The Titan Story

Early 2001, when Indian consumers rated Titan ahead of all other brands as the Most Admired Brand in India across all product categories (the first ever such survey done by Brand Equity), it did not surprise people that a 13 year-old had managed to upstage many older and more well-known brands: it was expected of Titan to achieve such things, it was so natural.

It was also a fitting tribute to a brand, which had not only revolutionised the Indian watch industry, but also brought in world-class benchmarks in product design, quality and retailing into India.

Back in the early eighties, the Tata Group had identified the watch category as a potential consumer market for the Tatas to enter. Xerxes Desai, a Tata veteran and the then MD of Tata Press, was chosen to lead that venture.

In those days of pre-liberalisation the watch market, like most consumer markets in India, was way behind the rest of the world. The technology in vogue was the reliable, but outdated "Mechanical" technology, which used the unwinding of a mechanical spring to tell time. Not only was the accuracy of time-keeping not good enough, but the bulky mechanical movement did not permit the creation of sleek products. The industry was dominated by the public sector which had brought in watch manufacturing into India, enjoyed tremendous goodwill in the market, but had not really invested in evolving itself and its consumers: styling still remained basic, choice was limited.

The watch shops were narrow, dingy and typically located in the older, traditional markets of the city. You went there only to buy a watch, never to browse, never to simply check out. Visual merchandising was very much at the stage of "decoration" if any, and neither the brands nor the retailers saw it as important. The

companies themselves did not have much contact with retailers, preferring to sell through wholesalers, doing well that way. There was hardly any need for consumer contact or research. It was a sellers' market.

All this affected the consumers. Watches remained a time-keeping device, so one watch was enough, thank you. Since the quality of the watch was quite good, it lasted quite a while, and the consumers did not change it for 10, 15, 20 years. And when they did change it, they did not pay a high price for the new piece because, what the hell, they were buying another time-keeping device.

Xerxes Desai's vision was to dramatically alter this perception of consumers, and make Titan a fashion accessory. He knew that that was the only way that this new brand would explode the market and wrest control from the dominant HMT. So he and his team went about breaking all the rules in the category:

Mechanical technology was the norm - Quartz had not really taken off in India. Titan would go against that and build its line based on quartz. Accuracy would become a selling-plank.Styling was basic - This was a constraint imposed by the technology as well the outlook of the manufacturers. Titan decided to make style a table-stake.Choice was limited - You had 200 models to pick from, that was it. Titan decided to inundate consumers with a wide choice in style, functions and price. The initial range was 350 models.Shops were dark, dingy and uninteresting - There was no importance given to presentation, and therefore no attempt made at it. Titan brought in the concept of retailing into the watch market, established a network of fine showrooms which would later become the world's largest network of exclusive watch stores. These stores not only helped Titan to gain leadership substantially, but also irrevocably altered the retail landscape of the

watch market through a demonstration effect on the traditional dealers.Advertising was expenditure - Titan saw this as a vital investment. Right from Day 1, Titan invested significantly in advertising and in that process created a set of memorable and effective properties over the years.

So Titan, backed by world-class quality created at a world-class plant located just off Bangalore, backed by the Tata name, was launched into the Indian market on the back of these new rules. It created waves right in the early days, mesmerised consumers, demolished competition and rode into the sunset with panache.

Today, in early 21st century India, it is taken for granted that a watch is a fashion accessory. Titan dominates the market, with a 60% share of the organised sector market (the total market, including the unorganised sector, is estimated at around 42 million units). Titan's quality record is impressive, its sales and service network is wide and deep, and its network of exclusive showrooms, The World of Titan, is one of the most prestigious and visible retail brands in the country, offering world-class levels of shopping comfort and customer service.

What is truly amazing about Titan is the sheer scale of its offering and the consequent choice it offers to multiple segments across taste, age and economic background. Titan saw this approach as the foundation of its leadership strategy in the early days. Even the early range had distinct offerings for different requirements: formal watches (gold plated cases with fine leather straps) for the executive, dress watches (gold plated cases with ornamental gold plated bracelets) for those with a preference for jewellery, rugged watches (all steel watches with a skew to functionality) for those whose usage demanded a certain durability.

Titan has built on this principle over the last 15 years, almost year after year:

In 1989, it was Aqura, the trendy range for the youth, colourful, smart and affordable plastic watches for the youth: The other side of Titan for the other side of you.

In 1992, it was Raga, the ethnic range, with striking symbolism from ethnic India, for the sophisticated India woman who appreciated such things.

In 1993, it was Insignia, very distinctive and international-looking top-end watches, for those seeking exclusivity and status.

In 1994, it was psi 2000, rugged, sporty and very masculine watches with serious sports features (200-m mater resistance, high precision chronographs) for those with the penchant for adventure.

In 1996, it was Dash, the cute and colourful range for kids.

In 1997, it was Sonata, the affordable, good quality range for the budget-conscious.

In 1998, it was Fastrack, the cool, trendy, funky range for the young and young-at-heart.

In 1999, it was Nebula, the sold gold and diamond-studded range of luxury watches for those affluent people to whom gold is a precious acquisition.

In 2001, it was Steel, the smart and contemporary collection for the young 21st century executive.

And in 2008, the brand has collections like the Octane, Diva, WWF and Zoop - each of them unique and fascinating.

The underpinning of this entire market development and segmentation is Innovation. Titan has kept innovation core to its strategy, realising fully that the only way to sustain the fashion accessory perception is by

continuously coming out with collections that make the current ones somewhat dated, thereby creating a certain discomfort in the consumers' mind, which leads to another purchase. This impact has shown up in every one of the collections spoken of earlier. They were fresh and distinctive, unlike what consumers had seen before, and thus created curiosity, walk-ins and sales.

