Where legacy meets tradition: Raymond Ethnic Wear

Introduction:
Raymond, since 1925, is the leader in branded clothing for men in India. It has an OTC fabrics business
that offers a spectrum of products across such a wide price range, catering to the needs of consumers
across age groups and socio-economic profiles, that it is needless to say that Raymond is the No 1 textile
brand in the country. It is one of the few companies in the world, fully integrated to manufacture the
finest quality of wool and wool blended fabrics.
The brand enjoys high level of trust in the mind of the consumers and is strongly recognized as one that
makes high quality products- a position of strength that it has attained overs years of consistent efforts
in product development, advertising and retail development. It must be mentioned that, in OTC fabric
category, there is no other fabric brand that enjoys strong consumer pull at the point of sale that is
comparable to Raymond. Firmly established as the leader in the fabric business, the brand has made its
entry into the readymade space- this of course, is in line with market trends in India today which is in
favor of readymade apparel.
It was the beginning of 2013 and the last couple of years have been witnessing intensified competition
in the marketplace. Input costs have been going up- be it the import of the finest Australian Merino
Wool or the high manufacturing costs. It was only due to the strength of the brand that Raymond was
still able to command a premium in terms of price over the other players in the market and stay number
one player in menswear. As the Marketing Director of Raymond pondered over the future, he couldnt
get past a few thoughts which had been playing in his mind for the past few weeks. Would it suffice for
Raymond in just being a leader in worsted suiting fabrics? Was it relying too much on its strengths and
forgetting that the domestic apparel and textile landscape was changing at a break neck speed with the
influx of foreign players?
With the brand deriving a large share of its consumer equity through textile business, as against
readymade apparel- it had always enjoyed preference in usage occasions that lend well to planned
purchases. With the booming mall and plastic money culture, is Raymond adequately geared up to tap
in on the changing shopping trends in India? Raymond enjoys a very strong connect as a wedding and
celebration brand- should he not be building on that-does this not augur well for an ethnic wear line
from the brand?
In the last season, Raymond has already done a pilot marketing for ethnic wear in a few select territories
by putting a small collection in the market just to test out the acceptability of products. Results prima
facie from this pilot initiative seem to be positive.
The Brand Manager has done some ground work in terms of analyzing the market scenario in the ethnic
wear space. He conducted a market survey, the results of which are available now with the teamthough it was just a small dipstick and not an elaborate research, it still gave the team some food for
thought. The board is keen on making inroads into the ethnic wear category, and anecdotally this looks

like a strong possibility. However, the brand is very strongly associated with western wear, and will this
be a baggage? What about a new brand altogether- but Raymond has very high equity in special
occasions for men, where Sherwanis and Bandhgalas have become a significant part. With a strong
brand like Raymond, should he be even considering a new brand, given the investments required to
build scale for it.
The Marketing Director has to make a few vital decisions. He has a presentation to the board.
-Should Raymond enter ethnic wear category?
-What are going to be the key challenges?
-What should be the branding strategy?
-What should be the go- to-market approach?
- What kind of strategy he would adopt on product mix?

Company Background:
Today Raymond is one of the largest players in suiting and shirting fabrics, readymade, denim fabrics,
cosmetics & toiletries, engineering files & tools, prophylactics and air charter services in national and
international markets. The Raymond group is vertically and horizontally integrated to provide customers
total textile solutions with highly respected fabric and apparel brands under its umbrella: Raymond- in
both textile and apparel form, Park Avenue, ColorPlus, Parx, Makers.
The fabrics are exported to over 55 countries in the world; including European Union, USA, Canada,
Japan and Australia amongst others. A trendsetter and an innovator in the Indian textile market, their
expertise has been brought forth by the in-house research & development team. Their innovations have
become milestones in the worsted suiting industry.
They have mastered the craft of producing the finest suiting in the world using super fine wool count
(from 80s to 250s) and blending the same with superfine polyester and other specialty fibers, like
Cashmere, Angora, Alpaca, Pure wool and Linen.
Raymond has also created the worlds finest worsted suiting fabric from the finest wool ever produced
in the world the Super 250s fabric made of 11.4 micron wool.
Recognized as a pioneer in Wool and wool blended products, called Polywool in industry parlance,
Raymond has also got a good presence in the Poly Viscose category, which has many other competing
brands and operates normally at lower price points compared to Polywool products.

Raymond: A Vertically Integrated Conglomerate

State-of-the-art Manufacturing Facilities

Unparalleled Retail Presence

World-class facilities
Raymond's manufacturing facilities include world-class fully integrated plants in India, deploying stateof-the-art technology modern quality management systems like ISO 9001 and Environment Control
Systems (ISO 14001). All the plants are self-sufficient and provide staff welfare measures such as
education, housing, recreation and support systems for employees.
Raymond Suiting plants are located in India at the following locations:

Chhindwara in Central India

Vapi in Gujarat, near Mumbai
Jalgaon in Maharashtra.

