 "Gunjan Shah CEO, Bata India")
Bata India is set to elevate its style quotient by positioning itself not only as a brand that’s value for money, which is already its trademark, but one that also symbolises style and fashion. At the heart of its new strategy is its recent licence agreement with global premium footwear brand Nine West under which Bata will manufacture in India and sell its footwear and accessories (handbags) through Bata stores, online platforms and standalone stores in India.
Bata is also pushing its Floatz product line to grab a share of the moulded footwear market but at a lower price than Crocs and Birkenstock who have disrupted the global market with their ethylene-vinyl acetate (EVA)-based footwear.
It also plans to challenge brands such as Adidas, Nike, and Skechers in the sneakers market by strengthening its portfolio in the performance segment through its Power brand from next year.
“Our new strategy is to bring in style and fashion products and help consumers upgrade even while we continue to maintain the value proposition of comfort and reliability which are key elements of what consumers look to us for,” said Bata India CEO Gunjan Shah.
The company has also been refurbishing many of its 1800 stores, including the 500 franchised ones that are mostly in Tier II and III cities.
The plan is to roll out the Nine West footwear (initially for women) very soon in Bata stores in the metros at a price tag starting from Rs 6,000.
“There is competition in every segment. But the premium global brands are mostly imported in India so they are at least 1.5 times more expensive than what we will offer. Our advantage is we will also be manufacturing them in India and might export too,” said Shah.
He says the moulded footwear market is already growing fast with revenues of Rs 5,000 crore plus per annum, accounting for 8 per cent of the total footwear market. But 80 per cent of it is in the Rs 700-800 and below range.
Brands such as Crocs and Birkenstock sit at the top of the pyramid. “We are positioning ourselves at a sweet spot between the two at around Rs 1,200-1,800 for customers who are looking for a product with good design and backed by technology but who cannot afford a price point multiple times higher,” said Shah.
He estimates it will take 12-18 months from the design stage to the launch because of the time taken to make moulds. It means that design copy cats who sell cheaper cannot make a dent in its market.
The sneaker market is even more crowded with the well known brands. Shah says it is divided into two segments: the casual lifestyle sneaker which is addressed by its North Star range and the performance segment.
From next year, Bata will aggressively roll out products in the performance segment with its Power sneaker.
“Here again, we have found a sweet spot. The MNC brands operate at a price point of over Rs 5,000. The homegrown brands operate at a price point of Rs 2,000 and below. We will position ourselves in the middle offering better technology and products,” said Shah.
BATA’S NEW PREMIUMISATION STRATEGY
· Tied up with Nine West to launch women’s footwear at Rs 5000 plus, cheaper than global competitors. Will manufacture in India.
· Not going to take on Crocs and Birkenstock in moulded footwear on price but will play in the larger mid-segment.
· Will make aggressive moves in the performance segment for sneakers with its Power brand but it will be cheaper than Nike, Adidas, Puma etc.
· Aims to hit 20 per cent sales from online in a few years including its own web store.
· India is already the biggest market for Hush Puppies outside of the US.