A stellar example of Titan's Innovation is Edge, the slimmest watch in the universe. Titan's R & D talent created a wafer-thin quartz movement, a mere 1.15mm thin, over 4 years of development work. The immensely talented Design team collaborated with the Manufacturing group to create Edge, a 3.5-mm watch, a gem of elegance, with water-resistance to boot! Edge was launched in India early 2002 to tremendous market acclaim and sales success. It is a design and technological marvel, which justly received the Best Design Award in the Lifestyle Product Category in the first annual design contest organised by Business World and NID.

Titan also chose to invest heavily into showcasing all this innovation to the consumer through advertising. From Day 1, the 'catalogue" advertising of Titan became its trademark as it was used regularly and effectively to merchandise new models. The catalogue ads also helped customers to shop off the page and almost decide which model they wanted to pick. Retailers also became used to seeing customers walking into shops with newspaper "cuttings", asking for the models shown there. This approach continues to this day, with mostly the same effect.

In the early nineties, Titan chose to develop the "Gifting" market. Watches had always been favourite things to gift, and Titan had benefited from that. Titan was convinced that there lay a greater potential in that segment. A set of 3 films were developed in 1991 around 3 relationships, where the gifting of a Titan

culminated in a moving personal moment and a strengthening of the bond between the protagonists. These films became a big hit and created a genre of advertising films which lasted a good 8 years. During those years, a series of films involving a variety of characters (father, daughter, teacher, boyfriend, ex-boyfriend, thief!) and with local flavour (for Onam in Kerala, Puja in Bengal) were created and released. These not only helped build a good-sized gift segment for Titan, but also became Titan's Theme Campaign, building strong emotional values for the brand. One of the films in the series, where a man and his younger daughter conspire to give his older daughter a Titan as a surprise gift at her wedding, released around 1994, went on to become the most popular Titan film ever, even voted by the viewers of Zee Television as the second most liked TV commercial on the channel.

The most enduring part of the Titan advertising has been the music track. Chosen by Xerxes Desai and the creative head of O & M in 1987 for its class and western vibes, the segment from Mozart's 25th Symphony has arguably become Indian Advertising's most memorable track (incidentally, and perhaps not coincidentally, this was the most liked advertising track in the same Zee TV survey). Starting in 1987 in its pure classical versions, with a single violin playing the melody, this piece has been rendered in countless innovative versions over the years: Indian Classical, Indian Folk, Operatic, Rock, Funk,.And has become such a powerful audio mnemonic for the brand.

Another successful customer-facing aspect about Titan has been its stores. Organised retailing did not exist in the late eighties. The concept of exclusive brand stores was almost non-existent. In a pioneering effort that dramatically altered industry standards, the World of Titan was born. Located in the newer parts of a city, with a good frontage and layout, the showroom

immediately stood out on the street and attracted walk-ins. Once inside, you were totally impressed with the presentation. You walked along the wall, where recessed "mood windows" showcased specific collections in the appropriate context with the help of visuals, decorative props and word (the place looked almost like an art gallery). You could get a better idea about that collection through such a contextual presentation and could make up your mind which collection was right for your requirement. Then you would walk along to the selling area, where the entire range was displayed in style. Smart and helpful salespeople waited on you there and helped you choose the best piece by giving you information and suggestions. You walked away overwhelmed.

This experience now has over 255 branches and has penetrated the width and breadth of India. Helping the brand increase sales, increase price premium, sell the more expensive watches, improve image, keep competition at bay and keep the brand name salient on the high streets of the country. Refurbished with a contemporary look in 2001, this chain has become even more integral to the brand's destiny today.

Doing all this in style has earned Titan enormous goodwill and respect. Titan was voted the Most Admired Brand (across categories) in India by consumers, in the first such study by Brand Equity done in 2001. Titan was voted the Most Admired Consumer Durables Marketer by industry professionals, 8 out of 9 times (the ninth time it was No 2), in A & M's annual survey done between 1992 and 1999. Titan was voted the Most Respected Consumer Durables Company in a Business World Survey in 2003. Consumers and professionals alike have resonated equally to Titan's successful efforts in bringing international standards to India. And in 2008, it emerges as the 24th Most Admired Brand in the ET Most

Admired Brands survey done annually, it was also the most admired Consumer Durable brand.

Titan has also done the seemingly impossible reverse thing: taking Indian quality to international markets. Since starting export operations in a small scale to the Middle East in the early nineties to exploit the resident NRI population, Titan has come a long way. Moving into the European market in the mid-nineties and Asia Pacific in the late nineties, Titan today sells in the UK, Spain, Portugal, Greece, Singapore, Dubai, Malaysia, Oman, Philippines and many more countries. The customers are no longer only NRIs. They are the Thais, the Greeks, the Arabs, the Filipinos - through a combination of Contemporary Style, Great Quality and Great Prices, Titan has put together an irresistible proposition for the people of these countries. With over 100 million satisfied consumers and a track record of breaking the rules, Team Titan faces the 21st Century with a mix of passion, excitement and energy.

HOW DID THE TITAN MUSIC ORIGINATE

The idea of using the flamboyant third movement from Mozart's 25th Symphony in G minor, written when Mozart was only 17 years old, came from Suresh Mullick who was O & M's creative head in 1986 when Titan's first TV campaign was being planned. Mozart's symphony had already been immortalised for contemporary non-cognoscenti in one of the greatest movies of our time, AMADEUS, which was released in 1984.

The music was such a resounding success that it was never ever dropped, and no thoughts were ever entertained of making a change.

But the original score did go through numerous metamorphoses as it was rendered with musical instruments that Mozart could not have even heard of, leave alone heard. Perhaps it is in the nature of great

and enduring music that it can be adapted to such a variety of powerful visual images united only by a single mood and message.

The music was singularly appropriate: it exuded enthusiasm and energy, flamboyance and power, tenacity and triumph. It was young and full of zest, typical of the composer himself. Yet it was classy and elegant. And, of course, it was very European. Both the music and the man who wrote it perhaps the greatest musical genius of all time had all the right connotations and fitted so very well with the character of the brand and of the organization that we were seeking to create.

