                       wannabe national brands that are largely
                         efficiencies;                                         undifferentiated from each other.
                                                                               Also, brands that successfully create a
                     •   Brands increase MRP percentage for all                lifestyle/image appeal are less susceptible to
     Chetan shah
                         retailers, which, though, carries the danger of       competition from store brands, than those whose
                         the brand getting discounted by street                appeal is only product-led, since product
                         retailers, a higher incidence of government           differentiation can be sustained only by highly
                         taxes, and resistance from customers; and             innovative brands over the long term.
                     •   Brands develop special line for chain-store           Private labels gain share by offering products at
                         requirement.                                          better (not cheap) prices. They thus benefit from the
                     “Brands express and reinforce certain values and          customer making tangible product and price
Hem Chandra Javeri
                     opinions that the customer has. But in an                 comparisons with national brands in the store. Only
                     environment where the customer's needs are                when “national brands” deliver the
                     constantly in a state of flux, like it is happening in    intangible/emotional benefits along with tangible
                                                                               attributes, will they be able to sustain themselves
                     India at the moment, deciding on a branding
                                                                               against store brands.
                     strategy can become a real mind-boggling issue,”
                     conceded Gupta.                                                       -- Vivek Mathur, director, Integrated Retail
 Krish Iyer                                                                                                  Management Consulting
IMAGES RETAIL MARCH 2004                                                                                                     SPECIAL-FEATURE

MALLING OF ARABIA                                             by the finest festival marketplaces in                  Design architecture,
                                                              the world.                                              according to
                         Phil McArthur,
                                                                                                                      McMullin, is the
                         director Dubai                       There was a lively panel discussion on
                                                                                                                      packaging of the
                         Festival City,                       “Learning for Developers of Indian
                                                                                                                      total product
                         gave an                              Shopping Centres and Malls”, in
                                                                                                                      experience “the
                         informative                          which some of the country’s leading
                                                                                                                      centre of gravity” in
                         presentation on                      builders like Ajay Chandra of Unitech,
                                                                                                                      a shopping mall.         Jeremy McMullin
                         “The Malling                         Rahul Saraf of Forum and Atul Ruia
                                                                                                                      People in a mall take in space at a very
                         of Arabia, the                       of Phoenix Mills shared their
                                                                                                                      subconscious level. It is important that
                         Market                               experience and views with the
        Phil Mc Arthur Perception and                                                                                 the space flows intuitively and
                                                              audience. Anuj Puri, MD of
                                                                                                                      consumers orient themselves
Market Creation”. Describing the                              Chesterton Meghraj moderated the
                                                                                                                      accordingly. Citing two case studies of
upcoming Dubailand, part of a huge                            session.
                                                                                                                      successful malls Nova America in
government project, he said, “It will be
                                                              In yet another panel discussion on                      Brazil and Oviedo Centro Commercial
the biggest, most varied leisure-
                                                              “Innovations - Key to Success”, Prem                    in Columbia he emphasised that
entertainment-shopping attraction on
                                                              Sadhwani of Tencel stressed the fact                    planning, marketing, design and
the planet.” It will feature seven
                                                              that for innovations to be a continuous                 tenant mix in a mall should all speak
themed “worlds” that together cover
                                                              contributor to the success of any                       the same language.
over 35,000 acres of built-up space.
Within Dubailand will be several                              company, it needs to have a focused
shopping centres, including Mall of                           product development team. “Product
                                                                                                                                         Magazine, MD
Arabia (7,000,000sq.ft), factory                              innovation is all about partnership,
                                                                                                                                         (South Asia) - CB
outlets, Auction World, World Trade                           from the fibre manufacturer to the
                                                                                                                                         Richard Ellis, who
Park, The Flea Market, and other                              retailer,” he said.                                                        moderated the
facilities.                                                   CHALLENGES FOR                                                             session, said that as
Speaking about his own project, the                           RENOVATION OF OLD STORES                                                   the competition
                                                                                                                       Anshuman Magazine increases in India,
Dubai Festival City, McArthur                                 Differentiation, according to Jeremy
explained with the aid of visuals how it                                                                                                 design would be one
                                                              McMullin of Design Corp, Canada, is                     of the key differentiators and would
is being developed on 1,600 acres of                          going to be the critical factor in any
prime downtown waterfront, with the                                                                                   need to be upgraded regularly to keep
                                                              shopping mall. So, how do you                           the interest alive.
project featuring splendid layout of                          differentiate? First, plan in a way so as
retail, residential and leisure facilities.                   to maximise investments and optimise                    R. Nagendra, regional manager
The crown jewel will be a 1.1 million                         work efficiencies. This is where design                 (Middle East)
sq.ft waterfront development inspired                         architecture comes into the picture.                    Ansorg, stressed
                                                                                                                      the importance of
                                                                                                                      the lighting
 Malls and shopping-centre developers had a lot more to celebrate as Kathleen Nelson, chairperson of ICSC
 (International Council of Shopping Centres), announced the appointment of Amitabh Taneja, convenor-IFF, as           element in the
 director, ICSC India-Operations. “The mission of ICSC in India will be to assist shopping-centre developers,         context of stores.
 retailers and investors to make their businesses more profitable and as per world standards,” she said.              The light
 Delivering her speech on “The Malling of India”Kathleen said there was much enthusiasm among global                  preference in
 retailers and retail estate developers about the prospects in India as ths country was currently witnessing
 hectic activity in the sector with over 200 malls ciming up in the next couple of years. “The ICSC feels this is     stores changes
 the opportune time to make a presence here so as to be part of this development process,” she said. Scott            from country to
                                                     Harris, ICSC Staff Vice-President (International), introduced                                R. Nagendra
                                                     Kathleen to the elite IFF audience.
                                                                                                                      country. For
                                                     A copy of the first-ever book on 'Retail Real Estate Malls in
                                                                                                                      instance, a store in the United
                                                     India', brought out by the IMAGES Group, was presented to        States/Europe will usually have subtle
                                                     Nelson. The book discusses the growth and development of         lighting, a concept that will not
                                                     malls in India, identifies key trends and issues, and profiles
                                                     operational and upcoming malls across the country.
                                                                                                                      necessarily be acceptable in the Middle
                                                                                                                      East/UAE, or even in India, where
 SPECIAL-FEATURE                                                                                               IMAGES RETAIL MARCH 2004

