Titan hopes smartwatches to boost watch business

 

Titan Company is pinning hopes on the smartwatches to boost its watch business, one of its oldest divisions which showed some softness in the past quarter.

In the last quarter, the overall revenue from the watch business for Titan grew by 14%, though the profits (before interests and tax) grew only by 4%. Operating margin of the business declined by 14%.

Titan which is the country's leading watchmaker and the fifth in the world, launched the first smartwatch JUXT in January this year and has already sold 10,000 pieces. The company has now launched JUXTPro, the next variant with more features at a cost of Rs 22,995, targeting youth and technology freaks.

While the contribution of the smartwatches to its overall revenue is very low, the company hopes the launch will attract more excitement to the brand and the results will be shown in the next quarter.

"The whole watch segment has been losing excitement, so we hope that comes back. The margins in the smartwatch are very low, so also the revenue contribution. However, we hope to see a positive impact of the excitement," said S Ravi Kant, chief executive, Titan Watches & Accessories. This, along with the fact that festive season is coming up, would be very important for the company. "We usually see our sales picking up during the festive season and wedding season. So the numbers will go up," added Kant.

The company is positive about the smartwatch segment even though analyst firm IDC reported a 32% decline in sales of smartwatches globally in the June quarter of 2016. In the second quarter, 3.5 million units of smart watches were sold globally. Market leader Apple sold 1.6 million units less number of smartwatches as compared with the previous quarter.

"While sales of Apple dropped, the sales of other small players increased. The decline was reported as market leader witnesses dropped in sales. But smartwatches are here to stay. We are different from the rest as we are not a phone or a technology company, but we are watch-making company which is coming up with smartwatches," said Kant.

Globally, Apple leads in the smartwatch segment with a share of 47% followed by Samsung (16%) and Lenovo (9%). Smartwatches account for less than 5% of the overall watch industry globally.

The JUXPro smartwatch is currently available in 100 stores of Titan and they plan to extend it to more than 300 stores. The company also has an exclusive tie up with e-commerce giant Flipkart while its smartwatches are also available on its own portal.

The new smartwatch is touch-screen based with functions such as camera control, fitness and safety control as well notification alerts. The company says it is targeting the age group of 25 to 35 years.

Kant said that at Titan work is going on female-centric smartwatches and affordable smartwatches as well. "We are the market leader in India for watches and it is our responsibility to come up with an affordable smartwatch and we will do it," Kant added.