Titan Industries is the world's fifth largest and India's leading manufacturer of watches. The company has manufactured more than a 100 million watches till date; and has a customer base of over 80 million. The umbrella brand Titan is one of India's leading watch brands that brought about a paradigm shift in the Indian watch market, offering quartz technology with international styling.

The brand Titan is committed to offering its consumers watches that represent the compass of their imagination. Titan's customers are therefore consistently introduced to exciting new collections, which connect, with various facets of their deep−rooted yearnings for self-expression. The new brand philosophy of Titan, encapsulated in the words "Be More", touches this as well as all other aspects of the brand.

The Titan brand architecture comprises several collection and sub−brands, each of which is a leader in its segment. Notable among them are: Titan Edge The world's slimmest watch which stands for the philosophy of "less is more"; Titan Raga the feminine and sensuous accessory for today's woman, Nebula − crafted in solid 18k gold and precious stones. Several other popular

collections like Heritage, Aviator, Regalia, Octane & WWF also form a part of the Titan wardrobe.

Today, the Titan portfolio has over 60% of the domestic market share in the organised watch market. The company has 247 exclusive showrooms christened World of Titan', making it amongst the largest chains in its category backed by 700 after−sales−service centers. The company has a world−class design studio that constantly invents new trends in wrist watches.

Fastrack was launched in 1998 as a sub-brand of Titan. It was spun off as an independent brand of watches targeting the urban youth in 2005. Since then, it has carved a niche for itself with designs that were refreshingly different and affordable. During that time, Fastrack also extended its footprint into eye gear and in the last 4 years has quickly notched up the title of being the largest sunglass brand in the country.

Fastrack has now chartered into newer categories – bags, belts, wallets and wrist bands – as part of its vision to become a complete fashion brand for the youth. With enough categories to fill up one cool store, Fastrack has ‘moved on’ to open its own stores for its young consumers. The store is positioned as a complete accessories destination with all Fastrack gear under one roof. The first store was opened in Pune in 2009. Fastrack plans to have 100 such stores by 2011.  

INTEGRATED SUPPLY CHAIN MANAGEMENTTitan changed the way watches were designed, manufactured and marketed; Titan revolutionized the Indian Watch Industry.

Titan watches, the most trusted and popular watches in India, are manufactured at Hosur, an Industrial suburb of Tamil Nadu, India. Set up in 1985, with initially planned annual capacity of 2 million, today the unit produces over 11 million quartz analog wrist watches, thanks to the state-of-art manufacturing facilities at the unit.

Titan Industries’ Movement Manufacturing set-up was established in technical collaboration with France Ebauches, a leading quartz analog movement manufacturer in France. The Case Manufacturing set-up was based on an alliance with Citizen Watch co, Japan. In 1989, watch case manufacturing technology was obtained from Citizen Watch Co. of Japan and in mid 90s, the technology for complicated watch cases and solid link bracelets manufacture was obtained from a Swiss company. Sheet metal bracelet manufacturing facility was established in 1996 with the help of a company in Japan.

A Watch Assembly unit was established at Dehradun in 1990 and another two units were added: one at Baddi, Himachal Pradesh (2004) and the other at Roorkee (2007). Today, Titan Industries' watch assembly capacity is about 10 million watches per annum.

Titan Industries is one of the very few manufacturers in the world that manufacture watch movements, watch cases and metal bracelets under one roof. It is the fifth largest, integrated watch manufacturer brand in the world. From the initial offering of 150 models in 1987, today the supply chain and manufacturing set-up has the capability to handle over 3000 watch variants, the fact that depicts the product mix complexity.

INTERNATIONAL BRANDSTommy Hilfiger Watches

Tommy Hilfiger, one of the best-known American fashion brands, has its roots in Elmore, New York. The brand is recognized world over for watches, jeans, fragrance. 

The Tommy Hilfiger watches are crafted with precision and care and finished with unique signature details for unmistakable style. The look these watches represent is cool and classic, spirited, fun and always fashionable.  The watches strike a cord with people who espouse the brand attitude of being optimistic, hip, real, natural, confident, relaxed and spontaneous. The designer styles with an unmistakable ‘Tommy twist’ are offered with collections to suit different tastes, moods and occasions of wear.

Titan Industries Limited has made Tommy Hilfiger Watches available in India at most ‘World of Titan’ stores, leading multi-brand watch outlets, and department stores like Shoppers Stop, Central and Lifestyle.

Hugo Boss Watches

Hugo Boss, one of the world’s most popular European brands, has its roots in Germany. Hugo Boss is known for shoes, accessories, and fragrances. Watches complement and complete the portfolio. Hugo Boss watches were launched globally early this year. The Hugo Boss watch designs connote European elegance and couture and are a symbol of power and sophistication.

Hugo Boss watches are now available in India, thanks to Titan Industries Limited.

French Connection Watches 

Founded in 1972 by Stephen Marks, French Connection set out to create well-designed fashionable clothing that appealed to a broad market. f c u k  is a short, sharp acronym for French Connection United Kingdom. It is now one of the strongest brands in Britain and operates in over 25 countries. Having established

a strong core clothing business, through unique design and a true sense of style the company has, over recent years expanded its portfolio into exciting new areas including men’s and women’s toiletries, shoes, jewellery, watches, and eyewear. 

f c u k has been launched in select Large Format Stores and Multi Brand Outlers across the country by Titan Industries Limited. 

 

 

TITAN INTERNATIONALTitan Industries entered the international watch market with their business endeavour in the Middle East in 1991. This launched the Titan brand of watches in the UAE, Oman, Qatar and Bahrain. Saudi Arabia and Kuwait were added in 1994.

Titan Industries has distributors in every country it operates in.  The distributors set up exclusive and multi – brand stores to sell Titan products. Apart from this arrangement, retail also takes place via high street retailers, power retailers and department stores.

