AgTalk | On an expansion drive: Lacoste's Rajesh Jain

Lacoste, a leading French lifestyle brand which was built on its genuine sporting roots, offers a unique and original universe through a wide range of products for men, women and children. Lacoste S.A. formerly known as La Societe Chemise Lacoste founded in 1933 and  based in Paris coordinates eight worldwide licenses granted to various partners and offers a range of products which includes apparel, footwear, fragrances, leather goods, eyewear, watches, fashion jewellery and home textiles. In 2010 the brand achieved a wholesale turnover of 1.4 billion Euros. Present in 114 countries, two Lacoste products are sold every second through their boutiques, department stores and a selective distribution network. Nearly 80 years after its creation, Lacoste has become a lifestyle brand, combing elegance and casualness.

Lacoste India, which began its India operations in 1993, is a strategic alliance between Lacoste and the Delhi-based Turner Morrison group. Since then, the brand has evolved from a men’s Polo centric brand to a complete lifestyle brand. Playing a low profile, the brand has undergone changes in the Indian market context. Over the last five years, it has begun offering at larger format stores in key metros and has expanded their key boutiques in Mumbai, Delhi, Chennai Hyderabad and Pune. In India, the brand is available across boutiques and multi-brand outlets.

Rajesh Jain, Director & CEO Lacoste India, holds a Master of Commerce degree from the University of Delhi and is a Chartered Accountant from the Institute of Chartered Accountants of India. He joined Lacoste India (Sports and Leisure Apparel Limited) as CFO in the year 2005. His managerial and business development experience across 

industries spanning more than 20 years has earned him a reputation for innovation and leadership. The most important lesson he has learned is: “work hard and draw a balance between working for a living and living for work”. He is managing India operations for the brand and is responsible for Top Line, Bottom Line, Growth/Expansion, Customer Delight and Human Resource Development.

In conversation with Adgully, Rajesh Jain, Director & CEO, Lacoste India shared about the USP and growth of the brand, the company’s India related plans and much more

Adgully (AG): Lacoste is an 80 year old French brand. Please brief us about the brand's journey and performance in India? 

Rajesh Jain (RJ): Over the years Lacoste has evolved from a men’s polo centric brand to a complete lifestyle brand. We now offer a complete wardrobe for men, women & kids. Apart from apparel categories like polo’s, t-shirts, shirts, trousers, denims, sweaters, jackets, track suits and so forth, we also offer sports fashion footwear, bags for men and women, fragrances, sunglasses, belts and other accessories like contemporary jewelry, swimsuits, caps, socks and mufflers.

This change is not only visible in the collections but the complete marketing mix. With larger format boutiques offering a wide collection and a luxury shopping experience as opposed to smaller stores earlier, the Lacoste brand has certainly come a long way in India in keeping with the growth of the retail segment in the country. The recent Unconventional Chic brand campaign resonates with the evolved Indian consumer and the evolution of the brand into an affordable luxury-lifestyle brand. However, what did not change and would never change are the core values of Lacoste – comfort, timeless, simplicity and elegance.

Lacoste recognizes change in the Indian market and has effectively adapted over the years. Nowadays the Indian consumer is much more aware and expects the same buying experience that a consumer gets in the US or Europe, which we strive to offer in all our stores in India.

From a small store format to flagship boutiques; from quintessential polo brand to multiple category lifestyle brand – Lacoste has remained one of the top aspirational brand for the discerning consumer in terms of quality, fit and style. The brand has received a positive response to initiatives on product, advertising, new boutique launches and has thus grown steadily in the last 15 years. Even during recession when many brands had to close shop or scale down, Lacoste continued to enjoy its consumer patronage.

As an increasing number of Indian consumers have started identifying themselves with Lacoste, the brand has also successfully attracted the new age younger consumers through trendier products and new flagship boutiques. 

AG: Lacoste being a renowned brand worldwide, which are the biggest markets for the brands?

RJ: Lacoste operates a large number of Lacoste boutiques worldwide; located as concessions in leading department stores and also as independent venue stores with more than 1100 boutiques and more than 2000 corners in departmental stores.  It has a worldwide presence in 114 countries.

AG: Can you please share with us your India related plans?

RJ: India is a very serious market for Lacoste as the consumer is also slowly showing signs of trading up between uber premium – bridge to luxury brands. Earlier Retail was mass to premium segment dominated but now the spectrum is changing. Bridge to luxury brands are making their way into India, increasing awareness of the consumer who is eager to sport styles that set him/her apart from the crowd. In our opinion, while Tier 2 markets will see heavy up-rise in the premium category, bridge to luxury brands like ours will continue to mushroom in metros and big cities as they slowly find in-roads into select Tier II markets. We have 41 points of sale in India and 1 in Maldives which is managed by the Indian entity. Lacoste is present in 14 cities with about 60,000 sq. feet of retail space, selling one Lacoste merchandise every 2 minutes! Delhi & Mumbai are our core markets.

