Fashion Brands on Changing Tracks

A macro change, the micro effects


Ritu Marya
Fashion retailers in India have accumulated considerable capacities over the past few years, riding high on the unqualified support received from the nation’s consuming millions, especially the youngsters engaged in the services sector, who demands a more tailored solution. In a consumption-led economy, the active, knowledgeable and demanding new consumers have become the focal point of every product and service innovation which are to be used as a source of insight in every new conceptualisation of retailing. Retailers who are creative are likely to out-perform those who are merely reactive. A holistic approach to retailing creates a more satisfying overall shopping experience across the customers’ searching, buying and usage processes.  


In this story we have endeavoured to understand key elements of change in fashion retailing and buying space by taking into view the story of three fashion retail brands which have been present in India for considerable time. The time period has helped us to take into account the long-term change in fashion consumption and shopping habits in the urban India. The major findings help us to assess the wider context underlying that change. The issue of consumer choice has been increasingly important at the corporate level and has led to reinventing brand image from time to time to stay relevant and attractive, addressing concerns related to new products, modification or repackaging, new format development, market definition over and over. Therefore, we have used actual consumer experience as a yardstick in assessing the practical effectiveness of policy making in the brand boardroom.

Suranjana Basu
Brands are changing their status or consumers are aspiring for more? The market is not responding to the brand’s expectation or lesser brand visibility makes it more niche and exclusive? The debate continues. Where the brands are heading forth?  Definitely it’s not a maze where the brand is lost. Again, it’s not an easy equation where the brand’s destiny perfectly falls in place.  This process of metamorphosis has, actually, made the brands interesting. In this analysis, we’ve picked up the following brands.

UNITED COLORS OF BENETTON
Bending on mass-market approach
The brand, United Colors of Benetton (UCB), which declared in 2010, to this publication, that they’re having 280 sales points and had the plan to increase that number to 350 by FY 2010-2011 was an awe-inspiring brand in early nineties during its initial period.  The epitome of the Italian fashion was among the first ones to give the Indian audience a taste of international fashion ethos.  The well-lit façade of the store, the mannequines donning the latest collections, the banners like spring/summer or autumn/winter collections brought to us the glimpse of fashion world which was never experienced before. The first mover’s advantage of UCB was definitely the brand’s exclusivity. The message was sent across, and that time, UCB, in fact, clinged to that image.  It was a time when the market was preparing itself for the entry of international brands. The internet revolution was yet to happen.  The lack of consumers’ exposure made the brand stand out too ostentatiously.  The socio-economic situations pushed the brands to a higher notch, much higher than what it enjoys in the other developed markets.   


The problems were there. The brand entered through franchise route with DCM, but the exclusivity coupled with alienation triggered the difficulties of lesser brand visibility. The situation worsened with flawed expansion plan, not so appealing product line (failed to comply with value for money), gaps in communication and the result was severing the ties with DCM in 2004. Since then UCB India has been operating in the country through its fully-owned subsidiary.    


The strategy was directed towards mass market and it was only after shedding off this exclusive brand image, the apparel house started to experience profitability. The change was inevitable with the advent of fast fashion brands like Zara and H&M, which, globally, have cornered Benetton’s cost-inducing business strategy. The more vertically integrated fast fashion houses are churning out their offerings within two-weeks, whereas for Benetton it’s the seasonal changes. The company’s latest strategy is to transform company-owned outlets to franchisee-run stores.  This has enabled the brand to cover larger retail space, but size of each unit or store has been slashed down. In most cases, the sprawling areas of the earlier format are now replaced by modestly occupied spaces ranging from 2,500 sq ft to 4,000 sq ft. The company is all set to offer its international shopping experience with larger product lines and innovative concept stores. The variegated offerings by the brand, such as accessories, a perfume line and magazine, still continue to be the attraction quotient of UBC. To some, it’s definitely a cool brand that harps on the image, stylish yet comfortable, whose philosphy focuses more on an individual rather than a customer.  

UCB Customers’ Veiw
•    The brand is viewed as a mass brand with high visibility
•    50% of Benetton buyers choose their brands keeping the season and varieties in mind
•    75% of them feel that despite brand loyalty they are too many brands in this segment to lure customers

Occasion to wear: 75% Usual day wear
Preferred feature: 85% International quality and mass appeal
Pricing: 60% Not bother them

TOMMY HILFIGER
Figuring out aggressive plans
The arrival of Tommy Hilfiger in India coincidentally happened in 2004, the same year when UCB India decided to go on its own with a more market-centric approach. The brand entered through the joint venture between Mohan Murjani and Arvind Mills.  By then the Indian market had already been mature enough and the people have more options with the entry of brands like Marks & Spencer and Mango in 2001. The ups and downs of the brand in the global arena taught this American brand to be more practical in nature. Once Tommy Hilfiger, the brand’s founder, commented that it was not revolution but evolution that actually proved good for the brand. After its initial popularity and fast growth,   the brand’s over supplying of the demand saw the downslide of business in the nineties. Later, more restraint approach by monitoring inventory and instilling merchandising customisation to cater to the regional preference, like dark colours for German choice, and lighter and brighter colours for Spanish preference, the brand gained the market share. This learning of cautious play has been reflected in its global policy, even in India. Though Tommy Hilfiger, as a brand, was looked up to super premium brand in its initial stage in India, the brand’s foray into tier II and tier III cities after four years since its launch in India took away that unnecessary sheen of luxury and brought it more close to the people’s market.  Diverting the focus in a new direction, the brand has set up its outlets in non-metro cities like Indore and Amritsar. The strategic plans of the company are always so relevant with the market demands.  It was one early mover to adopt licensing to captivate the Indian audiences with fashion accessories.