To remain a successful global player, Titan has further reinforced its thrust in the international markets by evolving products to suit the tastes of the local consumer as well as being contemporary keeping the current international trends in mind.

Being the fifth largest integrated watch manufacturer in the world, Titan emphasizes world-class quality supported by excellent after-sales service policy that goes beyond the international norms. At the international level, Titan operates in the mid-premium price segment category. With innovative technology-driven products like Titan Edge - the slimmest watch in the world - Titan is presently the market leader in its category in Oman and Bahrain, and at No. 2 position in the Middle East.

Titan expanded to Asia Pacific in the late nineties, and has recently made a foray into South Africa; Singapore, Dubai, Malaysia, Oman, and Vietnam are some of the major countries where the brand is offered. The customers include non-residential Indians as well as Vietnamese, Thais, Arabs and Filipinos. Through a combination of contemporary style, excellent quality and affordable prices, Titan has put together an exceptionally appealing proposition for the people of these countries.

With over a hundred million satisfied consumers world over, Titan has successfully established its brand value internationally.

TITAN CUSTOMER SERVICESpread across India, with 786 service contact points across 343 towns, Titan Industries’ service centre network is committed to deliver a satisfying post-sales experience to all the customers.

The Watch Care Centres are attached to the World of Titan and  Authorised Service Centers are attached to the ‘Multi-brand outlets’, both offer quick and high-quality repairs for all types of watches currently sold by Titan with a six-month service guarantee.  At the Titan Watch Care Centres, all repair activities follow a strict and systematic process that is controlled and measured through an ISO audit system. To ensure good quality, faster turnaround time and customer satisfaction, Titan Industries has various schemes in place. A post service follow-up (for major repair activity) is mandatory to complete the cycle of customer satisfaction. Titan's loyalty Signet program - where customers can redeem their points – is part of Titan’s effort to retain and value its loyal customers.

Titan Customer Service also markets spares and accessories, such as batteries, leather and metal bracelets to all outlets that sell Titan, Sonata and Fastrack watches. Staff actively encourage customers to use only original spares in order to ensure quality and satisfaction.

Titan Customer Service, with the ISO 9001 & 14001 certification, focuses on the best post-sale experience and complete customer contentment.

SUBSIDIARIES

Titan Time Products Limited

Titan Time Products (a 100% subsidiary of Titan Industries) specialises in manufacture of electronic-board assemblies for industries such as automotive, industrial electronics, telecommunication, consumer goods, medical, and defense.

The state-of-art manufacturing facility, located at Verna, Goa, supports 150 people and boasts of a clean-room facility matching a class 10000.

Titan Time Products’ capabilities include Surface Mount Technology for fine-pitch assemblies, Ball Grid Array placements, Chip-on-board Assemblies/ Wire bonding, and Through-hole Assemblies. The testing facilities we offer include In-circuit testers, Automatic Online Inspection equipment (AOI), Solder-thickness measuring systems, and various other functional test set-ups.

Titan Time Products’ quality systems are accredited to ISO 9000 and TS 16949 standards and all processes are Restriction on Hazardous Substances compliant.

This centre is seamlessly aligned with our group facilities in Bangalore and Hosur, providing customers box-build capabilities with plastics and sheet-metal integration.

We enjoy an elaborate network of component suppliers and manufacturers in India and abroad, and have sourcing set-up in Hong Kong and the UK.

Titan Time Products’ value chain processes run on SAP, and the manufacturing systems are calibrated to process multiple products simultaneously, with batches varying from Proto lots to larger volumes.

The impressive array of awards bestowed on the company, such as the Award for Excellence in Total Productive Maintenance, the IMEA – Frost & Sullivan Award, the CII Excellence Award and the ELCINA – Dun & Bradstreet Award are confidently illustrative of Titan Time products’ strong and world-class manufacturing practices.

DISTRIBUTIONDistribution in India

A key business partner of Titan in the marketplace, is the redistribution stockist. The distribution channel handles well over 50% of the watch business of the company. The main focus of this channel is market penetration and coverage. Currently we have 65 distributors handling well over 6000 dealers across the country. Titan's growth rate in the marketplace requires us to appoint new distributors every year. The combined stockholding and credit to the market is controlled to stay within stipulated limits. The distributor channel operates independent of all other channels and reaches out to its own set of distinct dealers.

We distribute through an exclusive distributor in each country, who is responsible for indenting, distributing, servicing, assisting and providing marketing support for the brand.

Interested in becoming a Titan distributor?If you are interested in taking on the distribution of our watches in your region or your country, please contact us at distribution@titan.co.in

Or write to:

Mr. J MuraliGroup Manager - Supply Chain ManagementTitan Industries Limited Tower-A, Golden Enlclave Old Airport Road Bangalore - 560 017India  

COMPANY PROFILETitan Industries is the organization that brought about a paradigm shift in the Indian watch market when it introduced its futuristic quartz technology, complemented by international styling. With India's two most recognized and loved brands Titan and Tanishq to its credit, Titan Industries is the fifth largest integrated watch manufacturer in the world.

The success story began in 1984 with a joint venture between the Tata Group and the Tamil Nadu Industrial Development Corporation. Presenting Titan quartz watches that sported an international look, Titan Industries transformed the Indian watch market. After Sonata, a value brand of functionally styled watches at affordable prices, Titan Industries reached out to the youth segment with Fastrack, its third brand, trendy and chic. The company has sold 100 million watches world over and manufactures 12 million watches every year.

With a license for premium fashion watches of global brands, Titan Industries repeated its pioneering act and brought international brands into Indian market. Tommy Hilfiger and Hugo Boss, as well as the Swiss made watch – Xylys owe their presence in Indian market to Titan Industries.

