IndiGene T-Shirts

Marketing Management Assignment

Akshata Kar (P39180)

Jital Akabari (P39197)

Kuldeep Prakash (P39201)

Naveen Kumar Sarigala (P39209)

Pramod Patil (P39213)

Rajni Vidhani (P39217)

 Table of Contents

1. Executive Summary ................................................................................................................................ 3

2. Situational Analysis ................................................................................................................................ 4
3. Environment Analysis ............................................................................................................................ 9
4. Competition Analysis ............................................................................................................................ 12
5. Consumer Behavior .............................................................................................................................. 15
6. Segmentation, Targeting & Positioning (Strategic mix) .................................................................... 17
7. Pricing and Promotion ......................................................................................................................... 19
8. Financials, Budgets and Forecasts....................................................................................................... 22
9. Control ................................................................................................................................................... 23
10. Implementation ................................................................................................................................... 24
11. References ............................................................................................................................................ 25
12. Annexures…………………………………………………………………………………………….26

MMT Assignment 2 IndiGene T-Shirt

 1. Executive Summary

Indian Market has seen a good growth in the t-shirts market owing to the advent of e-commerce
sites and advent of big t-shirt sellers. The size of the T-shirt market in India is estimated to be at
Rs 5,400 crores, according to the latest report from Technopak Analysis. T-shirts have become a
major mode of communication in the recent times. This need has been evolving as consumer
communities are growing more diverse in ethnicity, wealth, lifestyle, and values based on their
local culture. Through a primary survey it is found that people buy clothes from online websites
but there is always a degree of uncertainty associated with it with respect to the fit and finish of
the product.

IndiGene T-shirts is local pop culture t-shirt brand catering through shops/shopping centres in
tier 2 and tier 3 Anand, Vadodara, Indore, Nasik & Pune and also on online platforms such as
Amazon, Flipkart, Myntra, etc. These locations have been chosen keeping in view their rich local
culture, presence of youth and proximity to famous tourist place. The cost advantage and ease of
operations are added advantage of these tier of 2 cities and will help us to penetrate the
market. Our aim is to provide an emotional bond to the customer through our USP of local pop
culture. We propose to target the young, enthusiastic and expressive segment of population in the
age group of 15-29 years. We are accommodating the audience which is price insensitive in the
range of Rs. 300 to Rs. 500. This information has been extracted from the online survey we
conducted. Our objective for going about the pricing is to establish ourselves as a quality brand
which is affordable to the customer without giving the idea of a cheap product.

We aim to use various channels to promote our t-shirts in the market. These channels can be
broadly defined as Digital Media Marketing, Sales Promotions and Public Relations. The
marketing plan will be implemented in 3 phases, and will be controlled and monitored through
various control mechanisms. These control mechanisms include monitoring the sales figures,
maintaining MIS, and using feedback mechanisms. This will help us ensure that the plan is
implemented without any loopholes.

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 2. Situational Analysis

Market Summary

T-shirts, which evolved from undergarments, have become more than a piece of clothing and
akin to comfort. The garment becomes even more widely used during summer, given that it is
made of light fabrics. There’s little that can top the simple, timeless combination of jeans and a t-
shirt. But just because one wants comfort doesn’t mean that their signature style should be
compromised. Unfortunately, with the influx of fast fashion sometimes staying original can be a
challenge but luckily there is a whole new movement to address this very problem. Popular &
Local culture references and catchy graphic design run amok in this ecosystem of paint and
fabric, and the kind of attention paid to the quality of manufacturing these T-shirts has proven to
be quite jaw-dropping. Therefore, the market for t-shirts in India is growing at a very rapid pace
and the size of this market has been growing owing to the penetration of e-commerce sites.

Indian Market: Size and Growth Potential

Indian market has seen a good growth in the t-shirts market owing to the advent of e-commerce
sites and of big t-shirt sellers. Content companies like AIB and comedians like Biswa Kalyan
Rath and Zakir Khan have popularized tee shirts with topical slogans.
All India Bakchod (AIB) which became famous for its comedy business entered the t-shirt
market in 2012 by commissioning “The Souled Store’ which
sells popular culture reference t-shirts. Today the store sells
4000 t-shirts per month and every t-shirt is priced at 599 or
above. Other than this, the big market players such as
Bewakoof.com which started in year 2012 has a market share
of 100 Crores[1], 1469 Originals, which started in 2002 and
targeted only Punjabi population has grown to a brand which
sells 200 t-shirts per day, whereas redwolf.in which started in
2012 specializes in selling t-shirts and merchandise of popular
international and Indian Music Artists sells 250 t-shirts per
day. All of these stores with the help of e-commerce sites
targeted a big chunk of Indian Population and thereby made the concept of Pop-culture t-shirts
ubiquitous.

