French luxury goods group, Louis Vuitton Moet Hennessy Watch & Jewellery, is all set to rev up the competition on international watch brands such as Longines, Omega and Rado.
LVMH has finalised its Indian plans for the next three years. On top of their marketing strategy is simultaneous launch of all its latest products in India (as in the recent launch of Chris 47 steel watch) and comparable pricing with other markets.
It is also looking at professionalising the Indian luxury watch retail sector and reaching out to consumers in 18 cities by the end of the year.
According to retail sources the Indian luxury watch market is estimated at around Rs 220 crore (Rs 2.20 billion). The Indian premium and luxury watch market in totality sells about 40 million watches at the lower end of the price band.
Watches above the price range of Rs 10,000 has a market of only 1,20,000 units annually.
While, the overall watch market is understood to be growing at a compounded annual growth rate of 8-10 per cent, the Swiss watch market is growing at 20-25 per cent per annum.
LVMH entered India nine months ago with Tag Heuer, and then launched the Christian Dior watch brand.
Phillipe Pascal, chairman and CEO, LVMH Watches & Jewellery says: "Since we have been here, the response to our presence has been very encouraging. We are focusing only on these two brands for now. We do not want to saturate the market with all our brands but, instead grow the market professionally by building a more organised and professionalised retail set up."
LVMH Watch & Jewellery has four premium watch brands, the other two are Zenith and Ebel.
"The Indian market is very promising," said Ravi Thakran, managing director, Asia, LVMH Watch & Jewellery.
"With the Indians arriving young in life on the economic front, the market for luxury watches in India is buoyant. Watches are now being considered a fashion statement by Indians and they do not mind paying a premium for them," he adds.
Despite a steep 85 per cent duty imposed on the luxury watch sector in India, LVMH does not want price discrepancies between Indian and international markets.
"A Tag Heuer or a Christian Dior watch will be available at the same price as in Dubai," says Thakran.
Company officials say that this decision will no doubt lead to losses in the first few years. But, they say they have decided to take a plunge in order to ensure that none of their products come through other channels.
Apart from comparable pricing, Pascal says that the company is also committed to offering an international shopping ambience to Indian consumers, for which it is investing a substantial amount of money in training people at its various points of sale.
While he refused to divulge any figures on how much LVMH Watch & Jewellery is investing in India, it is understood that they are investing anywhere between Rs 8-10 crore on marketing alone in the first year of their operations in India.
The company is getting a trainer from abroad to train its staff to effectively handle customer requirements. The company's other plans in India also include an increase the number of cities they are present in.
"We are currently present in 12 cities with 27 points of sale. By the end of this year we want to be in 18 cities with 40 points of sale." Eventually, the label will spread to 70 Indian cities, Thakran adds.