Entering the largely fragmented Indian jewellery market with no known brands in 1995, Titan Industries launched Tanishq, India’s most trusted and fastest growing jewellery brand. Gold Plus, the later addition, focuses on the preferences of semi-urban and rural India. Completing the jewellery portfolio is Zoya, the latest retail chain in the luxury segment.

Titan Industries has also made its foray into eyewear, launching Fastrack eyewear and sunglasses, as well as prescription eyewear. The organization has leveraged its manufacturing competencies and branched into precision engineering products and machine building.

With over 560 retail stores across a carpet area of over 7,09,000 sq. ft. Titan Industries has India’s largest retail network. The company has over 300 exclusive ‘World of Titan' showrooms and over 740 after-sales-service centers. Titan Industries is also the largest jewellery retailer in India with over 113 Tanishq

boutiques and Zoya stores, over 28 Gold Plus stores and over 88 Titan Eye+ stores. The company has two exclusive design studios for watches and jewellery

Backed by 4,514 employees, two exclusive design studios for watches and jewellery, 11 manufacturing units, and innumerable admirers world over, Titan Industries continues to grow and sets new standards for innovation and quality. The organization is all geared to repeat the Titan and Tanishq

success story with each new offering. PRODUCTSTitan Industries, best known as India's pioneering manufacturer of quartz watches, has also etched a niche for itself in some of the most competitive spaces in the fashion industry such as jewellery and eyewear. Precision engineering is another area of specialization that Titan Industries is proud of.

Watches: Being the world's fifth largest integrated watch manufacturer, Titan Industries has created and sold more than a 110 million pieces the world over.

With a production rate of over 12 million watches per annum and a customer base of over 100 million, Titan Industries owns manufacturing and assembly operation centers in Hosur in Karnataka, Dehradun, Roorkee and Pant Nagar in Uttaranchal, Baddi in Himachal Pradesh, and an Electronic Circuit Boards (ECB) plant in Goa.

Capturing the important market segments and the changing fashion trends, Titan Industries has brought forth four core watch brands:

•  Titan is designed for the mid-premium segment•  Fastrack is crafted to fit the trendy fashion space with a focus on the youth •  Sonata is created for the mass market and has emerged as India’s largest selling watch brand •  Xylys is fashioned for the premium market, aiming at the high-end connoisseur and new-age achiever

The Titan brand architecture comprises several sub-brands, each of which is a market leader in own space. Notable among them are: Titan Edge, Titan Raga, Nebula, Heritage and several other collections like WWF, Zoop, Orion, Purple, Obaku and the Automatic series. The Titan portfolio owns over 60% of the domestic market share in the organized watch market.

Titan Industries’ pride possession, a world-class design studio for watches and accessories, is the place where some of the most coveted creations have been conceptualized.

Exclusive World of Titan and Fastrack showrooms and over 12,000 outlets in more than 2,554 cities in India make these much-sought-after watches available to the buyers. The watches are also offered internationally in 30 countries, with a

special focus on the Middle East and Asia Pacific regions. The after-sales service, a benchmarked operation with a large network of exclusive service centers spread across the country, is one of the operation units with the fastest turnaround time in the world.

Jewellery: Following the suit of time products, Titan Industries’ Tanishq has been India’s largest, fastest growing and most popular jewellery brand.

Tanishq offers a premium range of innovatively created gold jewellery with an aesthetic use of diamonds and precious, semi-precious stones in various hues. Arresting designs in 22kt pure gold as well as platinum are among the most admired products on the company’s list. GoldPlus the recent retail plain gold jewellery offering, is specifically created for semi urban and rural Indian market. The brand offers gold jewellery, as well as unique designs crafted with diamonds, American diamonds and other precious stones.

Titan Industries boasts of 115 Tanishq boutiques, 2 Zoya stores and 29 Gold Plus stores in India. The enchanting jewellery patterns that are part of these brands originate in the well-equipped exclusive jewellery design studio of Titan Industries.

Eye wear: Titan Eye+ of Titan Industries offers sunglasses under its Fastrack brand. Prescription eyewear such as lenses and contact lenses is also part of the range. Titan Eye+ offers frames, sunglasses, and accessories of Titan Industries’ in-house brands as well as other premium brands.Precision Engineering: The Precision Engineering division of Titan Industries supplies precision components to the aviation and the automotive industry. As an Original Equipment Manufacturer (OEM), the company makes dashboard clocks for car manufacturers in Europe and America.

Equipped with best certifications such as AS 9100B for the aerospace segment, TS 16949 for the automotive segment and the coveted Ford Q1 status - the highest supplier recognition from Ford – Titan Industries also offers fully integrated automation solutions.

AWARDS & ACCOLADESOver the years, Titan Industries has received several prestigious awards and distinctions. Some of the recent and most noteworthy recognitions are:

• Titan Industries received the Award for the Most Admired Timewear Brand of the Year in   2009 for the ninth successive year for Titan, and the Most Admired Jewellery Brand of the Year for the seventh consecutive year for Tanishq.

• Goldplus bags 2 dragons and 2 certificate of merits at the Promotion marketing awards of Asia 2009.

• Jewellery Division was declared the winner of the “GOLD AWARD" in FMCG sector in the GreenTech Environment Excellence Award 2009.

• Jewellery Division wins first prize in “Innovation in Supply Chain Management” organized by Indian Institute of Material Management for the second consecutive year and ranked amongst the top five amongst 50 global entries at Europen Business School, Weisbaden Germany .

• Titan brand won the “Most Valuable Brand in the State” award at the IIPM & The Sunday Times STATE EXCELLENCE AWARD.

• Both Titan and Sonata feature in the Top 100 Brands-2009 in the Annual Survey conducted by Economic Times. While Titan is ranked at Number 4, Sonata increase their rank to 86. Titan is ranked number 1 in the consumer durables category.

• Jewellery Division of Titan Industries Limited won the Eight Annual Madras Management Association award on Managerial Excellence for Manufacturing sector.

