The overall Indian watch market amounts to more or less 48 million wristwatches per year, with a growth rate between 8% to 10%. The organized sector represents only 30% of this amount. Nearly 34 million watches are sold through grey market channels, accounting for around 114 million Euros sales, including import of cheap parts which can be easily assembled in India.
The major contributing sector in volume is the under 20 Euros watches segment, but with the opening up of the Indian market, foreign brands are now flooding in, rapidly gaining new shares. Among them, luxury brands (over 2000 Euros watches) can be afforded by more or less than 7 millions people (0,5% of the population). Gold plated watches account for 70% of the market.

Major players
1. The Swiss have four-pronged stategies: to remove myths from the Indian mind that Swiss watches are only for the “super rich”; to introduce faces Indian can relate to; to market their products in the same category as jewellery; not to touch on anything that decreases the “snob” value.
2. The Japanese are feeling the Swiss pressure intending to market watches as “objets d'art” rather than as mere gizmos. The Japanese are ready to counter this strategy with digital innovations. They plan to flood the Indian market with user-friendly timepieces, maintaining cost advantages.
3. Amongst the Indian players, Titan is the undisputed leader. But to keep the same share of the medium market (50%) means constant upgrading and innovation. Titan is now flooding the market with international style and features watches at highly competitive prices.
4. Taiwanese and Hong Kong/China products are available in the grey market. They are pushing in sleek, sporty, electronic gizmos with a very strong cost advantage. The major revenue sources are organized Indian players for whom they act as OEM suppliers.

The Indian Consumer
Based on a research conducted amongst a representative panel of retailers both in Delhi and in Mumbai, Indian consumers can be divided into different categories.

Men
1. Elite / Professional class. Prefer to wear branded watches with variety of styles. This category generally prefers to have a small collection of watches suited to various occasions.
2. Traditionnal Businessmen / “Nouveaux riches”. Not much concerned by the utility of the watch, this category bears timepieces as status-symbols to communicate their “wealth” achievement. They ideally prefer watches with high jewellery value, gold, diamonds, etc…Preferred brands: Omega, Rolex, Rado.
3. Market savvy, high profile executive. This category prefers branded and designer watches. Cost doesn't matter much to them. They are fashion conscious and update their choices as per the trend. Usually foreign brands with a classic look is preferred.
4. Middle income group (Men). This category generally prefers to buy an all-occasion watch, preferring branded/economical products with a “decent” style. Most preferred watch styles are Day/Date, scratchprooof watches, waterproof watches. This category possesses knowledge about the variety of brands available but is price sensitive.
5. Young men. New generation is highly trends conscious and prefers functionnalities (whether useful or not) with hot looks. The categories most sought after are chronographs, scubas, digital, sports watches. Nike, Swatch, Esprit are at the top list of the most popular brands in this category.
6. Young men from higher middle families. They prefer branded watches. One young man contacted in the field survey commented: “I get respect in my friend's circle because of the uniqueness and the value that my watch carries.”
7. Young men from middle class families. They change watches frequently, but solely rely on the grey market, where they can get cheap imitations of high value brands. The are equally trend conscious but highly price sensitive.

Women
1. Jewellery is supposedly Indian women’s prime “weakness”. Some of the Indian watch manufacturers, like Titan, have launched solid gold collections. This range has been immensely appreciated by women having good disposable incomes and has also established itself as a regular marriage gift item.
2. Indian women want accessories to match their different dress codes and colours. This particular fact has been noticed by all the major watch manufacturers who are flooding the Indian market with “vibrant” colours and rich designs.
3. The popular “James Bond” Omega watch is very much in demand among the men (in 2000 Omega sold 12'000 pieces). However this trend is also shifting towards the women wanting to project a “confident, bold” image.
4. Sports watches and digital watches with futuristic designs are fast becoming very popular amongst college girls.
5. The upper income group and upper middle class women are very conscious about their respective choices in terms of apparels and accessories. Watches are in no way different and designers watches are logically taking the lead in this snob value society.
6. Middle class women prefer to buy an all occasion watch. They are price conscious and prefer to buy not very expensive branded watches.
7. The new young women generation is hyper-conscious about their preferences and choices, if compared to the previous generation. Widely exposed to international brand names but highly price sensitive, they search to buy different watches according to various occasions and dress combinations.

Unavailable models
Most of the retailers and consumers interviewed in this research commented that it is generally difficult to get the last international range in the showrooms of India.
As a leading watch retailer in Delhi declared: “The product comes in our showroom after much waiting. When it is here, it is no longer the latest release.”
According to another costumer: “Indian retaliers show you all the best watch catalogues, but when it comes to supplying, these models are not available.”
Rich people often prefer to get their watches abroad, as stated by such a consumer: “We generally prefer to but the premium range on overseas trips. We have a broader choice, get variety and there is only a slight chance of the product being counterfeit.”

In the near future…

 Now that the Indian market is widely open to importations, it will be extremely difficult for the Indian players to maintain a sustainable growth. Only price, degree of innovation and continuous brand personality enhancement can protect them from foreign invasion. Internationally branded innovative watches are flooding in. The counter strategies of the top Indian watch companies will be an interesting thing to observe.


