TITANONE COMPANY, MANY BRANDS

From Style Statement to Personality Statement

Company ProfileSL NO PARTICULAR DETAILS

1 Incorporated in 26-07-1984

2 Name of the Company TITAN COMPANY LIMITED

3 Category Consumer Products

4 Sector Lifestyle and Retail

5 Principle Business Activity 1. Jewellery (77.30%)2. Watches (17.31%)

6 % Share Holding of Promoters TITAN (46.94%)TIDCO (27.88%)

TATA Sons Ltd (20.85%)TATA Invt Corp ltd (2.01%)

7 Total Sales (in units) 15 million

8 Market Share 55-60%

9 Exports Share in total sales 15%

10 Global Ranking 5th

Financial & Market Status2015-16

INFORMATION DATA ANALYSIS

Total Sales (2015-16) 11,295.74 Cr. The Company’s sales income declined by 5.4 % to 11,295.74 crores compared with ` 11,936.71 crores in the previous year.

Net Profit (2015-16) 705.85 Net profit declined by 14.2% to 705.85 crores.

Reasons for decline (Overall)

Decline in Jewellery segment 7.6%

This performance came in the backdrop of an environment where the consumer sentiment did not pick up as expected and regulatory measures adversely affected the jewellery business.

Status on Watch Industry Growth of 1.7% The Watches business of the Company recorded an income of 1,953.55 crores, a growth of 1.7%

Comparative Analysis of the financial performance for the year 2015

Particulars TITAN (Rs. In crores)

CITIZEN (thousands of US dollars)

TIMEX(Rs. In lakhs)

Total Sales 11,295.74 $ 3,082,012 17,030

Loss for the Year ------------------- --------------------- 927

Profit for the Year 1,953.55 $ 0.37 -------------------

Growth level compared to 2014

1.7% 3%

GROWTH OF RETAIL ORGANISATION• PHASE-1(1987 to 1992)

1st showroom in Bangalore, with a single objective of showcasing the ‘Titan Brand’.

Introduction of Quartz watches, superior in terms of accuracy and styling options.

Large range of watches under one roof with greater ambience and comfortable environment and also the prices were uniformly displayed.

• PHASE-2(1992 to 1998) opened first few stores with just an interest in showcasing the Brand. These showrooms were “immensely profitable”. World of Titan became one of the serious channels of business and also became

a catalyst to Titan watch which trade in general. Success of WOTs encouraged trade to make a shift from just selling to retailing. These developments saw a growth in the market and also enhanced profitability.

• PHASE-3(1998-2004) Increasing penetration in smaller towns and cities. Dual focus where these showrooms are reinvented every five years in

terms of looks, trends, ambience, retail experience and also to match with international standards.

Competition with international brands. New layouts, innovative wall displays interspersed with accessories and

islands like counters, which encouraged the modern evolved customer. Breaking away the concept of ‘selling from behind the counter’. Each showroom has a turnover of about Rs.20 to 30 million p.a in large

cities & Rs. half million p.a in smaller towns. High growth of about 15% to 25% every year. More than 24% of return on investment. Professional expertise in setting up & operating showrooms. ‘Authorised service centre’ besides each showroom

STP

Segment Watch brands from luxury to sporty to fashion

Target Group Mid and Premium Market Working men and womenPositioning Not just a watch, but a style statement

Product Portfolio

Brands1.Fastrack2.Sonata

SWOT Analysis

Strengths

1. Large network of exclusive stores and service centres2. High Top of the mind recall, especially for the Mid market segment3. Different sub-brands under the brand Titan have been successful in their positioning based on Demographic segmentation4. One of the world’s top five and India’s biggest watch manufacturer5. Titan watches are exported in over 40 countries

Weaknesses

1. Premium category Titan brands like Xylys have been camouflaged by the Titan brand Image of being a mid-market player2. Haven’t penetrated the global market as some other international watch makers

Opportunities1. India is an under penetrated market for watches2. Global expansion and tie-ups with global watch and Jewellry brands

Threats1. Broad Target segment may lead to lack of focus in Brand strategy2. Stiff Competition faced by foreign brands, particularly in the premium segment

Competition

Competitors

1. Timex2. Casio3. Citizen

HMT-What it did wrong, and How it could’ve been done better (1)

• HMT had the overall market share of 26% during 1997-98 and it dropped to 14% during 2001-02.

• Out of this, HMT still had 70% market share of Mechanical watches during 1997-98,which increased to 94% during 2001-02.

• Company performed poor in Quartz market, it had market share of 8% for five year during 1998-2002.

• This shows how the sale of mechanical watches dropped drastically. The value curve for Mechanical watches kept falling and there was no driving force from HMT to oppose this.

2. HMT remained into losses for last 5 years. Though it launched many watches to gain the market share into the quartz market, it could not capitalize on the success of these watches due to many reasons.

3. Some of the decisions made by HMT were unreasonable given theproduction ability of the company itself. To meet requirements of thequartz market, company outsourced the production of various visualparts (dial, cases etc.) [Outsourced from Tennmax India Ltd.]. It gotlarge these parts in large volume from this organization, while itsown production capacity of dials and cases remained underutilized at34% and 47% respectively.

4. HMT started outsourcing the watch manufacturing to other firms.Suspensions of services from these firms lead the problem ofstopping them to use the HMT logo in their production. HMT alsostarted to employ vendors with quite less experience and lesstechnical expertise. Outsourcing led spurious watches in the market.HMT failed to act immediately and took 15 months to take follow upaction in July 2002.