Titan Industries (Titan), India's largest publicly-held watches and jewellery retailer, is increasing its focus on another revenue stream, apart from its own watch brands. It is aggressively building on its licensed watches business, which lends its portfolio a variety beyond what its home brands such as Titan (the watch brand), Sonata, Fastrack, Zoop and Raga can provide. Titan's watches business brought in Rs 1,687 crore (unaudited) in 2012-13, a growth of 9.6 per cent over the year before.
The company, which has the exclusive licence for global brands such as Tommy Hilfiger and French Connection, has recently added Timberland and Police to its licensed offerings. Titan is parallely expanding its presence in multi-brand watch retailing through its "Helios" chain. The chain sells 50 more brands such as Guess, Fossil, Esprit, DKNY, Gucci, Versace, Emporio Armani, Tag Heur and Raymond Weil, as a dealer, apart from Titan's four licensed brands.
Arun Narayan, head of Helios Business Unit & Licence Brand, Titan Industries, says, "Having worked for the past few years with Tommy Hilfiger and French Connection, we are building on that experience to expand our offerings. We have recently aligned with Police and Timberland, both of which are in the fashion space."
While Titan has got the pan-India licence for Timberland, it has a limited licence for Police. These will be retailed at select retail chains such as Shoppers Stop, Lifestyle and Central, apart from the Helios stores. Helios also had Hugo Boss as part of its licensed portfolio, which has now moved to Titan's exclusive stores. "We want to focus on fashion brands, priced between Rs 6,000 and 15,000. Hugo Boss was in the high-fashion segment and so the decision to move away from licensing that brand," Narayan says.
According to Narayan, the fashion watches market is peeged at around Rs 300 crore and is growing at 25 per cent annually. Tommy Hilfiger is among the largest-selling fashion watch brands in India, having sold as many as 100,000 units, he says. Titan is now testing the market with its latest licensed brands.
The expansion of Titan's licensed brands portfolio is being done in tandem with a widening footprint. Titan is adding more Helios stores, and by end of the current financial year, it targets to increase these to 60 from the current 48. "The mandate we have taken on ourselves is to grow the branded watches segment through which both the sector and Titan will benefit. Titan, in fact, has spun off our division as a separate business unit (SBU), indicating a significant thrust on this segment," Narayan adds.
An SBU for its multibrand chain speaks of the intention to grow, which is apparent in the light of a revamp in Titan's watches business. As part of an operational restructuring, Titan is moving away from being aligned along its many watch brands to creating an unit that addresses watches and accessories as a whole. "During the past decade, we were investing aggressively to build 'Sonata', 'Titan', 'Zoop' and 'Fastrack' as brands. We now feel that all of them have gained excellent traction. These were separate business units (SBUs) and now we are in the process of integrating these SBUs as a functional organisation," explains Bhaskar Bhat, managing director, Titan Industries.
Bhat says the synergies will be significant as budgets will get combined, the brand and marketing management and the go-to-market strategies will get integrated in a single business unit rather than exist for separate brands. "It is all about how we can leverage sales, marketing and retail," Bhat explains.
Bhat, however, emphatically denies that this move is a precursor to spinning off the watches and jewellery business into separate companies. He says that they are delivering value to the shareholders in the combined structure, even as the two businesses are being managed by their respective chief executive officers.
Related Tags:Titan Industries, watches and jewellery retailer, watch brands, Sonata, Fastrack, Zoop, Raga, Tommy Hilfiger, French Connection, Timberland, Guess, Fossil, Esprit, DKNY, Gucci, Versace, Emporio Armani, Tag Heur, Raymond Weil, Arun Narayan, head of Helios