Increased challenges from international footwear giants coupled with stiff competition from the local, unorganised sector and regional players, had all cut into the market share of Bata India. That was around three years back. Bata did not give up, although margins came under pressure. It closed unviable units, separated employees through VRS, realigned product lines and recast its store strategy to claw back. Excerpts from an interaction with CEO Sandeep Kataria .
How did Bata manage to bounce back?
The cornerstone of our strategy was — Sweeping Angela off her feet. Angela is the name given to our ideal consumer, identified based on consumer research. Once we knew Angela, concerted efforts were made towards creating a Bata world that was customised for her.
The first step was placing the ‘product is king’ philosophy at the centre of all our efforts and introducing styles that were relevant to millennials and the youth. With products that stem from consumer understanding, we carved our niche in the market, forcing reconsideration among urban India.
Seamlessly reaching and winning across India through retail, franchisee and e-commerce-led omni-channel, we made Bata accessible to all.
Along with product and supply chain, focussed efforts were made towards improving customer experience through enhanced store ambience with contemporary collection and wide choice. While we are focussing on our larger objectives, we are making conscious efforts towards setting and achieving our sustainability goals.
What steps are being taken to ensure the sustainability of the 2018-19 numbers in terms of top line and bottom line?
Steps are the same as above. It is a five-year strategy and we are on year three already. While the core pillars of the strategy remain the same, the dynamic, socio-economic environment may call for timely reviews.
How much did control of costs and expenses help boost profit?
Indeed, cost-saving efforts have yielded results in improving the bottom line and leveraging economies of scale. Right-sizing and re-negotiating the store costs have been two key levers of our cost control measures.
How many pairs does Bata sell annually?
Approximately, 50 million pairs are sold annually.
Has the GST roll-out helped in expanding the market for organised players?
Implementation of GST has been helpful in using our inventories more productively and removing State-specific barriers, allowing us to service customers from anywhere to anywhere.
You said that staying contemporary was the biggest challenge.... how are you meeting this challenge?
It is an ongoing process of ensuring relevant marketing and communication based on customer insight, backed by the regular introduction of contemporary collections. In fact, we are currently driving an ‘industry-first’ practice of ensuring all our stores get new arrivals every Friday.
What is your view on premiumisation?
The Indian consumer is evolving and increasingly aspires for global fashion trends and is ready to pay a premium once they see value in the product. With an eye on changing consumer demands, we have increased the width and depth of our product offerings.
Employing technology-backed innovations such as memory foam in walking shoes, OrthoLite across sub-brands and Life Naturals in our school shoe range helps attract consumers who aspire for fashion with comfort.
We are innovating with materials and processes to deliver a more premium product to our customers.
We will keep expanding both the formats (own stores and franchises).
Each format will target different geographies and hence, result in a major expansion across regions.
Your policy on digital sales?
Digital plays an integral role in our strategy.
From direct connect with consumers through Bata.in, to presenting our extensive offering on partner platforms, we are able to leverage our inventories more productively across online and offline. Through partner platforms, we are able to penetrate into larger number of towns thereby making fashion accessible.
You have launched a pilot to go paperless ?
We have a strong belief in having a clear sustainability objective and we are continuously looking to reduce, reuse and recycle. My belief is 95% of Indians are ready to go the extra mile to help the environment, if presented with the option. We have initiated the process of e-invoices to reduce paper wastage among other initiatives at store and factory-level.
What about the recent campaign on bringing back old shoes. Is there a discount to be availed here?
This was a pilot that was initiated in two cities as part of our CSR which delivered great results.
