Titan company‚ the country’s largest branded watches and jewellery maker, has adopted an aggressive strategy to transform its core business over the next three years. Titan—that has its roots in traditional watches and is a part of the salt-to software conglomerate Tata group—is increasingly betting on the relatively new smartwatch market to more than double its revenues from the watches business segment.
After diversifying into wide-ranging categories, from perfumes to sarees over the last decade, the Bengaluru-based company is intensifying its focus on the local smartwatch market that has been the playground of smaller domestic start-ups and global giants until recently. While it already had a wide portfolio of traditional watches serving all age groups and purposes, it was only after the pandemic that Titan started focussing on the rapidly growing category. Since the Covid-19-related restrictions were lifted in 2021, Titan has launched multiple smartwatch product lines, such as Titan Smart, Titan Smart Pro and Fastrack Reflex Vox.
According to Suparna Mitra, CEO of the Watches and Wearables division at Titan Company, the vertical aims to more than double its revenues to Rs 10,000 crore by FY26. In FY20, before the full impact of the pandemic, it had raked in `3,996 crore from this division. But after a major dip in sales in FY21, the watchmaker had managed to recover to 90 per cent of FY20 levels in FY22. In FY23, Mitra says, Titan has managed to increase the net sales value of the segment by 44 per cent year-on-year during the first nine months.
So far, Titan’s focus on the smartwatch market seems to be paying off. Per data from market research firm IDC India, the company’s smartwatch shipments grew nearly 40x during CY22, compared to 2021. As a result, it became the fifth-largest smartwatch seller in India last year with a 2.4 per cent market share, from 0.1 per cent in 2021.
“The smartwatch segment contributed around 10 per cent of [Titan’s] watch segment revenues. The company is charting out a path to target triple-digit growth in the smartwatches segment, considering its huge potential,” noted analysts from ICICI Direct, adding that the company is adding advanced features and designs to its smartwatches under the Fastrack and Titan brands and also looking at providing an enhanced customer proposition.
Titan’s interest in the smartwatches category is not without rationale, too. Data shows that in 2022 the local smartwatch market grew by a whopping 153 per cent year-on-year by units shipped. From some 12.22 million units in 2021, it jumped to 30.72 million units last year. Cracking the market, however, won’t be easy, given its late entry into the category. And with the market being dominated by dedicated smartwatch and smart wearable players like Noise, Boltt and boAt—who have together cornered 71 per cent of India’s smartwatch shipments—Titan has its task cut out. Even the premium segment—priced above Rs 25,000, with less than 15 per cent of the market—is dominated by global leaders like Apple, Samsung and Fitbit.
Mitra, however, has a plan. To counter the onslaught of global giants and local start-ups, she has adopted a two-pronged strategy. “The smartwatch market has exploded in the past two years. At the top of the market, there are brands like Apple, while at the bottom there are multiple local brands. So, we are positioning Fastrack in the Rs 2,500-6,000 price range, followed by brand Titan, starting at Rs 6,500 and going up to Rs 15,000. We believe, this is a space where a lot of Indian consumers would like to make their next purchase,” she says.
And to strengthen its innovation pipeline, Titan had acquired HUG Innovations, a Hyderabad-based start-up, in 2020. Since then, it has been rebranded as Titan Smart Labs and been fully integrated into the company’s ecosystem, with its 80-member team. This team is deeply involved in “fundamental innovations” that have resulted in a range of new products. These have begun to bear fruit. As per the company, new products contributed around 20-22 per cent towards its sales from watches across all channels in 2022.
“The Rs 10,000-crore sales target by FY26 is very ambitious and the greater contribution of smartwatches has been accounted into it. The category is exploding around us and we are going to work our way into a leadership position,” says Mitra. Looks like the time is right for Titan.
@arndutt
