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Titan Industries: Strengthening customer loyalty news 29 September 2010 22nd Qimpro Convention :Titan Industries Ltd Titan won the award at the 22nd Qimpro Convention for devising a unique customer relationship programme that led to customers bonding with the company emotionally. Titan Industries Limited, incorporated in 1984, is a joint venture between Tata Industries and Tamil Nadu Industrial Development Corporation Limited (TIDCO). The company's jewellery division manufactures and retails 18 karat studded jewellery and 22 karat plain gold jewellery under the brand name Tanishq. The company's Ananata-Customer Loyalty Programme is unique to retail and the industry, indeed, to any industry in the world as it is aimed at connecting emotionally with customers. Every customer is considered a unique entity under the programme, which is a loyalty programme that does not bank on giving incentives to customers to buy more. On enrolling a customer in the programme, the company captures extensive details about customers and their families under broad categories - customer data, customer feedback and most importantly the customer's preferences and that of his family in various fields to capture the likes, passions, family occasions and other "happy" occasions. The programme creates an opportunity for customers to be associated with the 'Big Family' and make them spokespersons of the brand. The details captured are then entered into the special software that was developed for the company and the database with information about all the customers helps the company reach out to the customer in many personal and meaningful ways. The tangible benefits of the programme have been: * Customer retention and growth by 33 per cent * Word-of-mouth promotion increased from 17 per cent to 38 per cent * Repeat purchase within 3 months is 14 per cent * 50 per cent total sales has been attributed to the loyal customer The intangible benefits of the programme have been: * The family members (Ananta customers) assume various roles for the brand like addressing gatherings or events on behalf of the company's jewellery store -- Goldplus. * The programme has created a huge impact on customers * Customers visit underprivileged children and spend time with them apart from monetarily helping them in certain cases * Family members who include professionals like doctors help in conducting free eye camps
* New relationships are forged that go beyond business * Value addition in the lives of the family members of customers .
they understand the Asian culture and markets and that focusing on this part of the world can yield huge returns. last year but it did not work out. and Kuwait) followed by South East Asia and the SAARC nations are where the company is placing its biggest bets. The GCC accounts for two-thirds of Titan's international business.S. it has been launching new collections from its portfolio and strengthening its advertising and retail presence. We plan to invest in building our brand in select markets in Asia. Bhat's team has a two-pronged strategy. it is no longer targeting just the Indian diaspora in the GCC but also other expats and local residents of the Emirates.that's the slogan for international growth at Titan Industries. In the Middle East it was not profitable and in the U. Oman.200 points-of-sales across the GCC. Our international strategy now is to focus only on watches and only within Asia. Titan's logic is simple: Much of the world economy is expected to be driven by Asia in the coming years and Titan executives believe that being part of an Indian company. Titan has sharpened its focus.Suggestions to strengthn the brand Only Asia -. First. Bhat's mandate to his team is to increase this to 10% especially in markets like Dubai and Saudi Arabia over the next five years. Titan has decided to focus only on watches. In line with this. comprising the United Arab Emirates. emerging as the Indian watch-maker's sweet spot. These . Bhaskar Bhat. "At present our international sales are around $25 million but we see a huge potential for growth. it is moving up the value chain from the mid-market segment ($40 to $80) where it has been traditionally present to the mid-premium segment priced at around $80-200. The Gulf Cooperation Council (GCC. Our target is to increase our international revenues five times over the next five years. Second. Even within Asia. Bahrain." explains Bhat." says Titan's managing director. At present Titan has a low 3% to 4% share across the GCC watch markets. Titan also has a jewelry business that accounts for some 70% of sales. Qatar. For international markets." With revenues of nearly $850 million. To enable them to meet this target. Titan watches are sold in more than 1. Bhat has tripled their marketing budgets from 5% of net sales to 15%.S. India's leading watch manufacturer. our timing was wrong. however. "Asia is going to be the big story for the next 10 years at least. "We did try with jewelry in the Middle East for a few years sometime ago and also in the U. Saudi Arabia. and a fledging eye wear business which it entered a couple of years ago.