Tommy Hilfiger customers’ view
•    The brand is viewed as a cool, classic American style statement
•    65% of Tommy Holfiger buyers feel that changing preference is imperative
•    60% of them view Benetton and Ed Hardy as the brand’s competitors

Occasion to wear: 60% Party wear
Preferred feature: 50% Brand value and better connectivity with its latest trend
Pricing: 60% Worth every buck spent on it
 
LACOSTE
Labelled as affordable luxury
Lacoste is also one early player that set up its first outlet in Mumbai in 1993. This French lifestyle brand too faced the same pattern of ups and downs. In a feature in Economic Times dated 4th Jan 2003, it was reported that the company was mulling of scaling down its footprints. The then President and CEO of the company, Vikas Gupta, declared that their would be a makeover of the retail format that suit best for premium lifestyle brand like Lacoste.  The customer profile has made it necessary for Lacoste to conform to time’s demand.  In Nilesh Jain’s, the present COO, words, “Over the years, Lacoste has evolved from a men’s polo centric brand to a complete lifestyle brand. We now offer a complete wardrobe for men, women and kids. Apart from apparel categories like polos, t-shirts, shirts, trousers, denims, sweaters, jackets, track suits and so forth, we also offer sporting fashion wear , bags for men and women, fragrances, sunglasses , belts and other accessories like jewellery, swimsuits caps, socks and mufflers.”  This change is not only visible in the collection, but the complete marketing mix. With larger format boutiques offering the wide collection and a luxury shopping experience as opposed to smaller stores earlier, the recent unconventional chic brand campaign, visual merchandising highlighting the complete ensemble offering, the brand has evolved to an affordable luxury lifestyle brand. However, what did not change and would never change are the core values of Lacoste – comfort, simplicity yet elegance accompanied. This change was inevitable as over times the globalisation of Indian consumers have grown manifold and today’s consumers expect the same collection and buying experience from a global brand that a consumer gets in the US or Europe.  The consumer today is not looking for buying just polo or a shirt but goes in for a complete ensemble of not only a matching trouser but also accessories to go with. “The Lacoste stores today are a complete one stop shop for any family with men exploring to purchase the corresponding trouser and a pair of shoes to complete that look, women purchasing bags that complement their sporty attire and hence forth.,” Jain comments.


Since the last decade Lacoste has been promoting a whole new lifestyle corresponding to its original spirit. The brand has become more fashionable, young and trendy in its character, offering wider collection in trendier fits and premium products with fabrics innovations. The emphasis has also been to provide a superlative brand experience through larger stores with new interiors and a very professional and personalised customer service. Commenting on the brand’s niche positioning Jain elaborates, “The niche positioning is an integral part of the brand strategy to position the Lacoste as an exclusive yet accessible brand. Hence, the brand is positioned as an affordable luxury and not premium brand across the world. The niche is not only defined in terms of the price positioning but also by the target customers who prefer high quality timeless products.”  


Evolution transpires when the process is dynamic. This defines the above mentioned brands’ vivacity that throbs with the pulse of time’s demand. Their adaptability actually ensures the brands’ sustainability, who are, for considerable time, creating buzz and hype, exuding the  glamour of fashion.

Lacoste customers’ view
•    The brand is viewed as a premium if not a high-end brand
•    80% of Lacoste buyers experiment with different brands periodically, keeping in tune with the fashion trends  
•    60% of them view Tommy Hilfiger and Diesel as the brand’s competitor

Occasion to wear: 60% Premium sports wear
Preferred feature: 60% Quality and exclusiveness
Pricing: 60% Believe low price leads to compromising on quality

EXPERTS’ VIEWS
Harish Bijoor, Brand-expert & CEO, Harish Bijoor Consults Inc, speaks about brand evolution trend

Retailer: Certain brands, like United Colors of Benetton (UCB) and Tommy Hilfiger, are changing their positioning. Gradually these brands are becoming more for the mass market rather than for niche segment. What’s your take on this?
Harish Bijoor (HJ): No brand that wants volumes will ever paint itself as a niche. UCB and Tommy Hilfiger are really not niche brands. They are brands with a small current franchise in India, but are certainly brands that are looking for more.
The one entity that dictates mass or niche presence is the market. India is morphing as a market from what it was to what it will be in the future. The very demographics and the very nature of consumption is on the morph. From the typical Pyramid the country was (with a small niche of the super-rich at the top, a slightly broader middle-class and a very vast segment of the poor), the country is today different. We are more of a Diamond, with a small super rich, but a very broad segment in the middle-top and middle. This segment is the affording and buying class of India. This class franchises the best brands.  

Retailer: How the brand’s exclusivity, which includes exclusivity in marketing and promotion and even in number of stores, can enhance brand image and build up business?
HJ: Exclusivity is a brand statement to make. Exclusivity shuts out many forms of the buying class. Exclusivity creates snob appeal and literally bears a virtual sign-board outside to many that says “Do not enter”. This is a tactic really, and not a part of brand strategy. It works sometimes, but fails mostly. Gone are the days of snob-appeal. Brands need to be as real as their consumers are. Brands cannot afford to alienate themselves into a narrow dark corner of their own creation.

Customers’ views & Lacoste inputs are generated by S Aadeetya
 

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