• Titan Industries bagged 19th position across all industry categories and 1st position in the Retail Industry category in the Economic Times – Great Place to Work Institute study. The survey results show that 92% employees across Titan Industries feel that Titan is a Great Place to work!

Titan Industries was one of the five organizations to be awarded the "Corporate Social Responsibilities" award - Best Commercial and Industrial Institute for 2009 - 10 by the Government of Tamil Nadu.

 

CELEBRATING TITANAfter two decades of building relationships with our customers, and learning from all the successes and failures that came our way, it is time to pause, reflect and celebrate.

It is time to honour the indispensable role of our people, our business associates and suppliers, who have enriched the fabric of Titan Industries, as we know it today. We are proud to have withstood the test of time and maintained our dedication to the values upon which Titan Industries was founded.

People are at the heart of our successOver the years, we have built our operations, nationwide and worldwide, leveraging the expertise of our most talented, dedicated and hardworking people with the vision, integrity, innovation and leadership qualities that our business demands.

Titan Industries have constantly invested in training, incentives and career progression across all our business units and have one of the highest employee retention records. We have instituted initiatives such as ‘Face of Titan’, ‘Tanishq Superstar’, ‘Look for Stars’ and ‘Titan Visionary’ to acclaim and commend deserving managers, store officers, cashiers and technicians.

For over two decades, our core values of commitment to safety, health and environment, high ethical standards and respect for people have been the cornerstone of our identity.

Innovation is a way of thinking at Titan IndustriesTitan Industries began its operations with an innovative offering - quartz watches - that changed the face of the Indian watch industry. Innovative ideas at Titan Industries have led to significant achievements such as Single Point Solutions to every Original Equipment Manufacturer customer. Titan Edge, world's slimmest watch, is probably the best example of the spirit of innovation in the organization – a feat achieved in less than five years of our existence.To facilitate innovation, we opt for external expertise from leading consultants like McKinsey, Quadra and Interbrand. We use cutting-edge business excellence tools such as Tata Business Excellence model based on the Malcolm Baldrige Criteria for Excellence, total quality management, 360-degree feedback process and benchmarking. Our contemporary store designs are a great example of innovation. They have redefined the retailing standards in India since the time when the concept of modern retailing had not evolved.Jewellery Division changed the dynamics of gold market by introducing the Karameter, an industry first in checking the purity of gold through a non-destructive test.

Relationships are a sacred bond of trust for usAt Titan Industries, we have built relationships and forged lasting bonds with our customers, employees, shareholders, network of business associates, and suppliers. With our futuristic designs, we created a desire in the minds of our customers and offered them accessories for every occasion. In a small way, we have been a part of all their celebrations. ‘Customer First’ - an initiative driven by the company is an embodiment of the customer-focused culture that we imbibed from the very beginning.

We continue to foster greater customer commitment by making our product lines more comprehensive.

Growth depicts many milestonesWe have been able to remain the undisputed leaders in the market. Taking the prognosis of brand fatigue seriously, we reinvented our selves with the impeccably styled Euro watches collection. Triumphs like this were interspersed with tribulations that spurred us to accept new challenges and overcome them with a resolve and commitment. With over 560 showrooms and 12,000 dealer-outlets, we are the largest retail network in India.

At Titan Industries, the celebration never ends.

HERITAGEFlashbackTurning back the hands of time pre-1980s, Tata Press conceived an idea to conquer the Watch Industry. Initial negated pioneering efforts aside, perseverance won the day. Titan Watches sprang into being with the signing of a joint venture of Tata Industries with the Tamil Nadu Industrial Development Corporation (TIDCO) in June of 1984. From that point on it has been full steam ahead.First Milestone Titan commenced production end 1986 and hit the market in March 1987 with its brand ‘Titan’. The analogue electronic Quartz range met instant acclaim, appeasing a hungry watch-starved consumer market. This spurred encouragement and manufacture extended to bracelets, cases, electronic circuitry and step motors.Along the waySpanning 25-years of growth, the Titan Watch Project became Titan Watch Division and ultimately Titan Industries.  Production kept an impressive pace, topping the 10 million plus mark per year.  Three years down the trail produced a dividend of 15% – today, 2009, sees a declaration of 100%!

Numerous technologies and sources came into play during this period. Progress was swift, steady and stamped with characteristic Titan aplomb. This led to innumerable achievements and accolades.Audaciously challenging the Swiss, Titan now is the world's largest integrated manufacturer of watches. A major brand player, Titan stakes claim to 60% of the organized watch market, with over 100 million pieces sold across 30 countries collectively.In successive events, the ‘World of Titan’ exclusive showrooms mushroomed nation-wide, currently totaling 280+.  The main manufacture facility is situated at Hosur in Tamilnadu with assembly units up north in Dehradun, Baddi, and Roorkee. Its Electronic Circuit Board plant is in Goa.Titan notably left its’ footprint in Europe in 1993; then came a major one in the Middle East and the Asia-Pacific regions. Titan now happily ticks its way across twenty-six countries around the globe. Internationally, Titan’s business amounts to over 675k watches annually.A brief joint venture with the Japanese Timex between 1992 and 1998, focusing on market mass, prospered. The brand Timex jumped to 2nd place next to Titan, in popularity. On dissolution of the partnership, Titan reclaimed market share by launching Sonata, an absolute winner, followed by an astute array of wrist wear - Titan, Fastrack, and Xylys brands, luxury watches and designer timescapes - a range of outdoor clocks - defining spectacular landmarks in several cities.Pacing on, the Swiss and Japanese watch fraternity was justifiably astounded, not only with the state-of-art Production facility established by Titan, but also with its highly trained, dedicated, youthful workforce. Endorsing the Tata spirit, Charles Correa, a world-renowned architect, was commissioned and fashioned a complete modern township at Mathigiri to accommodate over 2000 Titanians, complete with an excellent School that doubles as a learning facility for neighbouring district schools.Venturing on...Diversification accelerates progress. Titan’s expansion plans in 1993 turned to jewellery, with a brand launch ‘Tanishq’ in 1996. Then a spate of new ventures followed suit, Fastrack – the youth watch and accessories line in 2003; Precision Engineering in 2005, Goldplus the standardized mass marketing of jewellery in 2006 and the Titan Eyewear Division in 2007 - a project of prescription eyewear, complete with specialized outlets, catering to customers’ every need.Of these wholesome ventures, Tanishq and Goldplus proved Titan’s mettle indisputably.Catering primarily to a country which views gold as a prime investment, believes that it is auspicious, and finds it an irresistible adornment, Titan literally struck it rich by its entry into the world of traditional and designer jewellery.