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The size of the T-shirt market in India is estimated to be at Rs. 5,400 crores, according to the
latest report from Technopak Analysis[8]. Almost 83% of this category is dominated by
menswear but women’s T-shirt market is fast catching up, growing at a compound annual growth
rate of 17%. A Credence Research[3] report from March 2018 says that India is set to register the
highest growth rate for T-shirts sale in the Asia-Pacific region in the next five years. T-shirt sales
have become second biggest revenue source for Indian Independent music bands, after live
shows and this is yet another reason driving the growth of t-shirt market in India. Also, Global
trends in segments such as branded, logo tee shirts have found little resonance with Indian
buyers and therefore the popular culture t-shirts have further got a push in the market.

Market Need Identification

T-shirts have become a major mode of communication in the recent times. A student and an
employed person both desire a great collection according to their personality. ‘This need has
been evolving as consumer communities are growing more diverse in ethnicity, wealth, lifestyle,
and values. As per the recent trends, consumers use t-shirts as a vehicle of communication and
also, to depict the trends that they follow. With growth of digitalization and ease to access
contents such as web series, movies, etc., the market for t-shirts is highly dependent on such
trending topics. But, at the same time people still want to remain connected with their local
culture. Therefore, we tried to understand if they wish to purchase the t-shirts which depict their
local culture and have native references. The results of the survey show us that out of 175
respondents 54% respondents are willing to buy our product.
Thereafter, in order to understand the buying behaviour and decide on the channel for selling, we
tried to understand the channels which are used by consumers to buy these t-shirts. The results
were as follows:

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 Purchase Location

Online 127

Malls 106

Local Shops 58

Factory outlet 1

Decathalon 1

0 20 40 60 80 100 120 140

Number of Respondents

This shows that though higher number of people buy t-shirts online, there is still significant
number of people who prefer purchasing from local shops and Malls. This can be because of the
fact that there is always a degree of uncertainty associated with online buying with respect to the
fit and finish of the product. And this involves hassle of return and replacement of the product.
Therefore, people prefer purchasing clothes from malls and local shops for the ‘touch and feel’
of the product. However, these sources do not have options that are trendy and up to date the
fashion.
Therefore, we decided that in order to provide convenience to our customers, we will sell
through offline channels primarily and online sources will be the secondary source.

The chosen market: Operating areas

IndiGene will promote t-shirts in tier 2 cities i.e. Anand, Vadodara, Indore and Nasik and also on
online platforms such as Amazon.in, Flipkart.com, Myntra.com, etc. These locations have been
chosen keeping in view the cost advantage, ease of operations and high cultural orientation.
Also, it becomes difficult to sustain in tier 1 cities given the high penetration of e-commerce in
these cities & the facts that these cities become melting pot of culture owing to which there is no
indigenous culture which gets promoted in these cities. Therefore, we aim to cater to tier 2 cities
where in people still prefer buying goods offline and are more culture oriented. Hence, we plan
to distribute our product in these cities by supplying to the super markets, malls and local stores

MMT Assignment 6 IndiGene T-Shirt

such as gift shops and convenience stores. We will also target Pune because though it is a tier 1
city, there exists high culture orientation in the city and also it will help us in scaling up.
Vadodara is the hub of industries in Gujarat. Owing to the same fact, the raw material cost and
labour cost in this city is low and also is easily available. Also, its proximity to Ahmedabad and
Surat make it easier to procure raw material from these cities because the textile industry is very
well developed here. Therefore, we will setup our production plant in Vadodara. Considering the
fact that there are a good number of colleges present in Vadodara, it also becomes a good sales
location for us. The other locations are also relatively closer to Vadodara and therefore,
transportation costs can also be reduced while supplying the t-shirts to these locations.
Whereas, since we are going to set up our plant in Vadodara, i.e., in Western region, Maharashtra
is another potential market where we aim to supply our t-shirts. Nasik and Pune therefore, have
been chosen considering the fact that these two cities have high presence of youth and are
growing at a very fast pace. Nasik has an advantage because of presence of tourist locations in
nearby regions. Whereas, Pune gives us the advantage in terms of high youth presence owing to
high number of colleges present in the city & also, the city has been growing at a very a fast pace
which will give us a greater exposure too. Indore again has been developing at a good pace in
past few years and therefore, it poses growth potential for us to grow and also its vicinity to
Vadodara is another factor as to why we chose this location.
Online Channels cannot be left untapped owing to the fact that advent of e-commerce has
changed the way consumers buy products. Therefore, we will also sell our product on online
platforms such as Amazon.in, Flipkart.com, Myntra.com, etc. This will help us in distributing
our product in more areas and also provide us with greater market coverage.
We plan to tie up with the outlets that are located on locations which are close to colleges, tourist
places and shopping centres. This will increase the chances of the t-shirts getting noticed and
since, there is higher footfall on these locations, the chances of selling products here increase as
compared to secluded locations. Tourist locations will be tapped because when tourists visit
these locations, they have a tendency to purchase something that might act as a souvenir. Also,
we will distribute to the super markets such as Reliance Trends, Big Bazaar, D-Mart, etc. The
shelves chosen for all these stores will be such that the t-shirts are noticeable and impulse buying
takes place.

