Business Day (Johannesburg)

South Africa: India's Titan Has Colossal Job to Sell Watches

Johannesburg — IN THE consumer goods trade brands are titanic. They are big and they are strong. Sales ride high on them and sales fall when a brand stumbles.

To enter a new market without an established brand, then, may seem like bravery in the extreme, but that is what Indian watchmaker Titan will do when it starts selling in SA in September.

Titan Industries, part of the Tata Group, dominates India's watch market, selling 11-million timepieces a year in an annual market of 45-million. Reporting first-quarter results yesterday, the company said net profit jumped to 813-million rupees from 460,4-million rupees in the same period a year ago.

Titan is an established brand, as are the others in the company's watch spectrum, which ranges from cheap mass-market pieces to its own Swiss-made brand.

When the company comes to SA, appearing in local stores in the pre-Christmas shopping months, it will offer a limited range of 150 different watches, mainly priced in the midmarket R800- R1500 range, taking on fashion labels such as Guess and Fossil.

Without the backing of an upmarket Swiss watch appeal, or a fashion brand, the unknown Titan will have to convince shoppers in a new market to buy it. It is not even as if India is known for watches. While China dominates watch exports by volume (with an average price of 2 a unit) and Switzerland by value (with an average value of 528), India does not even rank on an industry list of major exporters. Germany, with 11,1-million units, France (6,2-million units) and the US (5,2-million units) are ahead.

Still, Titan says it can do it.

"The brand name will be established once the product is successful, not the other way around," says Titan MD Bhaskar Bhat. "Branding is everything, but that is not the reason the consumer will buy our product in the first place. "

Titan faces an uphill battle.

"Their brand means nothing," says Jeremy Sampson, executive chairman of brand agency Interbrand Sampson Group. "(People) are not necessarily going to be lusting after Titan when can they lust after something else well known and which you can show off as you wear it. They're not going to say 'wow' about a Titan."

To create a brand around the watch will take two to three years, says Sandeep Sridhar, Titan's business development manager for new markets, who spent the weekend's Jewellex trade fair in Sandton talking to retailers.

"The consumer needs to see a fashionable face of our product, something that looks good, that (they are) proud to wear and that represents (their) ambitions and personality," he says.

Without the heritage of an old- money Swiss watch brand or the hip nature of a fashion label, the pitch it makes in existing promotional material may work here. Titan pushes a message of creating a new future -- which strikes a chord in a developing market.

Still, it is a risk to assume any brand will work in a new market, Mr Bhat says, citing the experience of other brands in India. "Footwear brands - the Nikes, Reeboks and Adidas - in India failed in the initial five to seven years because they thought they could simply export. It didn't work. It's a combination of styling, pricing and positioning."

The company has a separate range for SA. Women's watches, for example, have larger faces because South African women, like their European counterparts, prefer larger watch faces.

Within five years, Titan aims to have 100 000-150 000 sales, a profitable share of a category it estimates is 1,5-million in size, out of a total South African watch market of 9-million.

The first step will be to get the name known. Titan has had some exposure, having sponsored a 1996-97 cricket tournament in India between India, SA and Australia.

But exposure is not all, Mr Sampson says. "Awareness is only the beginning. It takes a long time before people get interested in adopting it," he says.

Titan's parent company has a stronger brand that could, ironically, benefit the watch maker.

"I think Tata has got a good name. They've had huge success. I wouldn't underestimate them. It will be very interesting to watch and see how they do it."


Copyright © 2010 Business Day. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica aggregates and indexes content from over 130 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.

Comments Post a comment