The concept of entering the glitter field, in order to forge a way out of a foreign exchange crunch of the early 1990s, appealed to Titan Industries considerably.  And yet again, though early steps were far from expectancy, the innovative Titan spirit came to the fore, turning adversaries into achievement, and how!!Foreign Exchange being no consequence subsequently, caused Titan to focus exclusively on the home market. Today, Tanishq - the first branded jewellery player and Goldplus, are righteous equivalents of the Cartier, Tiffany, Esprit, and Ernest Jones of the West in credibility, standards and fame. Tanishq offers a stunning world of exquisite, precious designer ware through 117 stores in 75 townships across the nation. Goldplus has a proud market share of around 40% in the semi-urban and rural scenario, whilst still in its infancy. These two ventures are a pride to India and to Titan Industries, for they certainly keep value-conscious customers happy and contented.  

Titan's Collections 5Dash! 5Steel 6Edge 6Flip 6Sonata 7Fastrack - From Cool to Bold 8Raga 9Nebula 11Challenges 11Exhibits

Introduction:-

The big question- should a company stay focused on its core competencies and competitive advantages that made it great or should it diversify to keep up with, surpass its peers? Experts say it is one of the trickier questions to answer. But answer lies in the gains that a company reaps after diversification.

Corporate strategies expand the scope of operations through diversification into new businesses. Diversification into new business can reduce variations in corporate profits by expanding the corporation's lines of business. Diversification is a form of growth strategy. Growth strategies involve a significant increase in performance objectives (usually sales or market share) beyond past levels of performance. Many organizations pursue one or more types of growth strategies.

Diversification leads to improved financial performance. Large firms generate cash that can be invested in other ventures. That is, the core business sustains itself on its money making ventures, and uses this cash flow to create new ventures that generate additional profits. One of the primary reasons is the view held by many investors and executives that "bigger is better." Growth in sales is often used as a measure of performance. Even if profits remain stable or decline, an increase in sales satisfies many people. The assumption is often made that if sales increase, profits will eventually follow.

Titan industries, the watch and jewellery major is also changing its approach to its portfolio. Titan, Rs. 3,000 crore industry is moving towards a new segment what we call the life space. The strategy of Titanis discussed in the case study with an objective to find out and discuss its success in enhancing shareholders' value over the years.

Case Body

The foundation of the Tata Group was laid in 1868 by Jamsetji Nusserwanji Tata He learned the ropes of business while working in his father's banking firm and he established a trading company in Bombay.

Tata helped pave the path to industrialization in India by seeding pioneering businesses in sectors such as steel, energy, textiles and hospitality. The Tata Group expanded regularly into new spheres of business. The more prominent of these ventures were Tata Chemicals (1939), Tata Motors and Tata Industries (both 1945), Voltas (1954), Tata Tea (1962), Tata Consultancy Services (1968) and Titan Industries (1984).

Titan, a joint venture between Tamil Nadu Industrial Development Corporation (TIDCO) and the renowned Indian business group Tatas, entered the watch market in 1984. Titan changed the watch market in India completely by making quartz watch the centerpiece of its strategy. Titan Company is the unquestioned leader in Indian Watch Industry. Titan is one of the most powerful brands in the Indian market, scoring very high on brand awareness, brand image and brand preference.

The watch market in India recorded an approximate volume turnover of 23 million units (1998-99). It is growing at 9% per annum. The organized sector contributes to half the volume turnover of the industry and rest by the unorganized sector. Titan has 60% share in organized sector

Since its inception, Titan decided that it would be the shaper of the watch industry and not an adapter. The Tatas took two decisions that paid them well as well and changed the face of Indian watch market. They decided to manufacture only quartz (analog and digital) and not mechanicals and they projected as fashion accessory. Titan was first in India to introduce the style concept and was successful in projecting its watches as more than a time keeping machine.

Titan initially pioneered the concept of "Gifting watches". The ads captured the essence of gifting and along with the trendy music, easily caught the imagination of the market.

Customers who were fed up with ugly time machines welcomed the brand and Titan had a dream run for many years.

Titan entered the watch market as a premium watch. But the unorganized sector and low priced options from HMT gave Titan serious competition. With the import duty reduced to 25% (earlier 50%) and with the import license for watch movement being easy to obtain, many smalltime players cropped up. These small players offered competition to Titan on the price front.

Titan made a big mistake. It wanted to play the volume game. For that Titan launched another brand Sonata. Sonata was a huge success because it was a cheap product but at the cost of the mother brandTitan. Titan was perceived to be a premium brand but with Sonata (at that time "Sonata from Titan") endorsed by Titan took away the premium image from the mother brand. It was a big costly mistake.

Another problem with Titan has been that it mainly operates in the mid-priced segment and competitors accuse Titan of keeping the segment underdeveloped on account of its sheer dominance.

Titan realizing that the market wanted something to be excited about watches and carefully segmented the market and developed different sub brands for each segment. Sub brands like Edge, Steel, Dash, Nebula, Classique, Royale, Fast Track, Raga, and the recently launched Wall street . By having various products / models and sub brands, Titan was able to create freshness about the brand.