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Product Characteristics
We aim to deliver best quality product and use Direct to Garment Technology which will
provide better graphics and better durability to our products. The basic characteristics are:

• Affordability: Keeping in mind, our target group which is youth lying between 14 to 30
years of age and school & college going students, which still doesn’t spend very high amount
on clothing, we strive to deliver affordable products.
• Relatability: Our products include a range of t-shirts which are designed keeping in mind
regional culture. This will an association with the product and emotional connect that will
serve as s factor of relatability.
• Quality: Assurance of standardized 100% cotton-blend fabric for comfort and durability
which is fade-proof, easy-to-wash, and flexible.
• Convenience: We ensure convenience of customers by providing our product at various
locations through an intensive distribution channel which will cover most of the target
segment and will provide them an ease to purchase. We also ensure low stringency in
exchange.
• Usability: IndiGene T-shirts add a fresh and vibrant touch to your casual wardrobe.
• Specifications: These t-shirts cater to customers wearing sizes from S to XXXL. We make
varied range of t-shirts which are suitable for all genders. Various options of the neck and
sleeve styles will also be available for customers.

MMT Assignment 8 IndiGene T-Shirt

 3. Environment Analysis

Every business operates in a particular environment and it is this environment which promotes or
hampers the growth of an organization. Hence, it becomes imperative to understand the
environment in order to weigh the growth opportunities for the business. Therefore, we have
considered below mentioned factors in order to understand the environment for our business:

• Political Factors: The growing support of Government of India for small and medium
enterprises, offers a great opportunity for new entrants in small and medium scale business.
The single point registration, credit facilitation has been providing conducive environment
for small and medium enterprises to set up their business. Government’s push towards
promotion of small and medium scale enterprises has led to improving the ease of doing
business with supportive tax structures. According to a study[4] by integrated solutions
provider Instamojo, the Micro, Small and Medium Enterprises (MSMEs) present in Tier-II
and Tier-III cities are growing at much faster pace than their counterparts in tier-1 cities.
Over the past year, the turnover of MSMEs in tier-I cities is more than doubled but those in
tier-II and tier-III cities have scored 75 percent growth in their revenue.
• Economic Factors: Market expansion in non-metros seems a lucrative opportunity for
domestic and international brands. Once considered value conscious consumers of Tier -II
cities are now open to spend more on fashion and look good. Apparel retail in non-metros is
growing exponentially due to which more brands are entering hinterlands. However, nearly
89 per cent of shopping in India still occurs at traditional neighbourhood stores[5]. Thus, with
increasing disposable income available with young and middle-aged population, has
revolutionized the apparel market with increasing spending on clothing in general. In 2015,
per capita apparel consumption in India was just 45 dollars (Rs 2,894), compared to 172
dollars (Rs 11,063) in China. By 2025, India’s per capita spend is expected to jump to 123
dollars (Rs 7,911). In addition, changing culture and trend among the youth has led to apparel
especially t-shirts becoming a way to express them. Thus, considering overall rise on apparel
spending, changing preferences of youth with more perceived value for apparel like t-shirts
and inability of big brand retail outlets to penetrate tier 3 and lower cities offers good
economic prospects for a localized focused approach.

MMT Assignment 9 IndiGene T-Shirt

• Social Factors: The advent of digital revolution has given boost to numerous industries in
the past decade and a half. The use of social media, video streaming services, and ease of
access of digital content from across the world has led to development of many popular
cultures among the people. In the Indian context, along with increasing association with
western world and its culture, pop culture now is increasingly turning its gaze inwards, for a
generation that is far more connected. Local culture references, slangs, vernacular languages
are being embraced with much delight and increasingly becoming part of localized popular
cultures. This offers lot of opportunities to cater to the needs of inclusion of such popular
cultures in apparel and merchandizing. Although a lot of outlets/firms are catering to the
national and international pop culture merchandize, there seems a gap when it comes to
incorporating such localized cultures.
• Technological Factors: Technology in general has played an important role in the way
apparel market has been changing rapidly. As discussed earlier, digitalization has played an
important role in the way this industry has taken shape. The e-retail market has given a new
boom to the market in the tier 1 and tier 2 cities of India. The e-retailing companies have
been able to leverage upon the popularity of cultures like movies, T.V. series, web series,
sports to engage the youth in the apparel and merchandize offerings. Also, the 4-G revolution
in the country has been pivotal in popularizing these cultures. Thus, technology has been
facilitator in helping the industry grow in India both in terms of increasing the potential
market size and increasing the market penetration.

