PEST Analysis all firms (not only watches)

Political

Indian market is competitive because liberation enabled international companies to enter the market.

Many global brands set up subsidiaries in India because it adopted many foreign investors friendly
regulations such as allowing up to 51% of foreign direct investment in single brand retail operations.

EXIM policies set the standard for international import of products including watches in India.

Unorganized retail sector (low cost retails) controls the markets and impact pricing and offering strategy

Economic

Rising of Indian disposal income

2009 recession resulted in reducing global demand for many products and services.

Spending on personal products and service necessities, including watches, is expected to increase from
8% share-of-wallet (SOW) in 2005 to 11% in 2020.

Social

Exposure to western lifestyle

Need for the new generation to establish an identity for itself because consumers purchase brands that
reflect their personalities.

Technological

Products such as TV, iPods, portable music player, etc. have a major impact in shaping the markets,
influencing consumers perception of technology use and affecting psychological needs of consumers.

Technological products are diffusing into the market at a fast rate that they can influence product
offering, forcing manufacturers to stay innovative to keep with consumers demand of
SWOT

Strengths Internal

Titan owns the largest market share of the Indian watch market of 20.6% in 2009.

Titan is the only Indian brand that offers premium and luxury watch.

XYLYS carries Swiss-made tag that is associated with quality, precession and premium

XYLYS uses quartz analog technology to manufacture its watches, a technology that is associated with
elegance and style.

Threats External

Premium watches in India are associated with Swiss brands.

Market of luxury watches is controlled up to 65% by unorganized sector.

Stiff competition in the Indian watches market because it is open to foreign players. Many brands such
as Casio, Rolex, Citizen, Tissot, Omega, Rado and TAG Heuer compete with Titan on market share.

Watches compete with many other symbolic and lifestyle products such as TV, iPods, portable music
player, etc.

Watches are facing strong substitute threat as mobile phone, iPad, etc are becoming a more productive
substitute.

Opportunities External

Indian premium and luxury watch market is experiencing a growth in consumer demand of 20% annually
despite global decline in sales due to 2008/2009 recession.

Indian premium and luxury watch market consists of a small share (only 3%) of watch retail in India.

Luxury watch market is expected to grow 7.3% in volume and 13.7% in value for the period 2009-2014.

Market for sport watches remain untapped with a only 5% of watches retailed were sport.

XYLYS operates only on the premium field of luxury watches market. A large untapped market remains
in accessible luxury and even exclusive luxury for Titan to discover.

Special watches such watches with gold casings and watches that could be part of ritual gifting
ceremony offers a market opportunity for Titan to discover.

Weaknesses Internal

Titan manufactures watches with different price range. Lower end watches such as Fasttrack, Sonata
and Regaa were marketed using the same strategies as the luxury brand.
STP analysis

XYLYS was marketed XYLYS using a concentrated (niche) segmentation strategy by utilizing the following
three segmentation strategies:

1) Demographic: XYLYS targeted middle age (30-40 years old) male and female upper strata of
management with high income, including CEOs, entrepreneurs, and working professional
2) Psychographic: When it was launched in 2006, XYLYS was marketed to convey style, attitude
and power. XYLYS targeted contemporary, dynamic, successful people who had confidence
and wanted to show their success their success to the world. In 2010, XYLYS launched a new
advertisement campaign, positioning how the brand takes control of a person and focusing
on the irrational desirability to own the brand.
3) Behavioral: XYLYS targeted consumers who sought benefits such as status, prestige, and the
enhancement of self-image and sense of belonging. Those consumers value aesthetic
appeal, durability and longevity of the brand but not precision and price.

XYLYS was positioned by focusing on the following areas:

1) Value: XYLYS was positioned as a premium watch with assured longevity, excellent
workmanship and good styling
2) Attribute: XYLYS was positioned as quartz analog watch, a technology that is usually
associated with elegance and style
3) Benefit: XYLYS was positioned as functional focusing on enhancing personal status,
prestige, self image and sense of belonging. XYLYS was positioned recently in 2010 as an
experiential brand, conveying the message that the brand could emotionally influence
consumer preferences and to actively shape their perceptions of the brand.
Marketing Mix Comparison of XYLYS and its major competitors (Tissot and Seiko)

XYLYS Tissot Seiko

Manufacturer Titan Swatch Seiko
Country of origin India Switzerland Japan
Country of Switzerland Switzerland Japan
manufacturing
Strategy in promotion Launched in 2006 Respecting Respecting brand
with a focus on traditions and heritage of
brand image in authenticity, technology and
conveying style , underlining core innovation,
attitude and power value of Underlining core
In 2010, the band performance & value of being
changed its precision (quality) technology
promoting strategy setting new advanced brand
to cater attitude, standards by
lifestyle and appealing to
personality of new integrating luxury,
generation. The sophisticated and
new brand focuses approachable
on irrational lifestyle
desirability of focusing on style
consumer to obtain and design
the brand
Product Different collections- Different collections
Contemporary, Classical including Touch, Trend,
and Sport with over 60 Classic, Gold, Pocket
models and Heritage
Price Lower spectrum of Wide range spectrum Lower price range than
luxury watch segment covering both XYLYS and TISSOT
affordable luxury and
premium luxury
Promotion Advertisement: Advertisement:
Movie stars (Rauhl Bose Movie star (Deepiaka
and Saria Mohan) and Padukone )
tennis star (Carlos
Moya) Partnership with many
sport association such
as International
Basketball Federation,
the Australian Football,
League, the Chinese
Basketball Association,
the MotoGP, and the
World Championships
of cycling, fencing and
ice hockey
Place Sold at World of Titan Sold over 150 countries Sold at SEIKO flagship
showrooms, key multi- stores and at several
brand outlets, and at higher-end multi-brand
exclusive flagship outlets
boutiques in select
cities
The problem

XYLYS is currently facing various issues:

Demand in market is volume driven be low end watches and value driven by luxury brands.
Significant increase in competition in Indian market due to presence of many local and global
players.
Emergence of new generation consumer segment distinguished by its lifestyle and its awareness
of global brands.

Solution

Create a Product Development Growth Strategy

XYLYS will create a custom made watch simulator that allows customer to custom made their watches.
This simulator will allow customer to choose the shape and personalize it. The body of the watch for
instance could be customized by colour and material of construction for case, bezel and strap. Hand,
indices, date wheel and number, and marker could also be custom made with different colour. The
watches could also be embellished with platinum, gold or sliver.

Pros
Allow XYLYS to leverage its existing strength and
pursue new product development as a growth
strategy
Allow XYLYS to tap into luxury and even exclusive
luxury market with platinum and gold watches
that will be priced above the current premium
segment of XYLYS
Allow consumers to use these watches for gift
because gold item are highly valued in India
Allow consumers to gain the status and prestige
they are seeking with these special custom made
watches
Cons
The price range of these custom made will be
higher than the premium brand currently offered
by XYLYS. Demand for such watches could
therefore be low
The customization process might not appeal to all
consumers specially those who are not technology
savvy.
Customization might require different elements
and parts that XYLYS has to carry at all time. This
might increase inventory level.
Analysis of consumer self concept

http://www.labbrand.com/brand-source/experiential-branding-using-5-senses-build-brand-equity

Based on VALS categories, the brand targeted Achievers who are motivated by achievement look for
brands to show their success to the world.
Based on VALS categories, the brand targeted Experiences who are impulsive consumers want to look
good and have cool stuff.