people are used to so much sunlight and the stores are                      capability, commitment to vertical control of fabrics,
preferred brighter. Each zone, he said, should be in                        in-house production capacity and quick decision-
harmony with the merchandise it houses and the                              making mechanisms.
specific emotions attached thereto. Also, the                               The case of Giordano, also known as “The Gap of
importance of providing the “right” illumination for                        Asia,” was presented by Ishwar Chugani, executive
“fitting rooms” was reiterated, as in most cases it                         director, Giordano (Middle East). Chugani traced the
remains neglected in India. Correct lighting influences
                                                                            brand's history, from its first unisex T-shirts to
the decision-making process of customers.
                                                                            technically-innovative products, including Dry-Tec
Ahsin Rashid, Development Design Group, U.S.,                               and Nano-Tal. He also pointed out that Giordano
talked about the imperative to create new visions for                       works with 60 days' inventory in the pipeline and            Ahsin Rasheed
the ever-changing market phenomena, as every trend                          dormant stock of less than 5 per cent. Even with basic
goes through a certain life-cycle. In the context of the                    merchandise, Giordano keeps its stores looking fresh,
mall phenomenon, he stated that the “next big thing”                        with visual merchandising changing every two weeks
would be “looking beyond the mall”, as is already                           and reallocation of merchandise across the chain
starting to happen in the United States.
                                                                            COMPETITION KNOWS NO BOUNDARIES
                                                                            Earlier, at a panel discussion with Robert Young
Zara of Spain and Giordano of Hong Kong two of
the most aspirational brands made a special                                 (chairman-RYA, Texas, USA) and Nicola Evoli on             Devangshu Dutta
appearance at IFF, with discussions on their brand                          “Designing an Interactive Store: Tips for Indian Stores
value and supply-chain management. In his study on                          and Brands”, Young reminded that competition was
Zara, part of the euro 4 billion Inditex Group, retail                      no longer confined to territorial boundaries.
and fashion industry consultant Devangshu Dutta                             Moreover, since it was not possible for all Indian
contrasted traditional seasonal cycles of several                           retailers to travel across the globe and learn about the
months with Zara's famed delivery-cycle of 15-30                            emerging retail concepts, it became necessary that
days. This is enabled by Zara's trend-spotting                              retailers took advice from consultants.
 6 LAKH SQ.FT MALL SPACE DEALS AT IFF                                       Ian Douglass Robertson Watt, chairman-designate of
 The introduction this year of L³ (Location, Location, Location), a         ICSC Retail Real Estate World Summit, gave a
 dedicated platform providing access to retail real-estate opportunities,   presentation on “ICSC India Initiative on the Malling        Ishwar Chugani
 attracted a large number of realtors and leading international property
 consultants (IPCs) including Chesterton Meghraj, Jones Lang LaSalle,       of India”. He surmised that “In a country with over
 CB Richard Ellis, ICS Broll, Cushman Wakefield and Colliers                one billion population, even if the top-10 per cent fall
 International. They used the forum to discuss lease deals with major       within the target consumer category of global retailers,
 retailers like Pantaloon, Shoppers' Stop and Lifestyle, and with brands
 like Mango, Pepe, Giny & Jony, Spykar, Weekender, Provogue and
                                                                            it is a bigger market than the whole of Europe put
 Liberty.                                                                   together. They cannot afford to stay away from this
 “Business discussed at IFF can be divided into three categories:           market for long.”
 transactions initiated, transactions progressed and transactions
 concluded. All put together, we are happy having discussed over 2.5        Different retail formats dominate the scene at                Robert Young
 lakh sq.ft of leasable space,” said Anuj Puri, MD, Chesterton Meghraj.     different points of time. Elaborating on this, Watt
 Although the NCR region was in focus, ready and upcoming mall space
 in Mumbai, Kolkata, Pune, Bangalore and Hyderabad were also
                                                                            pointed out: “There was a time when malls were the
 discussed. Similarly, the Jones Lang LaSalle India team discussed          dominant format. But today, the large hypermarket
 about one lakh sq.ft of retail space and concluded six deals, revealed     stores anchoring them are dictating these malls. The
 Pranay Sinha, associate director with JLL.
                                                                            challenge in retailing is in finding the right location
 Akhil Chaturvedi of Provogue finalised deals with Sigma in Bangalore
 and City Centre in Kolkata. Chetan Shah of Pepe held talks for four        and identifying what the people in that community
 locations in the North, with about 5,000 sq.ft space each in Delhi,        want, and then deliver exactly that.” Commenting on
 Gurgaon, Noida & Ludhiana. Adarsh Gupta, ED, Liberty, finalised with       the retailing capabilities of Indians, Watt said one
 Forum Kolkata. In all, Liberty will take up about 12 locations of 1,400-
 2,000 sq.ft.                                                               particular thing he noted was that “Indians are                   Ian Watt
                                                                            traders by default.”

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