Analysis of Task Environment on the basis of Porter’s 5 Forces Model:

• Threat of New entry: In the industry of customized t-shirts, there is little that is unique to
bring to the table in Tier I or Tier II Indian cities, so this force is also somewhat small there.
However, new entries might find unique ways to popularize their own products and as such
build novel brands. In this sense, the t-shirt industry is a very difficult one to get into unless it
focuses on a unique idea. The industry in its current state is ‘high risk, high reward’ for new
entrants.
• Threat of Substitution: Other forms of apparel such as shirts and kurtas are the substitutes
for the T-shirt industry. These clothes pose a low threat as the segment of t-shirt is

MMT Assignment 10 IndiGene T-Shirt

 continuously growing. As our product aims to satisfy the emotional needs of the customers,
the substitutes which have more of a functional value will not affect our business.
• Competitive Rivalry: There are large numbers of retailers who sell t-shirts in the local
market. These local market players pose a potential risk for us. Apart from this, the major
online t-shirt sellers also pose a great risk to our business.
• Buyer Power: Buyers have many alternative locations to shop for t-shirts and little incentive
to stay with one particular company, giving them plenty of direct bargaining power. The
pricing and quality are must have attributes of the t-shirts. Any deviation in these aspects will
compel the buyer to exercise their power to choose the competitor products. So, IndiGene T-
Shirt ensures these features along with additional attraction of local pop culture to retain the
buyers.
• Supplier power: For us, the t-shirt manufacturers in Ahmedabad and Vadodara are our
suppliers who will supply us with plain t-shirts. In this industry, Supplier power is a
relatively small and insignificant force. Most t-shirt companies source their products from
manufacturers who receive just fractions of the profit. Suppliers have little control over this
industry. Unfortunately, they are dispensable and can always be swapped out because
technically value addition doesn’t take place at their level. As a result, input prices for this
industry are relatively low and will stay there.

MMT Assignment 11 IndiGene T-Shirt

 4. Competition Analysis

To understand the competitors’ canvas for the t-shirt industry, it is important to look at the
market competition from national and local perspective. The t-shirt industry in India has been
revolutionized by the online retailers in the recent past. This has led to substantial differentiation
of offerings in relatively small industry of t-shirts which has created a competitive environment.
As per the surveyed data, our competitors include online t-shirt sellers and retail market shops.

Points-of-Parity and Points-of-Difference

The functional value of our product is the same as all T-shirts available in the market. The
material used and quality of t-shirts provided by the competitors is at par with ours. Choice of
sizes and varieties are also similar. The non-availability of desired choices of the prints available
in the market and lack of local culture references is what sets IndiGene T-Shirt apart. The local
culture which we are targeting is the differentiating factor for us since no major player in the
market provides the t-shirts with local references currently. The printing technology is also a
major difference at IndiGene T-Shirt. The vacuum heat pressed machine is presently used
machinery employed to produce the printed t-shirts, but we are using DTG or Direct to Garment
printing technology which ensures high quality and longevity of the print.

Analysis of Competition on the basis of SWOT Model

SWOT analysis would further help us in understanding the competitive environment and where
does IndiGene T-Shirt draw the competitive advantage from.
• Strengths: T-shirts which have become a tool to express oneself, draw their value from the
emotional utility more than the functional utility. IndiGene T-Shirt focuses on offering value
to the customers by catering to their cultural and psychological needs in personal and local
context.
• Weakness: IndiGene T-Shirt caters to only limited geographical market.
• Opportunity: After successful implementation of business model, IndiGene T-Shirts has
opportunity to expand this model to cater cultural and psychological demands of other tier 2
& tier 3 cities in India.
• Threats: Low entry barriers in this industry, any new market player can enter the market and
disrupt the segment that we have targeted. Any merchandise with printed local references is

MMT Assignment 12 IndiGene T-Shirt

 also a competition to the company. Plagiarism of the tee-shirt print is also a threat in this
business.

Perceptual map

The perceptual map for the competitors in the T-Shirt industry in India is shown below:

We used customization, pre-design, broad culture appeal and local culture appeal as four aspect
to analyze the competition. No companies provide customized as well as pre-design t-shirts with
high local culture appeal and we find market opportunity there to serve our customers.

We also tried to categorize the various sources of competition we can face:

• Direct sources - These comprise of all the T-shirt brands which cater to the same need as us.
This brings them to the domain of the emotional benefits that we are targeting and how our

MMT Assignment 13 IndiGene T-Shirt

 product will provide more targeted benefits to delight the customer. We do not intend to just
provide customer satisfaction but rather customer delight.
• Indirect sources - These include all the merchandize that provide the experience of
communicating local culture. Accessories, Badges, Bags, and other apparel provide
competition in the concept. Nonetheless, the medium is the advantage we are aiming at to
tackle this competition.
• Replacement - The products catering to the functional needs that apparel such as T-shirts
provide, are the ones that come under this kind of competition. This comprises other apparel
such as tops, shirts, and kurtas. Some people would not be particular about apparel except for
the core function they cater to. This audience might like to have a greater stock of other
apparel.

