Watch the style statement

Walking down the memory lane, I find it vivid and clear: when I stood first in the class-V examination, my dad gifted me a Titan’s latest quartz technology and international styling wrist watch. I was in seventh heaven.

Compare today with the past (say before 15 years) to realise that the customary practice of gifting a watch to a school or college student or to someone joining a new career is lost somewhere. In fact, the gift-aspect of the watch appears to have lost for this has been overtaken by mobile phones, computers, laptops or other modern gizmos. Wearing a watch connotes today more of a lifestyle or a status symbol than of a necessity. In India, only 27 per cent of Indians own a watch. , As of 2007, the total estimated market volume is 39 million units and its value is Rs 2500 crore ($ 625 million). Of the 25 million watches sold in India, those whose prices fall in the range of Rs 1,000 to 3,000 accounted for most profits. And, since the organised watch sector is really interested in this segment, watch sector is emerging as one of the fastest growing sectors in India.

Growth of the industry in India

Till 2003-2004 FY, the watch industry’s performance was quite slow. But, with the entry of some organised brands, the market started growing. Basically, lots of cheap and low price products were available and this was driving people away from branded watches. The penetration of watches was very low in the country - only 20 to 27 per cent at that time. However, during the past three to four years, the organised sector has grown owing to the availability of many international brands, especially Swiss brands, in the market. But if you look at the audience in the age group of 18 to 35 years, they are very fashion conscious and watch is a great part of accessorising of clothing.  Mr Salil Sadanandan, President, Timex and Fashion brands business, Timex Group India Ltd says, “Watches today are seen more as fashion accessory than as a necessity. Though the purpose of the watch seems to be have transformed, there is still a segment of people who wants to possess multiple watches for different occasions. The watch they wear for the office may not suit the party in the evening. So, we as a brand are focusing on these audiences.” Mr Manjot Purewal, MD, Maxima Watches, highlights, “In catering to the demand for watches in India, the organised sector provides around 12 million watches while the unorganised segment supplies around 40 million.”

Latest trends

Watches are positioned in various niches: economy, casual, sporty, semi-formal, formal, luxury. Indian consumers constantly seek new products, designs and brands, particularly 'phoren' (slang for foreign) ones. The youth prefers the so-called sports models while the mass marketers prefer any time-wear that's gold-plated. As time passes, the low-end Indian watch sector is gearing up for a price war. Timex claims to be one of the lowest priced brands in this segment with range starting at Rs 345. HMT, a pioneer since 1961 with aggregate sales of 90 million pieces, still has a 32 per cent market-share. With Tenmax, the latest in the series of formal watches priced at Rs 350 and above, HMT is seeking to strengthen itself in shortly. Mr Sadanandan informs, “In the last two to three years, it is growing at about 10 to 12 percent by value. We as a brand are growing at 30 percent.”

Meanwhile, selling imitations of popular styles and leading brands at half the price, the grey market continues to be a menace for the organised sector. Today, you have entry level watch, then a stylish watch. But, you ultimately want to own the luxury watch. Mr Sadananadan opines, “As a company, we are restructuring ourselves to participate in each segment of watch industry whether it is entry level, lifestyle or luxury.” 

If we look at the latest trends in watch industry, the big and bold models are still in. Then, there is a trend towards 2-tones in gold plus steel viz., bi-colour watches have been catching on and sporty, outdoorsy material (texture or colors) are seeing a growing trend. Also feature-laden watches with many buttons are in vogue among younger kids. Never-seen-before Indiglo displays, internet messenger watches, heart rate monitors, eco-friendly watches, 100-hour chronograph with lap etc. have already become popular features today.

Major Indian players

Some of the major players in India’s watch industry are as follows: 

Titan

Titan Industries is one of India's leading manufacturers of watches and the world's sixth largest watch manufacturer. Established in 1984 as a joint venture between the Tata Group and the Tamilnadu Industrial Development Corporation, the company brought about a paradigm shift in the Indian watch market offering quartz technology with international styling. The company currently manufactures three main watch brands – ‘premium segment’, ‘fastrack’ and ‘sonata’ along with several sub-brands like Titan Edge, Titan Raga and Nebula. Besides these, the brand also offers several collections like Wall Street, Regalia and Gold & Steel, which form a part of the Titan wardrobe. The company has launched its first Swiss made watch, Xylys for the hi-end connoisseur and new age achiever. It also markets Tommy Hilfiger watches under a licensing arrangement. Today, the Titan portfolio has over 60 per cent of the domestic market share in the organised watch market.

