Business analysis and overview of titan watches

Business analysis and overview of titan watches Titan is one of the largest watch producer in India and sixth largest in the world. Titan manufactures over 7 million watches per annum and have 65 million customer. In 1984 titan was established as a joint venture between the Tata Group and Tamil Nadu Industrial Development Corporation. Manufacturing in a state- of -the art at Hosur, Tamil Nadu the company brought the large change in Indian market, by offering quartz technology with international styling. By understanding the different segments in the market, the company launched its second brand Sonata watch, as value brand for those who like styled watches with affordable prices. In last two decade the company has build an very good impression in watch business to become Indias largest manufacturer and world largest sixth manufacturer of watches. This was mainly because good formidable distribution network. Being one of largest retail chain of exclusive retail showroom for watches called The world of Titan spread over 100 towns. Titan have branches over 30 countries, its also have multi brand outlets named Time Zone, service centres and dealer outlets. The company has watch plant at Dehradun (UP) and Baddi (Himachal Pradesh) and electronic circuit boards in Goa. The promoters held majority stake of the company, with Tidco having 28% of the shares and Tata Group companies owing 25% of the shares and the public sharing holding around 28% in the company. The rest stake is held by the foreign institution, non resident Indian, mutual fund and other institution. It also acquires a license for global brands such as Tommy Hilfiger and Hugo Boss, while. It has also in its portfolio its first Swiss Made watch brand Xylys. In 1995 the company capitalize to brand Tanishq as diversified into jewellery in fragmented market operating no brand in urban city. Also in 2005 the company launched its second Jewellery brand, GoldPlus, as using its opportunity for capitalizing in small town and rural India. Its also diversified into fashion Eyewear by launching Fastrack Eye Gear sunglasses as well as prescription eyewear. Investigation and analysis Under the help of moderate implementation and control, it is evident that product development strategies fit for Titan and bring maximized profit to it. Core Competency Each purchases are delivered with Quality is Titans core competency and this for the lower segment watches like maxima and HMT. Whenever any people buy Titan watches they know its a piece of quality and is backed by a Tatas. Titans innovations in the area of style, uniqueness, technology and they have a market from steel to gold to diamonds. Titan Edge is an only creation in the world, owned by Titan. Situation Analysis: Environmental Analysis: Environmental analysis helps Titan to understand what is happening both inside and Outside the company and to increase the probability that the strategies will appropriately Reflects its organizational environment, PEST analysis for Titan consists of following Factors: Political: It has a stable Government Tinges of liberalization Foreign brands had started entering the Indian market with government permission. Economic: Current economic downturn The purchasing power of consumers has decreased due to credit crunch and recession and they may also spend less on luxury items. E-commerce is becoming prevalent Protected Economy Social: There is been a lot changes in lifestyle Indians Patronizing the Foreign brand. Increasing aspirations Grey Market Good Quality/foreign brands bought to India (http://www.scribd.com/doc/37204122/Swatch-Mkting-Plan) Technological: Having a better technological practices Quartz watches was the future Technological products were having better preference Watches were traditional mechanical (http://www.scribd.com/doc/37204122/Swatch-Mkting-Plan) Competitive Analysis: Competitive analysis is a vital part of a marketing plan. Its purpose is to determine the strength and weaknesses of the competitors within the market. Porters Five Forces analysis for Titan can be interpreted as follows: New Entrants: Strong brand recognition and customer loyalty, Titan is a popular brand among customers substitution. Many brands provide with range of similar styles Threat from counter felt products Buyer Power: Buyer power is high in this industry simply due to the presence of so many competitors selling the same products. It is only differentiated in price and consumer loyalty Overall Intensity of Rivalry: Intense competition within in a very crowded market (http://www.scribd.com/doc/37204122/Swatch-Mkting-Plan) SWOT ANALYSIS: Swot analysis is the overall evaluation of a companys strengths, weakness, opportunities and threats and is a way to monitoring the external and internal marketing environment (Kotler, 2009, p.89). Strengths: Strong brand and customer loyalty Repositioning into in the fashion market. A wide range of