MMT Assignment 14 IndiGene T-Shirt

 5. Consumer Behavior

Studies clearly show that style, price, and followed social identity are the most pertinent factors
in explaining Gen-Y and Gen-Z consumer purchase behavior. In today’s time, apparel speaks to
the social needs of individuals. The desire to fit into the current trend, the fear of missing out and
the perceived need of being up-to-date with popular culture has given way to a large market; a
market for apparel, merchandise, and goodies. Among these the market for apparel is the largest.
Particularly T-shirts are a favorite due to low perceived risks and money-constrained lifestyle.
Our product is made of cotton and is affordable. This shows the low or negligible physiological
and financial risks, respectively. T-shirts are generally low involvement products. However, pop-
culture and local popular culture references turn them into objects of desire. Having local stores
and super markets in our channels gives us the advantage of reducing any apprehensions the
customer might have about the material, size, design, print quality and fit. This leads to greater
fulfillment of customer expectations. People buying online will have size metrics which will help
them pacify their concerns.

Customer Satisfaction is defined by the functional and emotional benefits divided by the costs.
The functional benefit associated with T-shirts is minimal. We attempt to increase value by
increasing the emotional benefit in the numerator and reducing the search, energy costs, and
price in the denominator.

Driving factors for consumer behaviour

• Cultural Factor: Across working class and above, students and working youth want to
accept the local culture in modern ways. The desire to stay in touch with roots without being
old-fashioned is a new disruption taking shape.
• Social Factor: The primary reference group of friends and co-workers play an important in
the apparel consumption pattern of individuals. Everyone wants to be part of certain
aspirational groups. T-shirts are a great medium of doing that.
• Personal Factors: The age and stage in life cycle that we are targeting love to flaunt their
personality and self-concept. Today, T-shirts tell about what resonates with a person’s traits.
A T-shirt can tell whether the person is intelligent or sophisticated by the quote, text, or
image the person chooses to wear. Essentially, it is not the T-shirt that is being worn but what
is present on the T-shirt. Sometimes, people may also choose their ideal self-concept, or even

MMT Assignment 15 IndiGene T-Shirt

 other’s self-concept rather than their actual self-concept while selecting apparel. Either way,
whichever aspect of the local culture resonates with them, is depicted though their choice of
T-shirt.

Most potential consumers we interviewed said they like to catch attention through what they
wear. As we know, selective attention is a persistent phenomenon in our lives, which we intend
to tap. We also intend to encourage the gifting culture in modern times through the emotions
attached with local popular culture. It helps us give an experience of a community-feeling and
solidarity even within compact groups. This glues the macro culture as well as micro culture
within the group.

MMT Assignment 16 IndiGene T-Shirt

 6. Segmentation, Targeting & Positioning (Strategic mix)

Segmentation

We have divided our market into a segment based on following factors:

• Geographic details: IndiGene T-Shirts is local pop culture t-shirt brand catering to the wants
of youth in tier 2 and tier 3 cities. With growing penetration of digital platforms in tier 2 and
tier 3 cities the concept of pop culture merchandise is gaining popularity. Essence of local
culture in medium size towns is still prevalent and there is significant demand for local pop
culture merchandise in these cities. IndiGene T-Shirts cater these local popular demands and
start its business with 5 tier 2 cities of western part of India that is Vadodara, Nasik, Pune,
Indore and Anand. Above mentioned cities are either major centre for education and
knowledge-based industries or near to famous tourist places, which provide large market of
youth for our product.
• Demographics: Our business demographics include 5 vibrant cities of the western part of
India in the age group of 15-29 years. According to 2011 census, 15-29 years age group
population constitute 26% of India’s total population. Based on the available census data our
geographic target market available in this age group is approximately 4157299. This age
group in recent times believes in spending a greater part of their disposable income on
consumption. The attitude is turning towards taking more experiences, buying more products,
rather than saving. Our product, along with functional value provides emotional attributes
and satisfies social and emotional wants of our customer.
• Psychographic: As each generation is profoundly influenced by the times in which it grows
up: the music, movies, politics, foods and defining events in an around, psychographic is
most crucial factor for our product. We conducted market research and try to provide pre-
designed T-shirts on the basis of personality traits, lifestyle or values. We use bottom up
strategy to know about local culture and inculcate this information to make unique products
for our customer.

Targeting
We propose to target only one segment of customers out of the various kinds of customers
available in the entire T-shirt market. Our target audience is composed of the wide range of ages

MMT Assignment 17 IndiGene T-Shirt

of customers ranging from 15 to 29 years of age. This is the young, enthusiastic and expressive
segment. This segment is also price sensitive due to lower income as they are in a particular
stage of their life cycle. Our low-cost proposition will be an effective proposition for this
segment.