Timex

Timex, an America brand, has a heritage that is 150 years old. The focus of the company has always been on innovating, bringing in features and products, which are not available. One of the best-known brands of the company is Indiglow with electro lamination nightlight. Over the last few years, Timex became a group and, then, a single brand company. The company has got license for watches in the fashion as well as luxury segment for brands like Valentiono, Peragamo and Versache. In India, the company has been existing since 1992 and started operating in 1998. Timex came to India through a joint venture with the Tata Group and, then, became a part of Tata Group in 1992. The alliance broke up in 1998. It became an independent company in 1998 and named as Timex watches Ltd and that name has again been changed to Timex Group India Limited.

HMT Limited

HMT watches are the very standard and popular watches in India. Bangalore-based HMT plans to launch a range of trendy, new-generation watches after revamping its marketing set-up and roping in new dealers this year. When asked about HMT’s lagging behind various other watch brands, Mr BL Kaul, Managing Director, HMT watches informs, “We have grown 37 per cent last year. We are the pioneer in the industry and growing along with the industry. Ambassador (car) is still a preferred and trusted brand and still sells with no major change in the model. Same is the case with HMT watches. People still have trust and faith in HMT watches, which they cannot have in new brands.”

HMT is closely watching the entry of trendy and new generation watches in the marketplace. The company will be launching new models for the youth because that's an upcoming market. The new range of watches would be available in the price range of Rs 500 to Rs 2,500. Through a joint venture with Titan Industries, the government plans to revive HMT Watches, a public sector company that has been running loses for years. The government is also planning to provide HMT with more than Rs 700 crore as part of the revival package.

Maxima Watches

Maxima was born in 1996 out of the vision to serve the economically weak segments through a product that was accurate, reliable, guaranteed for quality, backed by after sales service, a national brand and, more importantly, honestly priced at Rs 350. Maxima had about 250 models in 1998 and 1999 but it has today 1000 models in plastic and metal. According to Mr Purewal, “At present we have three company-owned retail outlets and 15 to 17 franchised stores. We are planning to have 75 kiosks in major shopping malls in the coming years.”

Maxima’s Aqua collection has over 350 models with another 100 in the pipeline while Gold collection has over 500 models in both gents and ladies models. Scuba collection features and offers over 50 models. The company opened its first company exclusive outlet at Chandigarh. The brand is today represented on all time zones across the country. The company has also opened a series of service centres at all distributor outlets across the country. 

International brands in India

During the post-Independence era, Indian consumers were wooed by Indian 'time-keepers' like HMT and Allwyn though craze for digital Casios intensified. And today, global watch majors are seeking to hit big 'time' in India. Tissot, Longines, Rolex, Citizen, Omega, Calvin Klein, West End, Fendi, Emporio, Armani, Movado, Rado, Piaget, Chopard, Cartier are all vying for attention of Indian consumers like never before. The world's largest maker of finished watches, the Swatch Group entered India in 1998. Currently, it is present in India through its 100 per cent subsidiary, Swatch Group (India) Private Limited. In 2005, Swatch launched its luxurious watch brand, Breguet, in India at jaw-dropping prices. Each Breguet watch is hand made and has attracted only the very tasteful patrons to this exquisite piece of technology. Mr Yashovardan Saboo, CEO, Ethos Swiss Watch Studio, informs, “The entry of international brands in the Indian watch retail segment is good as it will increase competition and lead the Indian players to delivering better products.” Today, lots of luxury brands have marked their presence in retail industry in India. “ As for watch industry in the organised sector, it is 10 percent of the market and it’s growing”, says Mr Sadanadan.

