Timex Group, India’s second largest watchmaker after Titan, is set to report a 35% annual sales growth, its highest in a decade. V D Wadhwa, managing director, attri-butes the phenomenal growth to international brands in Timex’s portfolio and revitalised distribution. From the popular wristwatch costing less than Rs5,000, the 19-year-old company has graduated to selling as many as eight premium brands (ranging from Rs8,000to Rs5 lakh) in the last two years, thanks to global tie-ups with Marc Ecko, Salvatore Ferragamo, Versace, Versus, Guess and Nautica. Wadhwa tells Shailaja Sharma what it means to be the second in the priority list of parent Timex Group USA.
What investments are lined up, considering India is now a priority market for the group?
We are the second largest market in the world outside the US now. In terms of investments also, we are a priority market for Timex. In recent times, we have invested $1 million in retail expansion and we have increased our advertising budget by $2 million this year. We are likely to close the 2011 calendar year with 35% growth, which is the highest growth in a decade. This is a combination of several things - we opened a lot of new stores, new point of sales and added several brands. Until two years ago, Timex struggled in the market alone. Now, besides Timex, we have other brands. Within this 35%, Timex has grown 21%; the 14% growth has come in from new brands that were not there last year.
Do you see the need or scope to bring in more brands to India?
No. There is neither scope nor the intent to bring in more brands. In less than two years, we have brought eight brands to India. Doing justice to each of the brands, setting up their distribution, growing each brand that is targeted at a different segment… it’s a hell lot of work. So we are not intending to bring in any new brands at least for the next two years. Our maximum growth last year has happened in the Rs3,000-5,000 segment.
Earlier, the acceptability was in the below Rs3, 000 segment, now the segment above that value has grown by 120% last year. The focus will be to consolidate and strengthen our women’s category, and to grow awareness about our health and wellness category.
How huge do you see the health watch category becoming?
Globally, the category is some five or six years old. In India, we didn’t try them earlier. We tried digital watches ten years ago. They, however, didn’t do well. Consumers perceived them as cheap and undesirable. So the health watch category is a new one in India. Almost 99.9% of the watches sold in the country are analog while the new launches like Heart Rate Monitor will try to popularise digital watches. Consumers are now understanding and accepting digital watches. Eventually, this will become bigger, because in the US, around 30% of our sales come from the health and wellness category. The Heart Rate Monitor watches tell the wearer his heart rate, calories burnt, how much calories were consumed. If you are a runner or working out in the gym, it gives you specific updates. These products are very popular in developed markets. We are trying to create the image for the brand right now and not looking at huge volumes from this segment initially.
Consumers seem to be shying away from discretionary spends. Is there an impact on the watch industry too?
So far, we haven’t felt any impact in the watch industry. My own sense is, wherever the consumer has to take a loan for buying a house, white goods, a car, those are the purchases which are slowing down. Nobody buys a Rs2,000 watch on installment. We are in a segment which is largely below Rs5,000 and I don’t think that is discretionary. Look at the way consumers are changing their mobile phones every year. Consumers just keep acquiring new watches while they continue to collect the old ones. November was the only month post-Diwali where we had seen a slump in sales. But even in our high-end brands like Versace and Salvatore Ferragamo, we have not seen any slowdown.
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