Positioning
It is not necessary for a T-shirt to be positioned as just a T-shirt. It is the obvious state of it that
gives it away. However, we seek to establish our category frame of reference as vehicles of
expressing local culture and lingos. Our aim is to provide an emotional bond to the customer
through our USP so that we can maintain customer loyalty. This is to ascertain the avoidance of
becoming only an impulse-buying product. We believe that this category membership will give a
unique proposition to the customers and establish the awareness in the minds of the customers.

Branding

• Name: IndiGene refers to a person who has is a local of a particular place. Further, when we
segregate the terms, we get Gene as an independent word. Gene is a unit of heredity which is
transferred from a parent to offspring and is held to determine some characteristic of the
offspring. The name ‘IndiGene’ is derived from the qualities of the product which assert the
importance of maintaining these characteristics. The term has a social connotation where it is
believed that social demeanor is a function of biological traits. Hence, we uphold
individuality in the process of accepting local culture.
• Logo: Our logo has the upper portion of a tree as a DNA strand.
This shows individuality while the roots of the tree signify the
origins, place where one comes from, and all the experiences that
they have had there.
• Color: Dark blue color is associated with depth, expertise, and
stability. We chose this color to represent our brand as we want to
internalize the effort to make a long-term relationship with the customer.
• Tagline: Our tagline is ‘Locally You’. This will help us align our proposition keeping in
mind the requirements of the customers. It helps the customers to understand that their
identity is also of importance to us. We want to act as facilitators of linking local culture to
the customer which was earlier not catered to by the market.

MMT Assignment 18 IndiGene T-Shirt

 7. Pricing and Promotion

Pricing Strategy

Three pricing strategies were considered to price the product:

• Cost-plus pricing: In the t-shirt industry, the products are priced with a general mark-up of
90-100% over the cost of production. Using the same benchmark, the price of the t-shirt is
determined by taking a 90% over the sum of direct material cost, direct labour and overhead
costs
• Reference pricing: The competitors of IndiGene T-Shirts sell their products in the range of
Rs. 250 – 500 on the online and other platforms. A premium of Rs. 50 is added to the lower
price of this band for the exclusivity of the print design. The lower price is chosen so that
customers embrace our product and conform our product offering claims. This price also
keeps us in the competitive environment.
• Perceived-pricing: As per our survey, the potential customers are willing to pay up to Rs.
500 for a t-shirt which is being offered by us. While 57% of the respondents voted to the
range of Rs. 250-500, it is apt to price the product at Rs. 300.

The safest way to go would be to use the maximum market share objective to keep in mind while
proceeding with the pricing strategy. However, we do not wish to form a perplexed image in the
minds of the customer. Lowest prices would help generate the push factor but we wish to go
forward with a pull perspective. We are accommodating the audience which is price insensitive
in the range of Rs. 300 to Rs. 500. This information has been extracted from the online survey
we conducted. Our objective for going about the pricing is to establish ourselves as a quality
brand which is affordable by the customer without giving the idea of a cheap product.

MMT Assignment 19 IndiGene T-Shirt

Promotion Strategy

In order to spread awareness and create a brand recall it becomes important to consider the
promotional strategy as the crux of the plan. We aim to use various channels to promote our t-
shirts in the market.

• Digital Media Marketing: Digital Media has become a highly used form of marketing in
past few years because of high penetration of internet and also social media. Social Media
plays a big role in influencing the buying decisions of customers. Therefore, we will use
digital media to promote our t-shirts and create awareness. We aim to do so by tapping into
social media platforms and using promotion packages offered by sites like Google (Google
AdWords, Google Video, etc.) Facebook, Instagram, etc. Apart from this we will tie up with
video bloggers who act as aspirational group for consumers. Also, consumers are able to
easily relate to these people and therefore, products endorsed by them are adopted by
consumers. We will then promote these videos on YouTube, Google Video and other social
media sites.

• Sales Promotion: Sales are the ulterior motive of any business and therefore, we aim to
emphasis on the sales by using sales promotion strategy. As a part of this strategy, we will
promote our t-shirts by deploying sales representatives in the cities aforementioned. These

MMT Assignment 20 IndiGene T-Shirt

 sales reps will further be responsible for promoting the t-shirts to dealers and distributers by
encouraging the trial and purchase. They will be responsible for understanding the culture
prevailing in the cities and what are the recent trends in these cities. Accordingly, we will
design the city specific t-shirts with the help of our designers. Thereafter, these t-shirts will
be provided to the dealers and distributers by these sales representatives. We shall take adopt
trade discounts and special release discounts, under which new released t-shirts will be sold
at discounted rates.
• Public Relations: We will use PR activities to communicate the brand value to the
customers. In order to do this, we will undertake marketing campaigns in colleges wherein
our aim will be to spread awareness about the local culture reference t-shirts and about our
offers. We will also partner with these colleges and publicize our product by sponsoring
during college events. We will act as T-shirt partners for these events and will also rent a stall
in order to promote t-shirts during these events.
1. Digital marketing
2. Marketing campaign in colleges and stalls
3. Tie up with video blogger
4. Sales force
5. T-shirts partner at college events

