Opportunities for Denim in Young India

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"Opportunities for Denim in Young India" | This interesting presentation takes a look at the current denim consumption and deliberates on the way forward to maximise its potential. Enjoy reading it and let us know what you think…

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  • Industries-Gaming: Rs. 400 cr (2007) grown at CAGR 35% to reach Rs. 1,400 cr (2011)Cafes’: Rs. 275 cr (2006) grown at CAGR 30% to reach Rs. 1,000 cr (2011)Deodorants: Rs. 300 cr (2005) grown at CAGR 30% to reach Rs. 1,400 cr (2011)Companies-Puma: Entered India in 2005 & grown at CAGR 180% to reach Rs. 540 cr (2011)Sparx: Rs. 1.5 cr (2008) grown at CAGR 130% to reach Rs. 17 cr (2011)Fastrack: Rs. 30 cr (2005) grown at CAGR 60% to reach Rs. 320 cr (2010)
  • Opportunities for Denim in Young India

    1. 1. Opportunities for Denim in YOUNG India Arindam Saha Associate Director Wazir Advisors, IndiaInDIGO 2012, NOIDA, 30th August 2012
    2. 2. It’s a YOUNG India… 50% of total Indian population will remain in the age group of 15 - 45 Population Breakup(All figures in Millions) ~1350 Median Age 2011 ~1100 ~1200 67 58 55 275 India 208 178 194 26 Years 151 160 190 210 180 China 212 220 238 36 Years 343 350 363 US 2005 2010 2020 (P) 37 Years 0-14 15-24 25-34 35-44 45-64 65+ Source: NCAER Source: CIA Factbook
    3. 3. Becoming more casual & enjoying life  Let’s have party…  Casual dress code for Friday…  Will go out this weekend…  Let’s catch up at CCD…  Will update in FB…  Live like a bird…  If you have it… Flaunt it…  Come in semi formal…  Let’s play…
    4. 4. Denim is the perfect match for them…
    5. 5. Denim market will grow on strong fundamentals…  It’s Official Now: Denim being accepted as office wear in India’s IT Denim Market Size and BPO sector (In Cr) 14,000 12,200 12,000  No more a Western wear: Increasing 10,000 number of women wearing denim CAGR 8,000 15% especially teaming up jeans with 7,000 ethnic wear 6,000 4,000 2,000  Penetrating Kids wear segment: Brands like Disney, UCB Kids are 0 2011 2015(E) increasing their focus on denim. Influence of these brands is initiating purchase of denim within kids and grown up segmentsSource: Wazir Analysis
    6. 6. But the consumption level is still low… Per Capita Consumption of Denim India China USA 0.2 Pairs 1 Pair 8 Pairs
    7. 7. Present market size is just the tip of the iceberg Current consumption: 250 mn denim pairs Total Population = 1.22 billion Core Target Group (15-44) = 48% i.e. 585 mn people Potential consumption: Avg. Consumption: BILLION + denim pairs 2 pairs
    8. 8. Other youth focused industries / companies are growing faster Industry CAGR Company CAGR Revenue growth of 35% Revenue growth of 180% Gaming from 2007 to 2011 from 2005 to 2011 Revenue growth of 30% Revenue growth of 130% Cafes’ from 2006 to 2011 from 2008 to 2011 Revenue growth of 30% Revenue growth of 60%Deodorants from 2005 to 2011 from 2005 to 2010
    9. 9. Way Forward…
    10. 10. Penetrate deeper and widerDenim Brands No. of Cities 425 Urban TownsTommy Hilfiger 25UCB 75 62% of urbanNumero Uno 75 populationLevi’s 125 City types and no’s:Spykar 250 4 AAA, 4 AA, 16 A, 36 B, 55 C, 116 D 194 E Denim Brands No. of POS* Name No. of Outlets Tommy Hilfiger 125 Café Coffee Day 1,350 UCB 350 The Mobile Store 1,300 Numero Uno 145 UniverCell 1,000 Levi’s 400 Spykar 1,200 Explore more opportunities beyond the Tier 1 Cities and expand network in existing cities too * Point of Sales
    11. 11. Create more ‘Occasions’ for denim usage Offered cards for every mood, birthdays, anniversaries, etc.Early 1990’s targeting teenagers and young adults The first one to introduce Mothers Day, Fathers DayLate 1990’s and Valentines Day in IndiaEarly 2000 Cards for Jobs - Well Done, Good Luck, Promotion and Farewell Started off Daughter’s Day and other non-traditional occasions likePost 2005 Boss’ Day, Doctor’s Day and so on. Revolutionize the industry, the way Archies has done for the gifting industry – new associations, new occasions and new product lines
    12. 12. Create a range of ‘Affordable’ denim garments Market segmentation: Denim Indian Consumers Segmentation Super Above Rs. 3,500 Million HH Income (in Rs ‘000) Premium Premium Rs. 1,500 – 3,500 Medium Rs. 800 – 1,500 Economy Rs. 500 – 800 Unorganized Rs. 250 Rs 1,200 – Rs 30,000 Brands have presence across Rs 1,700 – Rs 42,000 the price spectrum
    13. 13. Explore newer models like Brick & Click Online retail market in India, in Rs crores 7,000 CAGR: 37% 2,000 2011 2015 (e) No missed sale due to non-availability of desired size Active online shoppers in India, in Lacs Larger variety can be displayed with 380 better visual merchandising CAGR: 43% Minimum inventory carrying costs and real estate costs 90 Cost savings can be passed on to consumers as discounts 2011 2015 (e)
    14. 14. Thank You… Arindam Saha Associate Director Wazir Advisors, Indiaarindam.saha@wazir.in | +91 9810677443

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