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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.”
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.
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.
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.
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.
Sports watches and digital watches with futuristic designs are fast becoming very popular amongst college girls.
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.
Middle class women prefer to buy an all occasion watch. They are price conscious and prefer to buy not very expensive branded watches.
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.
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.