Famed American fashion designer Michael Kors is keen to invest in India. Mr. Kors, revered by the rich and famous for his classic women's sportwear, adorned by the likes of Michelle Obama and Cate Blanchett, is keen to tap the small but growing Indian luxury retail market. Cracking the Indian market can be a difficult proposition and I believe he'll needs some sound advice on how to devise a suitable branding strategy. So, here I am, at your service Mr. Kors.
The first step to successful marketing of the Kors brands in India would be to enter into a licensing agreement with a local company. Local regulations allow 51% majority ownership by foreigners of single brand retail ventures and Mr. Kors should take advantage of this. Entering into a license agreement with a well-known local company has a number of advantages.
- Economics - First of all, the economics of the licensing process is lucrative. The local partner would know the target segments and can market the brands accordingly through a variety of channels. Mr. Kors doesn't need to spend a fortune on setting up distribution channels.
- Control - Mr. Kors retains control over the licensing joint venture with the 51% holding.
- Coverage - Where should the stores be opened? Does a huge investment in standalone stores make sense at the initial stages of the business? I don't think so. Rather, Mr. Kors should test the market by opening a couple of stores in five-star hotels or malls in cities such as New Delhi and Mumbai. Contact between the brands and customers is an essential tool for successful marketing and branding and Mr. Kors should facilitate this. I'm pretty sure that the rich and famous in these two cities are already quite familiar with the content, i.e. they already recognize the Kors brands. But, even if they don't, the stores in places such as the Oberoi in New Delhi and Taj Mahal Hotel in Mumbai would bring them closer to the brands. In any case, these hotels witness a steady stream of rich local and foreign businessmen and travellers so I think Mr. Kors would already have a large potential clientele here. You can't really ask for a better testing ground for luxury brands. Following the steady build-up of brand loyalty, driven by the product quality, customer service as well as tv ads, social media marketing etc, Mr. Kors could open standalone stores in upmarket localities in the two cities.
Now, I have made the suggestions based on the successful experience of other luxury retailers in India over the last four years. For instance, Hermes opened their first store in New Delhi's Oberoi hotel in 2007. They had a 51:49 licensing JV with Khanna Specialty Retail, who handled marketing and distribution of products such as the Birkin and Kelly bags. And, Hermes opened their first standalone store in Mumbai earlier this year after sufficient market testing.
Since this a path well-travelled by other big players, Mr. Kors could also benefit by trying it out. As the saying goes, "Don't change unnecessarily what is already working."
The first step to successful marketing of the Kors brands in India would be to enter into a licensing agreement with a local company. Local regulations allow 51% majority ownership by foreigners of single brand retail ventures and Mr. Kors should take advantage of this. Entering into a license agreement with a well-known local company has a number of advantages.
- Economics - First of all, the economics of the licensing process is lucrative. The local partner would know the target segments and can market the brands accordingly through a variety of channels. Mr. Kors doesn't need to spend a fortune on setting up distribution channels.
- Control - Mr. Kors retains control over the licensing joint venture with the 51% holding.
- Coverage - Where should the stores be opened? Does a huge investment in standalone stores make sense at the initial stages of the business? I don't think so. Rather, Mr. Kors should test the market by opening a couple of stores in five-star hotels or malls in cities such as New Delhi and Mumbai. Contact between the brands and customers is an essential tool for successful marketing and branding and Mr. Kors should facilitate this. I'm pretty sure that the rich and famous in these two cities are already quite familiar with the content, i.e. they already recognize the Kors brands. But, even if they don't, the stores in places such as the Oberoi in New Delhi and Taj Mahal Hotel in Mumbai would bring them closer to the brands. In any case, these hotels witness a steady stream of rich local and foreign businessmen and travellers so I think Mr. Kors would already have a large potential clientele here. You can't really ask for a better testing ground for luxury brands. Following the steady build-up of brand loyalty, driven by the product quality, customer service as well as tv ads, social media marketing etc, Mr. Kors could open standalone stores in upmarket localities in the two cities.
Now, I have made the suggestions based on the successful experience of other luxury retailers in India over the last four years. For instance, Hermes opened their first store in New Delhi's Oberoi hotel in 2007. They had a 51:49 licensing JV with Khanna Specialty Retail, who handled marketing and distribution of products such as the Birkin and Kelly bags. And, Hermes opened their first standalone store in Mumbai earlier this year after sufficient market testing.
Since this a path well-travelled by other big players, Mr. Kors could also benefit by trying it out. As the saying goes, "Don't change unnecessarily what is already working."
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