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Zippo To Set up First-Ever Exclusive Store In India

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Ever since the Indian government banned smoking in public places in 2008 in a bid to curb tobacco consumption and also put a ban on direct and indirect advertising of tobacco products and sale of cigarettes, tobacco firms and cigarette lighter manufacturers have been finding it difficult to promote products directly related to smoking and hence are looking at brand extensions of their products.

One such company is Zippo, the world's largest manufacturer of lighters, which will complete its 80th anniversary this year. The US-based lighter maker is now looking at products beyond lighters in the Indian market and is also planning its first ever exclusive outlet in Mumbai followed by Delhi.

Zippo is currently available at 150 retail points in India.

Zippo is focusing not just on the high-end windproof lighters, which contributes 53 per cent to the company's total turnover, but on a range of lifestyle products such as watches, perfumes, leather accessories, apparels, travel bags, backpacks, watches, sunglasses, wallets, pens, liquor flasks, outdoor hand warmers and even playing cards.

"We do not have any exclusive outlet anywhere in the world but will set up our first ever store in Mumbai. We are already in talks with a Mumbai-based listed developer to set up a 1200 sq ft exclusive outlet in the city," the company's director for global marketing, David B Warfel, said.

He also added that the company is looking setting up 3 flagship stores in India in the next 18 months, thus pointing out the importance of Zippo's presence in the Indian market. Currently, India contributes only 4 per cent to the global sales and the company is expecting a growth of 2.5 times in the next 5 years.

"We se a huge potential in the Indian market and hope that it can rival China in terms of volume and value over the next 5 years. At present 10 per cent of our overall sales comes from China," Warfel said.

Warfel said the growth will be coming in from the Zippo-branded lifestyle products. "Our customers are mainly the urban youth and women, who buy our products to gift them to their male counterparts."

Apart from lifestyle products, the other two important categories, that the company wants to focus are home decor and camping supplies, that includes products like grills, tents and handwarmers to name a few.

Zippo entered the Indian market 5 years back with RBT Trading Company as its local distributor. However, the company wants to continue with the partnership as it helps them to understand the local market better and provide a broader distribution channel.

Zippo already sells its lighters in more than 160 countries through  wholesalers and other distributors.

While, Warfel did not divulge the investment details in India, he added that the company has tripled its marketing expenditure in the last three years and the investment will continue to grow in 2012 with the key focus on the top 10 cities of the country.

Currently, the Zippo products are imported from its manufacturing facility at Bradford in Pennsylvania and partly  from  Italy, China, Japan and South Korea.

Brand experts feel that it makes sense for the company to extend its product line beyond just lighters as globally the anti-smoking laws are getting stringent. However, it is just testing waters and hence too early to comment on whether the strategy will work.

However, Warfel feels that Zippo plans to  stick to products closer to its  core products.

Zippo will initially  push its expanded product line in the overseas market as the foreign consumers though familiar with the brand are ready to experiment with other products as they are not stuck to its "only lighter" image. It expects 60 per cent of the business coming from outside the US market, Warfel said.