Titan Company could also be primarily identified for its watches and jewelry companies, however the multi-category way of life merchandise firm is betting huge on its fragrance and ladies’s bag segments—led by respective manufacturers Skinn and Fastrack—to drive development within the speedy future. Manish Gupta, CEO and VP, fragrances and equipment, talks to Christina Moniz in regards to the development targets for these verticals and the growing demand from non-metro markets. Excerpts:
How have Titan’s fragrances and equipment companies carried out over the previous yr? To what extent has retail inflation impacted development?
The perfume enterprise recovered very properly over the last monetary yr, clocking a income restoration of 84% over FY19-20 and with a development of about 56% over FY20-21. We have seen a powerful restoration throughout each our perfume and equipment companies. This yr, our focus is on the Fastrack women’ and ladies’s luggage vary, as we see large alternative on this phase. With regard to inflation, our enter prices have, in fact, been growing, and we even elevated our costs in December final yr however the full impression continues to be not but felt by the patron. Perhaps we’ll see the precise impression of inflation within the second half of this yr. However, this isn’t distinctive to Titan alone; it’s impacting different manufacturers too.
What are your expectations from the ladies’s luggage class?
The luggage trade is commonly clubbed with baggage as a class, and additionally consists of backpacks and college luggage. The males’s backpack phase has many sturdy baggage gamers, with appreciable go-to-market energy. Therefore, we’re extra excited by the chance within the ladies’s luggage class. As per our estimates, this can be a 5,000-crore trade with the organised phase rising at 13-14% yearly. While 15-20% of the trade is leather-based items, PU primarily based (polyurethane) luggage take the bigger share, which is the place the expansion lies. In the non-leather luggage house, we estimate that 40% consists of organised gamers, at around1,500 crore. This is rising at a a lot sooner charge of round 13% and with the formalisation of the financial system, it should develop even sooner.
Therefore, Titan is betting huge on this phase, and has an ambition of reaching `1,000 crore in 5 years. We are leveraging our Fastrack women’ vary right here too, which is aimed toward younger college-going women. We will likely be showcasing these throughout our 150-plus shops.
What steps are you taking to drive development for Titan Skinn in a aggressive perfumes market overrun with high-end worldwide manufacturers?
We primarily promote Skinn in division retailer chains reminiscent of Shoppers Stop, Lifestyle and Central. Based on rank experiences shared by these retail chains, Skinn has been the main model within the shops for the previous 5 years. We are additionally among the many high two gamers within the phase on e-commerce platforms. Around one-third of our perfume enterprise at this time comes from on-line gross sales. The perfume trade is about 5,500 crore yearly, in keeping with trade estimates, although near 60% of this might be deodorants. There is a big mass of customers trying to improve to high quality fragrances, so I’m not anxious in regards to the presence of worldwide manufacturers. Since experiencing the product is vital, we make investments rather a lot in sampling throughout shops, malls and numerous areas, together with airports. We already occupy a very good place within the phase, and our goal is to reach500 crore within the subsequent two years. We do 360-degree advert campaigns for each the equipment and fragrances companies, with a better thrust on digital. On a mean, we earmark a very good 17% of our revenues yearly for advertising.
If Fastrack and Skinn function within the aspirational market, what sort of volumes do you anticipate from tier-II and III markets?
We often categorise our gross sales as the highest eight cities and the remainder of India. Currently, 45% of our gross sales for each companies come from the highest eight markets, and the rest from the remainder of India. However, the remainder of India is rising at a a lot sooner tempo, particularly within the final two years. One motive for this development in demand is probably as a result of a lot of professionals moved again from the metros to their residence cities. We anticipate to see excessive volumes of development from these markets sooner or later as we develop our footprint.
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