MMT Assignment 21 IndiGene T-Shirt

 8. Financials, Budgets and Forecasts

Sales Forecast
We have chosen 5 cities for our initial launch and for a period of 5 to 7 years we will be
operating in these cities only and also, we will be selling t-shirts online. On the basis of this we
have done the sales forecast. As per, Central Statistics Office data[6], we found out that 26.1% of
Indian population lies in the age group of 15 to 29 years of age. Therefore, we have considered
the total population of these cities and then considered 26.1% of population to be youth. Out of
this segment, 54% is our available market, as per our survey which shows that 54% of people are
interested in buying our product. Out of these people, we will target 55.6% people who as per
our survey purchase t-shirts in our price range. Considering our capacity, we will be able to tap
10% of these people, and the sales will grow at the rate of 5% YoY. Annexure 1 gives the data
for our sales forecast for next 5 years.

Expense Forecast and Break-Even Analysis

As per our plan, we will bear fixed expenses and variable costs which are shown in Annexure 2.
The fixed costs will be borne on Plant & Machinery and initial business setup whereas variable
expenses will be borne on things such as raw material, printing cost, packaging cost, etc. Also,
the technology used will be Direct to Garment technology which is sold at $13, 000/unit7.
Break Even Analysis can be found in the table given below. As per the analysis we will be able
to break even in 11 months and then after we will start making profit.

Particulars Value
Fixed Cost 16550000
Variable Cost (Per Unit Cost) 159.94
Selling Cost (Per Unit Price) 300
Break Even Units 118163.8
Sales in first year (Units) 124819
Time to break even (in months) 11.3602

MMT Assignment 22 IndiGene T-Shirt

 9. Control

Daily Sales Report

The sales representative will be required to update a daily sales report at the end of any business
day. The number of outlets covered by the representative and the conversion rate will be
recorded in the report. The SKUs to be restocked will be judged by the representative and will be
followed up the next day from the main distribution centre. Also, in order to monitor the pre-
launch activity wherein we try to build as many connections as possible, we will give targets to
our sales reps which will be to contact 200 dealers in a week and by the end of 2 months get at
least 1% of dealers on board and also 1 supermarket.

Management Information System

The availability of stock at the various POS and the inventory level of raw materials will be
monitored by the SAP (Management Information System). Data will be updated and monitored
on regular basis so as to avoid stock-out situation. It will also help us in forecasting the demand
for a particular design.

Feedback Mechanism
We will take feedback from customers after their purchase to understand their future
expectations and also to know about their satisfaction level with the purchase. We will also take
feedback from our business partners about the demand of the products and brand recognition.

MMT Assignment 23 IndiGene T-Shirt

 10. Implementation

We will implement our plan in 3 phases:

• Prelaunch Phase: Pre-launch phase will be for a period of 2 months. During this phase we
will focus on the below mentioned activities: Building the team and choosing the roles with
key responsible areas. Training and communicating the objectives of the company to the
team will be an important aspect. This will be followed by building the connections and
establishing the distribution channels in the chosen cities and with e-tailers.
• Launch Phase: During this phase, we will launch our product in the 5 cities which is our
target market. We will carry out the launch in these cities in 5 consecutive days. Launch
events will be held on famous places of these cities where in we will promote our t-shirts by
selling at discount rates of 50%. Also, we will try to launch in Supermarkets where the
footfall of shoppers is comparatively higher. We will keep the promotional discount offers
for first 100 buyers in order to grab attention. Events will be created on Facebook which we
will promote in the city specific social groups.
• Post-launch Phases:
1. Phase 1 – 6 months: The demand forecasting models will be tuned to understand the
consumer behaviour and to optimize the operations of the company. The relation with the
business partners or the retails/super markets mangers will be developed and efforts will
be made to retain them. The online environment is to be setup during this time. The
promotion in the digital space should ensure that the online sales target of 10% is
achieved during this period.
2. Phase 2 – 1 year: The new targets for the sales representative would be increased to – 2
super markets and 40-45 retailers in each city. Sales and distribution channel would be
strongly established in the selected cities. The scope of extending the model to other tier-
2 cities would be studied.

