TAG Heuer In India - by SPJIMR's Fin Whiz Ronak

Another perturbing point is that TAG Heuer is reducing its focus on India, at a time when it is deploying more investments overseas. China too has been a dampener for TAG Heuer, as of late, with the crackdown on gifting and corruption hitting luxury goods’ sales in the country. Westward, however, the situation isn’t nearly as bleak. With increased production numbers to cater to the rising demand, especially in the USA, TAG Heuer recently signed Chris ‘Thor’ Hemsworth as its newest brand ambassador. Additionally, TAG Heuer is making an aggressive foray into the smartwatch space, in an alliance with Google and Intel, and it recently signed a major sponsorship deal with Infiniti Red Bull Racing, thus increasing its focus on FormulaOne, which has always been a major promotional platform for the brand.

With a bevy of brand ambassadors in India such as SRK, Piggy Chops and RK (the man himself and not the initials tattooed on the nape of Ms. Padukone’s neck), along with a presence in nearly every major Indian city, in the form of an EBO or an authorised dealer, there’s not much more that TAG Heuer could have done except perhaps wait it out longer for breakeven. It does go on to highlight the fact that luxury brands have to make huge investments via the direct subsidiary route and then wait for a number of years before those investments finally begin to pay off. Besides, India’s high and complicated tax structure with its suffocating duties would have been another black mark. Furthermore, with TAG Heuer looking to match its pricing in India with its global standard, the Rupee depreciation has resulted in costlier imports and didn’t exactly work in its favour, especially via the direct subsidiary model. As far as TAG Heuer goes, both its time and its patience seem to have run out.

While the direct subsidiary model gives a brand control over its distribution, sales, marketing and after – sales servicing, the hands – off distributor model may not be the best way forward for TAG Heuer and it remains to be seen if the brand can indeed get its sales growth ticking again. Incidentally, TAG Heuer’s marketing campaign, with a series of ads featuring its brand ambassadors, just so happens to go by the tagline ‘Don’t Crack Under Pressure’. Ironically, as far as its Indian sojourn goes, TAG Heuer seems to have done just that.

Ronak Ravindran is a PGDM 2014-16 student at SPJIMR, Mumbai specialising in Finance. Connect with him on https://in.linkedin.com/in/ronakravindran. You can also follow his blog,http://corporateprophet.blogspot.in/

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