In March 2007, Moet Hennessy Louis Vuitton (LVMH), promoter of over 50 global luxury brands, announced its plan for an aggressive expansion of its premium watch brand, Tag Heuer. Currently, Tag Heuer, ranked third, captures 10-12 per cent of the luxury watch market in India and is growing at 60 per cent on a year-on-year basis. While the franchise model will be the preferred route for retail expansion in metros across the country, the company is already in talks with India's leading retail chains like Reliance, Shopper's Stop, Pantaloons and DLF for a possible tie-up. Already in brand association with actor Shah Rukh Khan, Tag Heuer recently named  Bollywood star Priyanka Chopra as its brand ambassador.  Mr Sadanandan informs, “As an international brand, we are quite happy with the current scenario of the market. As there’s an increasing interest for luxury brands in India, we have lots of brands like Valentine, Nautica, which we can bring in to Indian markets for Indian consumers.” Gitanjali's joint venture with one of the known names in the international watch industry namely Morellato & Sector S.p.a., launches 10 international watch and jewellery brands.

Retail concept

Ethos Swiss Watch Studio was launched in 2003, with its flagship store at Chandigarh. It assures authenticity, transparency and exclusivity. The display at every Ethos studio is a visual treat with prices exhibited on wall-mounted displays. The layout of each uniquely designed outlet reflects an elegance and ambience that fit the needs of a globetrotting customer, who appreciates an international shopping experience, courteous service and high-quality products. Mr Saboo says, “Ethos is an entirely new concept in as far as retail in Indian watch industry is concerned. Being passionate about watches and aware of the potential on Indian watch industry and having appropriate knowledge of watch industry, I visualised this concept three years before in 2003.” Within just three years, Ethos has grown to a chain of nine stores around the country, spanning Bangalore, Chandigarh, Ludhiana, Mumbai, Pune and NCR and offers more than 25 premium Swiss watch brands including Omega, Corum, Carl F. Bucherer, Rado, Tag Heuer and many more. Mr Sadanandan says, “Despite retail revolution, I think all kind of formats can co-exist - MBOs or EBOs. In standalones, the aim is not only to sell but also giving the consumer an experience about the brand. One can find the entire range under one roof, which is not possible in an usual store. Malls are coming up all across the country and out of 53 stores around 20 are already in malls. We will have more than 70 stores by the end of this year and hopefully, we will have 100 plus stores by next year.”

Titan has 200 exclusive showrooms christened as 'World of Titan', making it to be amongst the largest chains in its category. Titan watches are sold through over 10,000 outlets in over 2,300 cities and internationally in over 30 countries.          

Challenges

The first and the foremost challenge is to rejuvenate the significance of a watch. As of today, it has lost its purpose. Mr Sadanandan says, “Category does not get too much of governmental support. Large duties are charged. With new technology coming in like mobiles, laptops, the basic necessity of watch is under threat and now it is up to manufacturers to ensure that it continues to have the attention of lifestyle and luxury consumers”

Mr Sadanandan highlights, “Indiand have been rated as the highest spending tourists by many countries. So, the Indian consumer is much more aware and much more exposed. One problem with the entry of these luxury brands in India is the entry cost. And then, there is the problem of scarcity of luxury destinations.  That is a big disappointment and something needs to be done regarding this. Luxury brands do not want to rub shoulders with ordinary brands. Moreover, a buyer of luxury brands will not be comfortable enough to shop in that environment.”

Synopsis

Though watches have lost their purpose over the years because of other gadgets like mobile and i-pod, there is no decrease in their manufacturing or retail. Rather, they have got a new market and a new identity. Now, watch has become more of a lifestyle or an accessory than of a necessity. The companies that are into manufacturing or retailing of watch are in the race of attracting consumers with their latest designs: they are upgrading designs not just in looks but in technology and pricing. Moreover, entry of a large number of luxury brands in India is making the competition among retail watch players tougher and tougher. Mr Sadanadan explains, “We have restructured the company into three different domains. Though we do not have today any offering in luxury brand category in India, we are looking forward to having them. Third division is the jewellery division. Jewellery market in India is huge and, more importantly, there is a great synergy between watches and jewellery. We want to be a part of that.”