MMT Assignment 24 IndiGene T-Shirt

 11. References

1. https://economictimes.indiatimes.com/articleshow/63955655.cms?utm_source=contentofinterest
&utm_medium=text&utm_campaign=cppst
2. http://www.technopak.com/Files/T-Shirt-Market-in-India.pdf
3. https://www.credenceresearch.com/report/t-shirt-market
4. https://www.power2sme.com/smekhabar/General/4362/MSMEs%20in%20Tier-II%20and%20Tier-
III%20markets%20records%20faster%20growth%20than%20Tier-
I,%20shows%20a%20study%20by%20Instamojo%20
5. https://fashionunited.in/news/retail/indian-s-per-capita-spending-on-apparels-on-the-
rise/2017051215217
6. http://mospi.nic.in/sites/default/files/publication_reports/Youth_in_India-2017.pdf
7. https://www.ricoh-usa.com/en/products/commercial-industrial-printing/industrial-printing/ri-3000-
ri-6000
8. https://www.emeraldinsight.com/doi/full/10.1108/JFMM-01-2017-0002 (Access date - 07
Jan. 2019)
9. https://goo.gl/forms/MlPB4AiSokYJsM5B3 - Google form to collect primary data
10. https://www.census2011.co.in/census/city/335-anand.html - Census of Anand and Gujarat
(Access date – 07 Jan. 2019)
11. www.gtu-info.com/top-engineering-colleges-in-gujarat - Demographics study (Access date –
07 Jan. 2019)
12. www.collegedunia.com – Demographics study (Access date – 07 Jan. 2019)
13. https://amazingamdavad.in/ - Competitor analysis (Access date – 07 Jan. 2019)
14. https://www.thesouledstore.com/ - Competitor analysis (Access date – 07 Jan. 2019)
15. https://www.redwolf.in/ - Competitor analysis (Access date – 07 Jan. 2019)
16. https://www.bewakoof.com/ - Competitor analysis (Access date – 07 Jan. 2019)
17. https://www.almamaterstore.in/ - Competitor analysis (Access date – 07 Jan. 2019)
18. https://www.1469workshop.com/ - Competitor analysis (Access date – 07 Jan. 2019)
19. Philip Kotler and Kevin Keller, Marketing Management 15th Edition

MMT Assignment 25 IndiGene T-Shirt

Annexure 1 : T-Shirt Samples
Annexure 2 : T-Shirt Printer
 Annexure 3: Sales Forecast

Age Group Population

15-18 Age group 126218
18-24 age group 122942
25-29 age group 117725
Total Population 1403882
Percentage of youth 26.13%

Cities Population
Nashik 2270000
Pune 6772000
Vadodra 2065771
Anand 288095
Indore 4512000
Potential Market (26%) 4157299.13
Available (54% as per survey) 2244941.53
Target Market (55.6% as per survey) 1248187

Particulars Year 0 Year 1 Year 2 Year 3 Year 4 Year 5

Sales forecast 124819 131060 137613 144493 151718
Revenue Forecast 37445625 39317906 41283801 43347991 45515391
Capital Exp -16050000
Marketing Expense -500000
COGS 19963537 21485228 23127463 24899945 26813165
Contribution 17482087 17832677 18156338 18448047 18702226
Depreciation (@10%) 1085000 1085000 1085000 1085000 1085000
EBIT 16397087 16747677 17071338 17363047 17617226
Taxes (@30%) 4919126 5024303 5121402 5208914 5285168
EAT 11477961 11723374 11949937 12154133 12332058
Cash Flows (EAT+Dep) -16550000 12562961 12808374 13034937 13239133 13417058
NPV of project 32623091.48
 Annexure 4: Cost Projects and Break Even Analysis

Fixed Assets Amount

Machinery 1,00,00,000 Inflation 1.03
Lease-in-land 42,00,000 Cartridge cost (500 prints) $287
Furniture 7,00,000 Online sales 10%
Electrification & other fixtures 5,00,000 Online cost per unit 40
Bar-code Machine 1,50,000
Office Setup 5,00,000
Total Fixed Cost 1,60,50,000

Variable Cost 1 2 3 4 5
Raw Material (Units) 124819 131060 137613 144493 151718
Raw Material Cost 12481875 13499148 14599328 15789174 17075991
Printing Cost (Cartridge) 4992750 5399659 5839731 6315669 6830396
Packaging Cost 249637 269983 291987 315783 341520
Wages 840000 865200 891156 917891 945427
T-shirt Designers 360000 370800 381924 393382 405183
Sales Rep 540000 556200 572886 590073 607775
Online expenditure 499275 524239 550451 577973 606872

Total Variable Cost 19963537 21485228 23127463 24899945 26813165

Per Unit Variable Cost 159.94 163.93 168.06 172.33 176.73

Particulars Value
Fixed Cost 16550000
Variable Cost (Per Unit Cost) 159.94
Selling Cost (Per Unit Price) 300
Break Even Units 118163.8242
Sales in first year (Units) 124819
Time to break even (in months) 11.3601995