[Pgp30380]_BM_Sec B_p2
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ITC is one of India's most valuable companies with a market capitalization over $40 billion. It has established several world class brands in the last 10 years, including Wills, which is its cigarette brand. Wills Lifestyle was launched in 2000 as ITC's lifestyle retailing brand to diversify from cigarettes as regulations and taxes were increasing. Wills Lifestyle positions itself as a premium brand and has over 100 exclusive stores across major Indian cities. It has expanded into personal care products like fragrances and bath products to strengthen its lifestyle image.
[Pgp30380]_BM_Sec B_p2
- 1. WILLS BRAND EXTENSIONS ASSIGNMENT PROJECT GUIDE: PROF. SAMEER MATHUR Submitted By: Mehak Jindal | PGP30380 | PGP2 | Term IV | BRAND MANAGEMENT Course |Section - B
- 2. ITC – The Company One of India’s most Admired and Valuable company -Market Capitalization: over US $ 40 Bilion A USD 8 billion enterprise by Revenue - ~58% of Net Revenue from non-Cigarette segments Leading Fast Moving Consumer Goods marketer in India - Established several world class brands in the last 10 years The only Indian company to feature consistently amongst the Top 10 global FMCG companies Only Indian FMCG company to feature in Forbes 2000 List 10-07-2015 WILLS – BRAND EXTENSION 2
- 3. ITC’sBusinessPortfolio 10-07-2015 WILLS – BRAND EXTENSION 3
- 4. ITC’sBrandsforIndian Consumers 10-07-2015 WILLS – BRAND EXTENSION 4
- 5. Source: Audited Financial Results, ended 31st March 2015, http://www.itcportal.com/about-itc/shareholder-value/key-financials/quarterly-results.aspx 41% 21% 3% 19% 12% 4% Segment Revenue FMCG - Cigarettes FMCG - Others Hotels Agribusiness Paperboards, Paper & Packaging Others ITC Category Wise Segmentation Profit After Tax Cigarette FMCG Business still generate 80-85% of ITC’s profit. Non-Cigarette FMCG business is lowering losses every year and it is expected to breakeven in 2014-15. The segment's losses declined from Rs 195.49 crore in 2011-12 to Rs 81.26 crore in 2012-13. 10-07-2015 WILLS – BRAND EXTENSION 5
- 6. WILLS WILLS – ITC’S CIGARETTES BUSINESS ITC is the market leader in cigarettes in India The Wills brand is estimated to be worth Rs 1,500 crore and is second only to Gold Flake, also owned by ITC, which is valued at nearly Rs 2,500 crore Segment-wise Gross Revenue of FMCG-Cigarettes is 41% Cigarettes still generate 80-85% of ITC’s profit ITC’s cigarette sales by volume were estimated to have shrunk 9% year-on-year WILLS LIFESTYLE - ITC’S LIFESTYLE RETAILING ITC's share is not more than 4% in the apparel retail Top-of-the-line garments Wills Lifestyle plus John Players -- contributes a little over 2 per cent of ITC's FMCG business Segment-wise Gross Revenue of FMCG-non Cigarettes is 21% . Wills Lifestyle contributes 60% to ITC's lifestyle retail revenue Wills Lifestyle contributes almost 80% to ITC's lifestyle profits Increasing average billing value by 15-20% year-on- year with a more premium mix 10-07-2015 WILLS – BRAND EXTENSION 6
- 7. Why Brand Diversification? High incidence of taxation and a discriminatory regulatory regime on cigarettes in India The share of legal cigarettes in overall tobacco consumption has progressively declined from 21% in 1981-82 to below 12% in 2014-15 even as overall tobacco consumption has increased in India The declining sales of cigarettes, the proposed ban on advertising (Prohibition of Advertisement and Regulation Bill 2001), the increasing anti-tobacco campaigns and the experience in developed countries seemed to suggest that tobacco would no longer be a profitable business in the future ITC decided to diversify into non tobacco businesses ITC's diversification, especially into areas such as branded garments, aimed at improving its brand image, which, in turn, may help it grow its core business The lifestyle retailing business grew revenue by 20% in 2013-14. The premium-end of the market which was earlier only 5 per cent has grown to about 10-15 per cent of the whole market share 10-07-2015 WILLS – BRAND EXTENSION 7
- 8. Indian Apparel Retail - Category Growth 10-07-2015 WILLS – BRAND EXTENSION 8 India apparel retail industry value: $ billion, 2010–14 Source: Marketline
