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To support new launches and to connect more with its target audience, the company is looking for a 360-degree mass market and integrated marketing promotion across many media vehicles (with a huge focus on radio broadcast). But there are challenges too. Today, the brand is facing an issue regarding distribution channels. For instance, in case of watches, except for Titan exclusive showrooms, neither are the other retailers stocking the full range of Fastrack watches, nor are they offering many of the new products launched by Fastrack.
However, to counter such bottlenecks, the company is planning to establish its own Exclusive Buying Outlets (EBOs) on a pan-India basis. To quote a number, it plans to open 50 such EBOs across tier II cities, as well as in metros by 2010. But at the same time, the surging real estate costs may pose a huge challenge to opening up new outlets. So is investing such amounts worth the risk? A confident Bhasin defensively argues, “Till now we have eight stores and most of them have reached break-even within just a year. We also know that even our most recent investments would generate good returns soon.” Not a hollow boast as its store in Pune can get loud about 50-70 footfalls per day. With the sales conversion rate falling in the range of 50-55%, reaching break even within 11 months of its opening appears real. The reason for reaching break even so early can also be attributed to the geographical positioning of these stores, as most of them are located in the youth catchment areas, such as near colleges, et al (to cite an example, the store in Bangalore is located in Bel Road, next to Ramaya college).
Today, 25% of Titan’s revenues come from sales of Fastrack watches. And what’s better, to further fuel and support the growth of these stores, the company has plans to roll out more merchandise categories and is planning to promote such products online. However, for now, the company has no plans of manufacturing the products in-house, and therefore plans to outsource all its requirements.
Talati may have been worried when Timex broke its ties with Titan, but for sure, Fastrack has burnt past tracks in time for Titan to be rest assured that they have another winner of a brand in their pockets. While on one hand competition is pouring over all kinds of blueprints to slice through Fastrack’s growing charisma; Talati and his youthful team on the other hand are optimistic that core attributes like ‘fashionable’ and ‘affordable pricing’ will attract more young consumers toward Fastrack; after all, that alone has helped its metamorphosis into a complete accessory brand that it is today.
For more articles, Click on IIPM Article.
Source : IIPM Editorial, 2010.
An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).
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