'Seiko Top Three Luxury Watch Brands In India'
BW Businessworld’s Manish Kumar Jha talks to Susumu Kawanishi, Sr. Vice President and Niladri Mazumder, President, Seiko Watch Corporation about the brand, and the luxury watch market in India and abroad, among other things
Since formally entering India in 2007, Japanese watch manufacturer Seiko has become one of the top three premium watch brands in the country. BW Businessworld’s Manish Kumar Jha talks to Susumu Kawanishi, Sr. Vice President and Niladri Mazumder, President, Seiko Watch Corporation about the brand, and the luxury watch market in India and abroad, among other things.
Your journey in India started around 1958. How has the journey been so far?
Mazumder: We didn’t start in 1958, we had a lot of collaborations going on. Officially, we started retailing in India in 2007 with a 100 per cent subsidiary. Of course, we have seen Seiko with our grandfathers and fathers, uncles and it has been passed on from one generation to another. So it’s been a pretty decent journey for us.
A Seiko product typically stands for substance. If we are charging a price for that, we assure that there is quality in that product and it’s not just marketing.
Our journey in India started with us being perhaps perceived as a brand which sells just above Titan. Today, we are selling our watches in the price range of Rs 30K. The Indian consumer has now understood that there is value in this product and it’s in tune with the rest of the world.
The first 11 years have been good. Our CAGR in the last five years has been around 15-20 per cent, which is not a bad growth rate, even in a growing economy like India.
We have only 13 national offices worldwide and India is one of them, although we sell in 180 countries. That shows how important India is to us not just now but from the future perspective also.
Please tell us how many watches you sell in India? Can you also tell us who your competitors are?
Mazumder: We have been one of the last watch brands to enter India officially. All the Swiss brands came a decade before us. They have had 10 years more than to us to build their brand in the country. The positive for us is that we have seen their mistakes and try not to make them. Our turnover is double compared to some of the Swiss brands that have been in the country for more than 20 years.
We have become one of the top three affordable luxury watch brands in the country with our prices ranging from Rs 25,000 to Rs 1 lakh and above. Among brands like Rado and Tissot, we are among the top three. We expect to grow at a CAGR of 15 per cent, that’s our goal.
We have seven exclusive Seiko boutiques. We don’t want to open too many outlets unless Ethos and Helios increase their number of stores. We are moving from being premium brand to a luxury brand gradually. Now we are in our second phase.
Globally, we have created five separate brands within Seiko. So you have Grand Seiko at the top with prices ranging from Rs 3.80 lakh to Rs 52 lakh. It’s absolute luxury and we have launched it in India recently. Our Astron is the world’s first GPS solar watch which is priced Rs 1 lakh and goes up to Rs 3.5 lakh.
We launched Grand Seiko in Japan in 1960, and it’s just been a decade since it was launched worldwide as it was a huge success in Japan. And I can says we are the fastest growing luxury brand in the world during the past decade. Of course, our base is small and we are still a child in that segment as compared to others but we are growing the fastest.
So who all will be your competition in that segment?
Kawanishi: Our competitors are big players such as Rolex, Omega, Rado, Longines, and others. In Japan, Grand Seiko is in the top five. Unlike in Japan, we are new in the international market, so our target is to be in the top bracket.
How easy is it to open outlets in India compared to a market like, say, China?
Both have large populations but different demographics.
Kawanishi: In China, they have their own style and tend to follow the same thing. So now in China everybody is buying smartphones; even in the watch industry a big percentage is going one way. But in India there is a lot diversification, people are free, have democracy, so many opinions and variations exist. Here, we are setting up outlets one at a time. We are happy to grow at 15 per cent every year. We are looking to create a strong base in the Indian market.
China is shifting to e-commerce, so everybody is going online, so that is very different.
What does a new customer to a Seiko showroom come looking for? What do women ask for?
Here in India.
Kawanishi: Globally, we have a Seiko standard in terms of products, service, knowledge, etc.
Mazumder: The first thing that we try to do in India is try not to create an island exclusive to others. Anyone wanting to buy a Seiko product will get the same product in India as they will in Singapore, Japan or elsewhere. Visual merchandising, the training will be same as elsewhere. I think the customer comes looking for the aesthetic value and what the product delivers.
Men are more influenced by marketing stories whereas women are more logical, realistic and they are concerned about the substance in the product rather than hype. Women are tougher to convince.
Where do you see yourself in India five years from now?
Mazumder: We also sell clocks in India and 20 per cent of the revenue comes from clocks. Their prices start from Rs 5,000 and go as high as Rs 55,000. There is a huge market for clocks in India. We are doing very well and are leaders in that
We have 450 outlets, and we will grow in tune with market growth. We have covered most tier-2 and tier-3 towns, and if more such towns come up we will go there. But more than multi brand retail, we are interested in having more boutiques. We have seven in India so far. We want 10 per cent of the total Seiko boutiques in the world to be in India. And we hope to grow by 10-15 per cent over the next three years.
Did demonetisation have an impact on your businesses?
Mazumder: Yes and no. Our watches are mostly bought in cash. The luxury sector was impacted in a major way, not so much the affordable luxury segment. But import duties have impacted us.
One of the few steps taken by this government that I really welcome is the GST (Goods and Services Tax). I think it used to be a terrible thing for companies that sell from one place; it was like I was handling 25 countries, and it was such a pain. Your material kept getting stuck. All of that hassle is gone after the introduction of GST, It is very important for this country and has a long-term positive impact and I will applaud this step.
Politically too, Japan and India are coming closer, with both sides appreciating each other. And it bodes well for companies like ours.