We are also working towards upping our distribution in Kolkata, Punjab and Gujarat by adding medium to large size boutiques.  Amritsar and Surat are two new catchments we would like to explore as we have now placed ourselves in Jaipur and Kolkata in the recent months. Simultaneously, we are closely evaluating the developments in the next tier cities like Cochin, Ahmedabad, Jaipur, Ludhiana, Lucknow, Surat etc. both in terms of consumer demographics and psychographics, mapping relevant retail developments.

AG: How is the market different in India in comparison to markets abroad?

RJ: India is a different market than most other parts of the world. The retail occupation costs are as high as any other international destination and yet you cannot price your products at international levels. On the top of it if you don’t have a local sourcing, it could burn irreparable holes in your pocket.

Lacoste in India has an advantage of domestic manufacturing. We have a plant located in NCR that delivers international quality products and that helps us maintain our margins. This, apart from robust systems and processes with a committed team results into consistently growing top line without compromising on bottom line.

AG: What is your view about the domain you are in? How would you rate the overall performance of the domain today?

RJ: The Indian consumer is evolving and driving retail growth with increased consumption patterns every year. The apparel market in India has moved from un-branded and unorganized retail to branded and organized systems. There has been a constant move from lower to mid to premium to luxury segmentation in the industry. The luxury market in India is about USD 100 Million industry. Out of this the premium wear segment is at present a small market with few competing brands. This segment is expecting to grow at 13% every year to reach USD 190 Million by 2015.

Looking at these numbers, one cannot deny the fact that retail sector is indeed opening up unprecedented opportunities and the  move towards opening up of FDI in Retail can only result in further push to this growing sector.

AG: What sets Lacoste apart from other brands? What's your edge over competition?

RJ: We take competition in a very healthy and positive manner. With the introduction of many international luxury and premium brands in the Indian market Lacoste remains an exclusive brand, building on its strong heritage roots of sports, innovation and elegance. Hence all our products follow the legacy of style and quality and further blends that with the latest trends and fashion.

On communication front, continuing our brand legacy with Rene Lacoste, all our communication efforts follow a globally synced strategy. The brand, taking inspiration from its heritage supports and signs sporting celebrities who have an international appeal or have the elegant personality in league of the brand image, hence we in India follow the same paradigm.

In our brand stores the emphasis has also been to provide a superlative brand experience through larger stores with new interiors and a very professional and yet luxurious personalized shopping experience. The brand was always positioned as an uber premium brand, and has today created its own niche as an affordable luxury brand, in the dynamic Indian market.

AG:  What is the key USP of Lacoste which has been carried forward through the decades?

RJ: We enjoy a very strong brand loyalty generated through an extremely positive post purchase delivery of the product & brand prestige. Horizontal and vertical expansion has helped us in increasing the market share. The retail industry is very fragmented and there is no syndicated study to establish market shares, however we are definite that Lacoste is certainly the leader in POLOs in the affordable luxury segment.

AG: Last year seemed to be sluggish, what was its impact on your business? What are your short term and long term plans to tackle such situations?

RJ: In FY 11-12 Lacoste grew by 33% followed by 25% in FY 12-13 and this year we are confident of growing at 25-30%. Yes the slowdown has affected the retail industry indeed however this has been observed across industries. While Lacoste does not remain untouched by this phenomena but we are not hard hit by the slump in the economy. Our customers continue to patronize the crocodile brand with the same fervour.  We have observed decline in footfall but at the same time spending has not decreased drastically. The consumer is better home worked, knows what to buy and does not spend too much time contemplating or making choices. Planned purchase in on the rise and therefore the challenge on the table is to break any pre-conceived notion that the customer walks with when he/ she enter the store.

Lacoste has not changed the expansion plan for doubling up its POS in the next 4 years as this is a long term strategy and we are pretty much gunning to complete the task.

AG:  Please share about the growth witnessed by the company in the last 5 years and what is the growth you foresee in the near future?

RJ: We are very glad to share that we grew 33% on our top line a year before last and grew 25% in last FY. In the current financial year also we target to grow by 25% to 30%. This is a decent growth rate considering the slow market and increased competition. We are perhaps one of the few international brands in the country that have continued to remain healthy on bottom line as well.

AG: Social and digital media also play an important role today when it comes to marketing and promotion. So, how is the brand Lacoste India being placed on these mediums?

RJ: Extensive use of internet , accessible overseas travel, rising E commerce, Mobile friendly platforms , popularity of social networking  are encouraging educated Indians to look well turned out, experience new avenues, experiment with  unconventional mind sets and yet emerge as confident individuals.