products with different designs across all price points Production and training facility is flexible enough to adapt new technologies. Industrial relations is good. Till date company did not encounter any kind of labour or industrial relations problem which can put company into jeopardy. Watch industry is growing industry which faster rate As the population is rising, the watch market is also expanding Customers are not very price sensitive as far as quality watch is concerned Weakness: There is not much advertising done by watch industry No innovation in products There are few number of exclusive showrooms that reduces the consumers accessibility to the product Low asset turnover ratio Weak employee productively No emphasis on RD and designs It lacks team spirits and awareness which can result in low utilization of human and machine capacities. Opportunities: There is more need of fashionable luxury watch and fine luxury watch brands that can be targeted in UK, as customers are more like trendsetter and fashionable. UK especially London is a metropolitan city which makes it more attractive for the new company. Youth are more brand conscious than their predecessors. That leads to the expansion of the market for branded watches. E-commerce offers trading opportunities The credit crunch can force customers to buy low priced items over luxury items Threats: There are many foreign players entering in the race Too many players will dilute the market and the profit margin. Mobile phones acting as substitutes of the watches. Counterfeit products Intense competition between different companies within a crowded market Current economic recession and policy of price fixing decrease the sales (http://www.scribd.com/doc/40142805/Marketing-Strategy-of-Titan-Watches1) The Indian watch industry began in the year 1961 with the commissioning of the watch division of Titan. The first watch model manufactured by HMT was the Janata model in the year 1962. HMT was the leader in the watch market till the Tatas formed Titan watches in association with Tamil Nadu Industrial Development Corporation in the year 1987. They took a major strategy decision, which later changed the face of the Indian watch market to manufacture only quartz watches. Liberalisation in 1992 and removal of quantitative restrictions due to WTO has opened the doors for many the Indian market viz. Tissot, Swatch, Omega, Rado, TAGHeuer. The import duties on watches are falling which makes the Indian market look attractive for the global majors like Casio, Swatch and Citizen. Recommendations: MARKETING OBJECTIVES: Titans wants to become the creative and innovative leading brand in global market and establish a strong brand image in the mind of consumers and its financial objectives includes its profit to increase by 10% annually, sales to increase by 21.7% over the next 2 years. Strategic Options and Strategic Choice: According to the SWOT analysis above, it is evident the Titan has a steady presence in the fashion market with strong brand image and customer loyalty. In order to maintain and take advantages of such strengths, Titan should adopt the market penetration strategy which means to sell existing products into existing markets with the objectives of securing the dominance of current market and increasing market share from current products. (kotler, 2009, p.85). Comparing with the cost- leadership strategy and the product development strategy, the former calls for price cutting when selling products It not only reduces companys sales profit, but also affects its brand image. The latter strategy requires company to develop a new product, which may cost so much money and time to do the market research and product test. Therefore, Market penetration strategy is considered as the core strategy for TITAN. According to my suggestions titan should use Ansoffs product/market matrix in order to be creative and innovative brand in global market. As Ansoff growth matrix is a tool which helps businesses to decide their product and market growth strategy. Ansoffs product/market growth gives an idea to businesses growing depends on whether it markets new or existing products in new or existing markets. http://tutor2u.net/business/images/Ansoff%20Matrix%20w500.gif Daigram2: http://tutor2u.net/business/strategy/ansoff_matrix.htm The above diagram illustrates the way ansoffs product/market matrix works. Once Titan knows where they should put the new product in the existing market they also need have a proper STP (Segmentation, Targeting, and Positioning) at the time of launching a product. Segmentation and Targeting: As Kotler, Philip (2009, p.247) defined that segmentation is to divide a market in to distinct groups of buyers with different needs, characteristics of behaviour, who might require separate products. The profile for the Titans ideal customers consists of following factors: Demographic: Gender: Male and Female, in 2007, 11.1% of women bought watches for