Financial Daily from THE HINDU group of publications
Monday, Nov 08, 2004
Marketing - Retailing
Benetton plans string of megastores `Focus in India to remain on distribution, retailing'
Mr Luciano Benetton.
Bangalore , Nov. 7
MR Luciano Benetton, Chairman and Founder of the Benetton Group, sees India possessing adequate speed and modernity that would enable its brand, United Colours of Benetton, to generate significant business in the near future.
The Italy-based fashion icon is planning to spearhead a string of visible high street megastores across the country, almost 20 of them by the end of 2007, through the franchisee route.
Benetton recently bought out the stake owned by the DCM group in a 10-year-old 50:50 joint venture company to set up a 100 per cent subsidiary. The Benetton chief knows that his fashion business had had a quiet stint in India and that now is the time for a big push.
"In the past 10 years, the legislations and regulations in India were tight. We needed that kind of time to establish ourselves in tune with the local rules. I think India has realised it is time to move ahead with greater speed. It has the velocity, speed and modernity, as in the rest of the world. We have a vision for India starting this moment," Mr Benetton said.
He feels Benetton needs to be present in a very focused and strong way in markets such as China and India.
"Both of them comprise half of the world and we need to come here," he said. Mr Benetton opined that the Indian consumers were geared up to adding foreign brands to their sensibility.
"To make a rational argument, they know that fashion is created and born in Europe, and, therefore, a European brand has a better chance of appealing to the consumer," he explained, quickly adding: "The Indians are not going to stop buying the local brands."
Benetton currently operates 61 stores across India, and those that do not conform to the brand's international stature will be closed down or renovated. "In the next one year, we are going to have six mega stores, and about 20 by the end of 2007. These will be huge, grand stores for the complete family." The Benetton head is on a whirlwind tour to India covering New Delhi, Mumbai and Bangalore.
"I have visited this country four or five times earlier, and at least two of it was purely personal visits. I have been to Rajasthan and other parts of northwest India, and I found the colours and traditions here very appealing," he added.
However, the outsourcing bug does not bite Mr Benetton. "We have no intention to shift our production facilities from Europe. But it does not exclude the fact that in the future we may export products that are manufactured here. Our focus in India will remain on distribution and retailing, and this way we get to know suppliers and manufacturers much better," he said.
The fashion clothing line that Benetton sells through its stores in India are locally manufactured even though designs and part of the textile are imported from Europe.
The man who along with Mr Oliviero Toscani, the former advertising head of the brand, scripted some of the most controversial image-led advertising that tackled issues as varied as racism, child labour, AIDS and death sentence row, is not bogged down by the criticism that Benetton has bordered on nihilism and unscrupulousness in its campaigns.
"Communication requires creativity, it always requires a new way of expressing itself. If you want applause from everyone, then you have to create something very basic or banal. If you create something that is liked by everyone, then in my opinion it is liking throwing and not creating any impact," Mr Benetton said.
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