Guess? off to a flying start in India

Success never goes out of style. That's what Giulino Sartori, vice president, international retail, Guess? will tell you. The sophisticated, soft-spoken Italian, in Mumbai to flag off the formal launch of the Guess? brand in India, is excited about the business opportunities here.

"India is the 68th country in the world that we've entered. What's surprised me is the pre-existing awareness of the brand here. We haven't had to advertise or educate the Indian consumer about the brand."

Guess? Inc, with a current value of $2.5 billion, began as a blue jeans company in California in 1981, founded by Paul Marciano. Today, the brand includes clothing and accessories for men, women and children, as well as home collections.

Present in 68 countries, the company has 184 retail stores in the US alone, 213 international franchises around the world, and 1,135 shop-within-shops around the world. There's also a virtual cyber-store at guess.com.

The cryptic name of the company came from a McDonald's billboard which Paul Marciano used to drive by every day in the late seventies. The billboard read "Guess? . . . what's in a Big Mac?" Marciano apparently loved the billboard so
much that he named his company Guess?.

"India has been on our radar for some time now," Sartori says. "It's the hottest of the emerging markets, there is definitely an increasing upper-middle class and a willingness to spend. We discovered through informal surveys that Guess? brand awareness was already very high."

Industry analysts peg the current market in India for premium fashion at Rs 3,000 crore. The brand has tied up with lifestyle retail company Planet Sports, which began its international retail business in India in 2000 with licensing rights for a number of global brands such as Wilson, Puma and Speedo in the sports category, and Marks and Spencer and Women's Secret in the apparel category.

The one aspect of Guess? that the company believes distinguishes it from its three major competitors in the Indian market (Benetton, Tommy Hilfiger, Espry) is that the entire outfit is designed from an integrated perspective.

So one can go into a store and buy an outfit and complete accessories that were specifically designed for that outfit, unlike the others which sell disparate accessories. Prices are Rs 2,000 and upwards for ladies T-shirts, Rs 2,000-3,500 for men's T-shirts, Rs 3,000 upwards for denim jeans, and bags at Rs 2,500-plus.

Arun Bharadwaj, vice president, Planet Sports, says the target audience for the brand is those "in the age group of 18-35 in the A to A+

income category. We are targetting a clientele with an exposure to international high-fashion."

According to Sukanya Roy, brand manager, Planet Sports, "Guess?'s India prices are globally competitive and on par with US retail prices. We already have an efficient supply chain in place for dealing with imported products, so it is easy to pass on the benefits to the customer.

The stock we get is from the current season, not from the past season. In the three months we've been open, we've already had three changes of merchandise." However, one of the differences between US stores and Indian stores is the absence of fur coats and large sizes. "We don't think the weather in India is particularly conducive to fur, nor are Indians
large-built."

Already, says Bharadwaj, repeat customers are becoming the norm. Sartori says, "This is amazing since we had no advertising campaign. And the best part is that those who were going abroad to buy Guess? are now shopping in our stores in India." Formal print campaigns will begin next month.

The company, which currently has seven stores in place since its launch in May in Mumbai, New Delhi, Gurgaon, Hyderabad and Bangalore, now plans to open an eighth store in Chennai by the end of this year.

In the next five years, says Bharadwaj, "We are aiming for 40 stores with a turnover of Rs 100 crore by 2009." The company also plans to launch a footwear line by fall-winter 2005 and a costume jewellery line by
spring-summer 2006 in India.

"Currently, 75 per cent of our sales come from apparel and 25 per cent from accessories," says Sartori. "We want to shift the balance so that 35 per cent of our sales come from accessories and jewellery."

The company will also launch separate accessory stores and is also looking at children's wear brand "Guess? kids", which is a separate entity in itself. "Traditionally," says Sartori, "we've been a denim-driven brand. Now we're looking to shift our image to a 'global lifestyle brand'."

Because Planet Sports is experienced in handling issues of import duties, tarriffs and FDI restrictions, Arun Bharadwaj isn't fretting over them, but Sartori has concerns that are more fashion related.

"The Guess? woman is glamorous, flirty and sexy," he says. "The Indian woman is still extremely conservative. So, even if she has the buying power and an awareness of the brand name, it may still take a little time to woo her over to the Guess? clothing."

Guess they'll just have to wait.