- 9. 10-07-2015 WILLS – BRAND EXTENSION 9 India apparel retail industry value forecast: $ billion, 2014–19 SOU Indian Apparel Retail - Forecast Source: Marketline
- 10. WILLS LIFESTYLE In 2000, ITC entered the lifestyle retailing space with the launch of Wills Lifestyle. Wills Lifestyle has established a nationwide presence with upmarket product range available in exclusive 104 Wills Lifestyle stores across 44 cities and more than 500 ‘shop-in- shops’ in leading departmental stores and multi-brand outlets Core Values: Elegance, sophistication and exclusivity Imagery: International premium quality and vitality Tagline: Enjoy the Change 10-07-2015 WILLS – BRAND EXTENSION 10
- 11. 10-07-2015 WILLS – BRAND EXTENSION 11 4 P’s of Marketing Mix Product 2000 Racy stripes, energetic prints and trendy dobbies 2002 New age work wear, trendy, innovative, chic and stylish; Rreflects the work ethos of gen next 2003 Sensuous satin and sequins embellished on jacquards and alluring prints 2006 a tribute to the evolved consumer’s fashion sensibilities; Created by the leading stylists Relaxed Wear Formal Wear Evening Wear Designer Wear
- 12. Wills Lifestyle is considered as a brand that is at the forefront of fashion It positioned itself in the premium category In 2007 it was named amongst the Top Luxury Brands of India by Time magazine Thus, it is able to charge a premium from its customers. The Pricing of WILLS LIFESTLE Products is High. e.g. Men’s Shirts : Rs. 1500 – Rs. 5000 10-07-2015 WILLS – BRAND EXTENSION 12 4 P’s of Marketing Mix Price
- 13. Exclusive 104 Wills Lifestyle stores across 44 cities More than 500 ‘shop-in-shops’ in leading departmental stores and multi-brand outlets The online stores - The chunk of online customers is very small, approximately only 5 per cent of the whole Plans to scale up its retail presence through a mix of more stores in existing markets and expanding the footprint in smaller markets through the franchising model 10-07-2015 WILLS – BRAND EXTENSION 13 4 P’s of Marketing Mix Place
- 14. 10-07-2015 WILLS – BRAND EXTENSION 14 4 P’s of Marketing Mix Place
- 15. Loyalty programme – Club Wills The sponsorship of the prestigious Wills Lifestyle India Fashion Week Tie-ups with leading stylists of the country: Anamika Khanna, Ashish Soni, Manish Malhotra, Manish Arora and Shantanu-Nikhil In 2008, developed a campaign voicing the thought 'The World Wants to be You.' The intent has been to take consumer interest in the brand to a new high https://www.youtube.com/watch?v=qXXtpdKugos 10-07-2015 WILLS – BRAND EXTENSION 15 4 P’s of Marketing Mix Promotion
- 16. WILLS – Personal Care Products FURTHER EXTENSION To strengthen the lifestyle statement, Wills Lifestyle launched: Essenza Di Wills range (2005) Fiama Di Wills range (2007) - A range of fine fragrances - A collection of bath and body care products and grooming products and complementing accessories 10-07-2015 WILLS – BRAND EXTENSION 16
- 17. References 1. ITC Corporate Presentation, Available at:http://www.itcportal.com/about-itc/shareholder- value/ITC-Corporate-Presentation.pdf(Accessed: June 29, 2015) 2. ITC: Building World-Class Indian Brands, Available at:http://www.itcportal.com/businesses/pdf/brand-booklet.pdf (Accessed: June 29, 2015) 3. (March, 2015) Retail Industry in India, Available at: http://www.ibef.org/industry/retail- india.aspx (Accessed: June 30, 2015) 4. Database, Available at: http://advantage.marketline.com/ (Accessed: July 9, 2015). 5. Wills Lifestyle, Available at: http://www.superbrandsindia.com/images/brand_pdf/consumer_3rd_edition/Wills%20Lifestyle. pdf (Accessed: June 30, 2015) 10-07-2015 WILLS – BRAND EXTENSION 17
- 18. References 6. T R Vivek (2004) 'Tobacco ban forces ITC to stub Wills', Business Standard, 21st July 7. Manish Basu (2015) 'ITC to raise prices of all its key cigarette brands', Live Mint, 13th March 8. NAMRATA ANAND, VANDANA KHETARPAL, (2014) 'GROWTH OF APPAREL INDUSTRY IN INDIA: PRESENT AND FUTURE ASPECTS ', , II(I) 9. Sreeradha D Basu (2010) ''We try to make fashion more accessible'', The EconomicTimes, 21stA April 10-07-2015 WILLS – BRAND EXTENSION 18
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