self, while 9.3% went to men, 5.3% of women bought watches for someone else, while 3.4% went to men. (http://www.scribd.com/doc/24305562/Titan-STP) Age: In terms of amount of people who purchased watches during 2007, 15-19 accounted for 23.4%, 20-24 accounted for 18.1% and 25 34 accounted to 16.9% Lifestyle: Consumers in UK are more inclined towards the trendy styles which represent their uniqueness and taste and personality. FasTrack, Raga, Sonata, Xylys, Nebula and Flip are sub-brands within Titan that are aimed at the youth, men, women and children Sonata is the value for money watch brand from Titan industries. It is targeted at consumers seeking durability and value with a clear positioning of No compromise watch. FasTrack was positioned as a youth brand. The young Indian racing driver Narain Karthikeyan was the brand ambassador. The company used focused distribution supplementing its watch outlets with youth focused outlets like music stores and internet cafà ©s for FasTrack. Titan targeted its Raga watches at women in the premium segment which gave them the feeling of intimacy. The company realized that more women were wearing watches for functions. It offered slimmed down and sleeker watches for women. The Raga range remained for more special reasons, like marriages or parties. Xylys comes from the House of Titan, is targeting a new generation of achievers who are looking for symbols to reflect their lifestyle, attitude, moods and beliefs. Nebula-precious jewellery watches from Titan. It is a collection of intricately carved designs for women inspired by floral patterns and these watches are engraved with beautiful patterns in gold and precious stones. This is for the premium segment. Titan Edge and Titan Steel are the mainstream Titan products which enhance the brands image of leadership, innovation and pride. Titan is considered to have one of the successful segmentation and targeting. Titan adopted a strategy of focus. Titan tries to achieve competitive advantage by optimizing its strategy in the different market segments. Once the firm has identified its market segment, it must decide which ones to target (Kotler, 2009, p.267). Titan will focus on working women among the 24 35 age group. Firstly, it is clear that female purchasing goods for themselves more than male and they take the lead in the whole market. Therefore, in order to be more self aware in the fashion sense and more likely to be in influenced by trends, as well as lifestyle, women willing to spend more on themselves. Secondly, more recently there is a downward tendency in the number of marriage in the UK. Two main drivers are behind it. One is single people increased from 3 million in 1997 million to 9.2 million in 2007. The other is the average age at which couples are getting married has risen to 32 for men and 29 for women. Therefore, the 24 35 age groups may be more established in independent finance and lifestyle. (http://www.scribd.com/doc/24305562/Titan-STP) Targeting: Titans watch TIME RAGA is an exclusive watch for women. The TIME RAGA collection is elegant, delicate and feminine with each piece being truly unique. It includes an exclusive collection of decorative motifs with studded bracelets. It is mainly inspired for working women class. It is crafted exclusively for sophisticated woman, who wears silver jewellery with elan, the TIME RAGA makes a perfect accessory that completes a womans wardrobe. (http://www.scribd.com/doc/24305562/Titan-STP) Positioning: In UK TIME RAGA is positioned as the slimmest watch in the universe. All good things are packaged small or can be packaged slimmest in the world. Brand positioning of TIME RAGA: Promise of purity and a unique experience: its design and retail innovation have been hallmark of Titans all these years. TIME RAGA guarantees the purity of its jewellery and certifies the quality of its diamonds and coloured gems in writing. Luxury: TIME RAGA will be positioned as a branded jewellery of luxury rather than commodity. It moves jewellery beyond investment to the fashion and adornment sector. It will be positioned as superior product. It will be positioned as a totally new perspective to jewellery buying especially when it comes to exquisite oriental jewellery. (http://www.scribd.com/doc/24305562/Titan-STP) To working women among the 24 to 35 age group, who have strong purchase power, Titan is the watchmaker that produces more unique watches than any other brands for its the most variety of designs. Their high quality but low price make customers move to multi ownership across a range of looks and price points. Titan has managed to get fair market in Middle East and Africa but its failure in Europe was a downturn for the Company as the return was not as good as investment made for the expansion. Titan has decided to revamp its flagship watch brand in Europe mainly in UK. Titan wants to reposition it more youthful and relevant to the changing times. Titan has entered the