"Apart from Dubai. Rado and others priced more than $250. hypermarkets. Swiss Star and others. The GCC watch market is estimated to be around 20 million to 25 million watches and growing at around 5% annually. Bhat recalls that Titan's international move was propelled by three considerations: The Indian market itself was very small. and that success in the international markets would enhance the brand in the domestic market also. The rest is accounted for by a host of local and international brands. The Middle East -. unlike in the mid-1990s when Titan had to build an entirely new product line for Europe.because of its proximity to India. Rolex. its familiarity with Indian brands and large Indian diaspora -." he adds candidly. vice president and global business head. the company now has a portfolio of products and can pick and choose the relevant ones for different markets. It was the watchmaker's first foray outside India. . for its European foray Titan went the whole hog. "The entire European foray was driven more by pride and prestige rather than business considerations. Then comes the mid-premium segment comprising the upper end range from players like Citizen. We want to be accessible with our new products to both our existing customer base and our new target customers. This market is flooded with brands . Unlike the Middle East where it put products from its existing range. introduced steel watches unlike the gold-plated ones it had for the Indian market and also set up a separate manufacturing plant in India. Titan's global marketing head. Also. Titan has been more cautious in the GCC region. The company failed to make an impact. The issue of country of origin also proved difficult to crack. West Star. It also opened offices in London and Paris. it shifted focus and entered Europe. the modern retail story in the Middle East is yet to evolve and as that grows we also expect to grow with it." says Ajoi Chawla. At the top of the pyramid are brands such as Omega. Time to Market Titan entered the GCC market in the early 1990s and positioned itself in the mid-market segment. department stores. Citizen. including cheap Chinese imports.include multi-brand outlets. The economics just did not work out. The company has been following an incremental and profit-oriented approach. To cater to the European taste Titan roped in European designers.both big international names as well as local players. hired an advertising agency in London and launched simultaneously in 11 markets in Europe.was a logical destination. with liberalization it was imminent that global players would enter India and Titan needed to learn how to compete with them. Swiss watches are very popular among watch buyers in the Middle East. "We went with a very clear vision to make a mark in the most evolved watch market across the globe but we did not correctly estimate the investments that would be required. Europe proved to be disastrous for Titan." says Suparna Mitra." she adds." recalls Bhat. Seiko and some fashion brands followed by the mid-market range from Seiko. suffered huge losses and finally pulled out of that market in 2002. malls and so on. Having learned its lesson in Europe. "Our focus now will not be just on increasing the numbers but strengthening the quality of our retail presence. Even as Titan was learning the ropes in the Middle East. "We decided that we must first build adequate volumes and the business must generate funds which in turn will fuel growth.
However unlike India where Titan has multiple brands for different segments (the flagship brand Titan. an Al Futtaim group company and Titan's distributor in Qatar says: "Titan has excellent designs and its product launches are more frequent now than in the past. "Success in the region is a long-haul game.Titan is present in the GCC through exclusive distributors . needs a focused plan that is based on understanding the psyche of the local market and what moves it. Adds Bhat: "To be successful in the Middle East market the product has to be highly differentiated. he says. Chawla explains. "In the Middle East market the top end is serviced adequately by a host of international brands but there is certainly space in the mid market that Titan can address profitably by expanding its range. Santosh Desai. The company also needs to loosen its purse strings. Al Hussaini. agrees. CEO of Harish Bijoor Consults and visiting professor at the Indian School of Business in Hyderabad. youth brand Fastrack. the top end Swiss-made Xylys and budget brand Sonata) in the Middle East markets all of Titan's offerings will be under the Titan brand. The reason. Titan. According to Chawla. The environment in which it is presented needs to be very appealing. Harish Bijoor. These include non-Indian expats and locals with special focus on the youth and women. retail and watches are a very small part of their business but we have chosen to go with these big players because of their reputation in the market and their ability to help open doors which an outsider may otherwise find difficult.one each in every country. "Also.S. Bahwan. As a conscious strategy." Distributors believe that Titan has what it takes to be big in the Middle East market." he notes. is that India Titan is the market leader and in order to grow further it is critical for the company to grow the category. the designs and of course the price. though. CEO of Future Brands believes that Titan is on the right track. "I believe the Middle East market offers Titan opportunity as the product quality on offer is a true-blue international quality that can compete with most brands already available and popular in the market." he adds." Desai adds that Titan's decision to focus on Asia makes more sense than its foray into Europe. and Al Futtaim. Says Desai: "Distributor partnerships are crucial in the Middle East. For the future. "For some of our partners like ETA. Local knowledge is very important. sales manager at the watch division of Doha Marketing Services Company. the focus will be on targeting and building brand relevance among new target groups. general manager. Titan has opted to go with big names in the region though not necessarily in the watch category. He points out that in the Middle East the local retailers have a lot of power and it is therefore imperative for Titan to have strong distributors. Titan's focus in the past was on establishing its brand presence in the region as a serious player with reliable products. head . he adds. and spend more on advertising and marketing than it does. is a highly evolved market with a slew of brands and Titan therefore needs to have a more focused approach. The Middle East. Ghai. Its distributors include groups like ETA. With a vast product portfolio for the India market Titan can choose those relevant for the GCC market." says Chawla.international business. Merril Dias." . He adds a caveat. unlike the 'emotional connection' that we are focusing on in the domestic market in the GCC we will be focusing more on the newness on the products. on the other hand. It is important for Titan to capture every segment of the population. for instance. It also has proactive consumer and dealer promotions which are comparable to others in the market." he says.' explains K.
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