 Vibrant colours and futuristic designs will be a major trend.

 The majority of the market share will be taken away by renowned global brands which are pushing brand name, style, design and price in a highly price sensitive environment.

 The main brand war will be fought in the sub 1000 Indian Rs
(1 US$ and 1 Euro = approximatively 50 Indian rupees) .

 The top premium brands will see a rise but there is a question mark: people spending that much of money are frequent overseas travellers and prefer to buy watches from foreign outlets rather than Indian.

 The unorganized sector will grow further. Chinese watches will flood the market to the advantage of the unorganized players and smugglers.


A 7% growth in 2003
After growing just 4.3 per cent last year, India's economy, the second fastest growing in the world after China, is widely expected to grow close to 7 per cent this year.
The growth of the past decade has put more money in the pockets of an expanding middle class, 250 to 300 million strong, and more choices in front of them. Their appetites are helping to fuel a demand-led growth for the first time in decades (people under the age of 25 now make up half the country's population).
India is now the world's fastest growing telecommunications market, with more than one million new mobile phone subscriptions sold each month. Indians are buying about 10,000 motorcycles a day, banks are now making $15 billion a year in home loans, with the lowest interest rates in decades helping to spur the spending, building and borrowing. Credit cards are slowly gaining in popularity.
The potential for even more market growth is enormous, a fact recognized by multinationals and Indian companies alike. In 2001, according to census figures, only 31.6 percent of India's 192 million households had a television, and only 2.5 per cent a car, jeep or van.
Foreign institutional investors have poured nearly $5 billion into the Indian market this year, already more than six times last year's total. The Bombay Stock Exchange's benchmark Sensitive Index has risen by more than 50 per cent since April, hitting a three-year high. Foreign exchange reserves are at a record $90 billion.

The infrastructures challenge
Until recently, India has neglected to develop its infrastructure, keeping its economic growth as well as living standards well below potential.
India's growth could have been faster were it not for the poor quality of the country's infrastructure - namely, its roads, ports, airports, and power (telecommunications is an exception).
But it is now changing.
The National Highway Authority of India (NHAI) has been given the mandate to bring India's road network up to world standard. The lack of good roads has shaved off at least a few percentage points every year from India's GDP growth.
The existing road network covers around 3.3 million kilometres and is among the largest in the world. However, just 2 per cent, or 58,000 kilometres are national highways, fit for speedy transportation, but they are overburdened, carrying more than 40 per cent of the total goods sent by road.
The NHAI has taken up two ambitious projects, explains Business Times Asia: “The first, the 'Golden Quadrilateral' project, expected to be completed by the end of the year, is to connect the four major cities of India - New Delhi, Calcutta, Mumbai and Chennai - with 5,846 kilometres of four-lane world-class highways.
”Simultaneously, a more ambitious 7,300 kilometres North-South and East-West Corridor project is being implemented, and is scheduled to be completed by 2007. In the north-south part, it will link Srinagar in Kashmir to Kanyakumari, the southernmost tip of India, a distance of 4,000 kilometres. In the east-west section, Silchar in the extreme east of India will be linked with Porbander in the west, a distance of 3,700 kilometres.
“Once completed, the economic benefits of this road network is expected to be as dramatic as the impact of the interstate highway system in the United States, which was built in the 1950s. What is more, as it becomes safer and cheaper to travel and transport goods by road, competitive pressure will build on Indian Railways.”
In a monopoly position, Indian Railways, the third largest rail network in the world, has been the main mode of transport of both goods and people in India, charging passengers low fares but high rates for freight. With increased competition from road transport, Indian Railways will be forced to modernize and restructure, offering more competitive pricing.
In the telecommunications sector, mobile telephone services - which are privatised - are growing even faster than in China. The subscriber base for cellular services has increased by nearly 10 times to more than 11 million users in three years and tariff rates have gone down by more than 90 per cent and are among the cheapest in the world. Similarly, tariffs have come down for long-distance international and national telephony by about 40-60 per cent. Internet telephony, which has become another growth area, is offered at even cheaper rates.
Changing the face of India's infrastructure will require about US$ 400 billion in funding over the next decade.
“If India can muster the political will to press on with the changes - and the signs are, thus far, good - it could produce a story of economic growth and transformation which matches that of China,” adds the Business Times Asia.



TO BE CONTINUED...
In the forthcoming days, the rest of this lenghty survey will be added to our europastar website.

India, From a watch market to a brand market

 Indian conception of time

India, Analysis: Overall Indian Watch Market

 A 7% growth in 2003

 The Infrastructure challenge

India, Profile: Titan, the inevitable giant

 Interview: Bhaskar Bhat, Titan's CEO

India, Distribution: India's evolving work of distribution

India, Distribution:

 TAG Heuer offers luxury watches in India at 0% financing

 LVMH is in India to stay

 Omega: to stay number one

 Piaget: 13 points of sales

 Edox to follow Swatch by skin

 Girard-Perregaux & JeanRichard unveils first exclusive boutique -Raymond Weil

 Chopard: taxes should be lowered -Harry Winston: India enters a new time zone