International markets in 1989 through the export of watch movements. Titans first global footprint was placed in the UAE the largest market in the Middle East then it moved towards Egypt, Oman, Saudi Arabia and few markets in Africa. Though it faced strong competition, it reached the sales of 100,000 watches within a year of its launch. It started to move globally and moves towards Sri Lanka, Bangladesh, Maldives and Nepal. After its extensive survey, it concluded that it needs good reason to stock the brand. Titan needs to re-position its brand image in the UK market. And so Titan decided to against soft option of driving its globalization through private label exports. It would launch its product under its own brand with market positioning Therefore Titan found a massive advertising campaign to create brand awareness. It also participated in the fair which showcases the worlds biggest watch brand in the world. Marketing Mix: Price: As achieve our marketing objectives, we can so some change in the pricing. Price needs to have unique benefits which can offer a benefit to the customer in the competitive market. Its often assumed that higher prices are a luxurious product. Titan needs to select the pricing for its product which can be affected and decided by the cost of manufacture, latest plant, and high investment for the product. It can also open duty free shops in the airports such as Gatwick and Birmingham airport and in Eurostar station in London. Eurostar estimates to passenger number will increase from 8.3 million this year to 10 million by 2010 (Railnews, 2007). It can also put banner on the internet such as Face Book. Product: Titans main objectives was to make consumers buy more than one watch to increase market size by increasing it augment demand for watches. It can it product different range for different segments. It should introduce a jewellery watches to attract working women in UK. Product should be customizing to personalize the watch to fit customers taste and make it more unique. It can use specialize features that emphasize more special and limited edition for a youthful, innovative and exciting look. Place: It can create place from positioning. It can attract customers by having its own showroom which will help to increase it purchase in the competitive market. It can also have dedicated exclusive distributions which can exclusive showcase Titan products and its ranges. It can also make an investment in a showroom and also in line with the product positioning. It can rent stores in prime locations which has busy high street which can also help increase its sales. Promotion: Titan can achieve its marketing objectives by exploring its relationships with its suppliers, distributors and all channels which can help to increase its sales. It can come up with promotion tactics such as gift items, promotion themes and etc. It can focus more on its market research feedback which can improve its image in the local and international market. It should focus more on the after sale service which is very important in UK where brands with reputation is recognised. It can endorse its product with celebrity and use their image. Advertising such as print / broadcast ads, posters and leaflets or billboards, it can also use direct and indirect marketing such as E-mails, mobile messages and websites. Conclusion: To increase its visibility, Titan Company can sponsor events similar to fashion shows which all latest designs launched are displayed. This is important as it has a great effect on different segments of the customers in different ways. Titan should also have Tie up with radio channels and television to broadcast and telecast its advertisement about various sales promotions from time to time. Specially, RD needs more investment as customer expectations are changing rapidly. Titan can focus more on introducing more varieties and luxury items in the market at regular interval. Titan should introduce exclusive collection for working women in order to have more contemporary and complements for any fashion styles. Tie up with international watch brands to make the product stronger in the market. Titan should use internet to spread awareness among consumer about the brand. Finally, on the basis of all analyses, it is obvious that market penetration strategy fit for Titan. Titans main target should be working women who own a strong purchasing power and pursue a trendy lifestyle. Therefore, customized watches right aim at this target market. This innovation evolution will essentially not only strengthen its current customer loyalty, but also broaden its consumer base. Selecting the watch parts from a wide range of current watches could reduce the cost. However, due to the limited and unique features, these watches sell with high price. Hence the turnover would be increased thus Titan UK company would make the maximized benefit. http://www.tata.com/article.aspx?artid=8xXL3Vvjg+4= can some points from here..