Titan launched Tanishq in 1995, India's largest, most desirable and fastest growing jewelry brand in India.Diligent care and quality processes ensure that the Tanishq finish is unmatched by any other jeweller in the country. 

Tanishq challenged the age-old jeweller's word with TATA's guaranteed purity. It exploded the market with facts about rampant impurity across India. It introduced technology-backed challenge in a category completely governed by individual trust. Tanishq introduced innovations like Karat meter, the only non destructive means to check the purity of gold.

Titan now is trying to be more contemporary and more relevant to the consumers by establishing more firmly in the minds of the consumers. "Be more" the new concept of Titan is attempts to build a larger life connect between the Titan brand and consumers.

Titan is changing its portfolio by shifting its focus from product attributes to the yearnings, emotions, experiences and aspirations. The Titan aviator is inspired by word war IInd fighter plane, Titan Octave by cockpit of formula one car, wwf collection by endangered species and Titan Raga Diva by beauty and sensuousness.

The picture that is emerging with this kind of collection is of the organization that is gearing up to leverage its strengths in manufacturing, design capability and retailing to grab a larger share in lifestyle market. With the success of Titan watches and jewellery segment and their recent entry in eyewear they are more comfortable with developing lifestyle brands. Under the brand Fastrack comprising watches and sunglassesTitan is now looking at the possibility of adding accessories like bags and belts and so on. To make this segment more attractive, Titan is planning to open exclusive Fastrack stores.

Eyewear is fast becoming a fashion statement and Titan is focusing on design and retail. Titan has also entered in prescribed eyewear segment and has opened 30 stores across 12 cities. Each of them is positioned as a complete optical store where under one roof customer can have a wide range of frames and lenses including some very famous global brands.

Tanshiq's makeover over the year as well is indicating the shift of Titan in life style segment. From being a fashion brand for young people with its light weight jewellery Tanishq added mainstream wedding jewellery to its portfolio. The association with Bollywood through movie like Amol Palekar's Paheli and more recent Jodha Akbar has also brought the brand close to the consumer.

The big factor that has been in Tanishq's favor is that it jewellery is now more of a lifestyle product for urban consumers. It is no longer bought for investment purpose. The key drivers in this sector are brand equity, design and retail experience. The Indian jewellery market is estimated to be around Rs. 70,000 crore to Rs.80, 000 crore and organized sector a small

local players account only for 4,000 crore. So opportunity for a player like Tanshiq with strong brand equity and first mover advantage is tremendous.

Tanshiq as a part of its expansion strategy has become global recently. It has opened a showroom in Chicago, USA targeting the average American. US is the largest jewellery market in the world and Tanishq has an opportunity to position itself between expensive brand Tiffiny and discounted brand Wal-Mart.

Titan is going strong on all fronts but is equally aware of changing market dynamics and its competitors.Titan is very closely watching its closest competitor Reliance. Reliance is the only corporate house afterTitan that has entered both in the jewellery and eyewear markets.

For the year 2007-2008 of Titan's turnover of Rs 3041 crore, the jewellery business accounted for Rs. 2027 crore while watches accounted for Rs. 918 crore. This is one of the main reasons Titan is leaning on its jewellery business.

Segment Sales (2008) Sales (2007)

Watches 918.69 783.77

Jewellery 2,028.00 1,291.96

Others 96.03 62.71

Total 3042.72 2138.44

Titan grew at 43% last year and crossed the sales of Rs. 3,000 crore. Net profit stood at Rs. 150 crore as compared to 94 crore last year. With these great figures, Titan is still going strong………..

Sr. no. Year Net profit Net Sales*

1 2004 10.27 804.53

2 2005 24.95 1136.60

3 2006 73.62 1483.15

4 2007 94.13 2138.44

5 2008 150.27 3042.72

Net sales include watches, jewellery and others segments.

Questions

1. Titan has been a dominant player in mid price segment with its brands Titan and Sonata. What were the reasons for the expansion strategy led by Titan to launch various brands in different segments?

2. Titan diversified into jewellery business in the year 1995 as a part of its growth strategy. Growth strategies involve a significant increase in performance objectives (usually sales or market share) beyond past levels of performance. Did Titan's diversification into jewellery business justify the above said statement?

3. How watches, jewellery and life space segment strategically fit in Titan's overall mission and vision accomplishment?

Teaching Notes

Overview

Titan, a joint venture between Tamil Nadu Industrial Development Corporation (TIDCO) and Tatas, entered the watch market in 1984. Titan changed the watch market completely by making quartz and projecting its watches as a fashion accessory. Titan Company is the unquestioned leader in Indian Watch Industry.Titan felt the need of expansion and diversification due to growing competition and launched various sub brands in watches and diversified in to jewellery segment with its branded jewellery Tanishq in 1994.

Diversification in the jewellery segment has been a fruitful investment which has been reflected in the turnover of the company over the years. This is one of the reasons Titan is leaning on its jewellery business. Recently Titan has shifted its focus from the core business to a new segment called life space. The company during the course of diversification and expansion managed reorganization of brands, products improvement, heightened competition, reallocation of resources according to the revised priorities of businesses.

Management issues covered:-

Strategic planning Managing risk across industries

Impact of diversification and expansion on financial performance

Brand reorganization to exploit financial resources and managerial capabilities.

Application

The study covers various management issues as discussed above. The case is well suited for management students who have some practical experience in handling some of the management aspects in large organization.

Objectives of the case:-

To develop strategic plan for the change and managing it to the desired conclusion. To make a student understand the issues related to diversification.

To understand and for see a need of change in the business strategy.

To study the impact of diversification on the financial performance of a company.

Teaching suggestions:

Not required

References:

"Reaching out for more" Business Today (November2, 2008)

Titan kicks of re-branding exercise: // www.dnaindia.com/

http://www.titanindustries.in/titan/default.aspx

http://www.titanindustries.in/News.aspx

http://www.titanworld.com/titan_stories

www.indiainfoline.com