The Raymond Chhindwara plant, set up in 1991, is a state-of-the-art integrated manufacturing facility
located 57 kms away from Nagpur in Central India. Built on 100 acres of land, the plant produces
premium pure wool, wool blended and polyester viscose suiting fabrics. This plant has the distinction of
being among the largest integrated worsted suiting unit in the world.
Modeled to meet international standards, the Vapi plant has been set up on 112 acres of lush green land
with Hi-tech machinery such as warping equipment from Switzerland, weaving machines from Belgium,
finishing machines, automatic drawing-in and other machines from Italy.
The Jalgaon plant also embodies all the values that go behind giving consumers the very best, when it
comes to suiting fabrics in India.
In addition, Raymond has a world-class shirting plant in Kolhapur that is a joint initiative with an Italian
partner.

Unparalleled Retail Presence

Raymond manages its retail presence primarily through its flagship chain called The Raymond Shop
(TRS). It has also introduced the Made-to-Measure store concept to provide unique premium service
based on personalized fits, primarily in the bigger cities. Raymond has an extensive distribution network,
comprising over 700 TRSs including 39 in the Middle East and the SAARC region- this extends right from
the metros to tier 4 towns- with this reach, you are never too far from a TRS. Raymonds clothing
business is present in around 20,000 Multi-Branded Outlets too, largely driven by the fabric business
wholesale channel.
The Raymond Shops offer complete wardrobe solutions to its customers with a fine range of fabric and
ready to wear collection from brands in the group roster. This includes well-known brands Raymond,
Park Avenue, Color Plus and Parx, which are available throughout the chain. These brands have their
own exclusive stores also, and are managed as different brands with business goals of their own.
Brand Strength:

Raymond is the leader in OTC fabrics with huge equity in Woollen products like no other brand. The
brand Raymond is all about showcasing The Saga of a Complete Man. At every point in the complete

mans life Raymond has had a special role to play. Be it professional like Graduation, Interviews, a big
day in office, or personal like a close relatives weeding or a party.
In a large number of Indian families, Raymond and The Raymond Shop are integral parts of the wedding
shopping and the gifting associated with it. For the groom also, it is a destination store when it comes to
the wedding suit. When it comes to a Sherwani, he has other options where he can shop from.
Raymond Textile and its other four businesses i.e. Raymond Readymade, Color Plus, Park Avenue,
and Parx, enjoy significant presence across the semi-premium and premium segment ranging from
formals to semi-formals and casuals. The company has positioned each of its brand in such way that it
will help in avoiding cannibalization.
According to the syndicated research on Raymonds equity, the brand is on top of the league with over
maximum spontaneous recall and top-of-the-mind recall survey. (Suit/Suiting -2013)
Raymonds Brand Equity scores are lower among branded readymade preferers as against fabric
preferers, though it still occupies a leadership position among them too.
Fabric Preferer

Score-Suits/Trousers

Raymond
TOMA
Spontaneous
Total Awareness
Last I year purchase
Currently in
wardrobe

48
84

Nearest
12
52

Readymade Preferer
Raymond
29
66

Nearest

Overall
Raymond

Nearest

15
43

37
73

11
33
92
40
51

77

49

58

51

100
66

86

59

67

64

74

Indias Textile & Apparel Market

The current domestic textile and apparel market is worth Rs 2,73,750 crores (USD 58 billion) and is
expected to grow at 9% annually to reach Rs 6,63,800 crores (USD 141 billion) by 2021.
The overall domestic textile and apparel market consists of the following broad categories:

Apparel
Home Textile
Technical Textile

2011

2016

2021

CAGR
2011-21

Apparel
USD 40 bn
INR Cr 1,90,300

Home Textile
USD 4 bn
INR Cr 18,400

Technical Textiles
USD 14 bn
INR Cr 64,650

Total
USD 58 bn
INR Cr 2,73,350

Apparel
USD 63 bn
INR Cr 2,94,000

Home Textile
USD 6 bn
INR Cr 27,350

Technical Textiles
USD 24 bn
INR Cr 1,13,200

Total
USD 93 bn
INR Cr 4,34,550

Apparel
USD 98 bn
INR Cr 4,62,250

Home Textile
USD 9 bn
INR Cr 40,800

Technical Textiles
USD 34 bn
INR Cr 1,60,750

Total
USD 141 bn
INR Cr 6,63,800

9%

8%

10%

9%

Menswear Market:

Indian Ethnic Wear Market

The traditional ethnic wear subcategory had started witnessing the entrance of a growing number of
organized players, a market which was mainly restricted to the unorganized sector till a few years ago.
Modern retail, especially large format retailers are ramping up their expansion plans across metros and
Tier I & Tier II cities. This will contribute significantly to the growth of the Indian ethnic wear market.
The womens segment currently accounts for an overwhelming 87% of the total ethnic wear market and
is expected to grow at 8% in the coming years. This, however, does not look like a possibility right now
for Raymond.

The ethnic kids wear segment is projected to grow at a CAGR of 10% for the next few years. Even within
kids wear, it is interesting to note that the girls ethnic wear market is two and a half times the size of
the boys ethnic market.
While the market for men is expected to grow at a CAGR of 8.5%, this will largely be within the high
value segment that is heavily guided by occasion-based purchases. The opportunities thrown up by the
wedding/bridal market in India are tremendous. Right from local boutiques to established traditional
retailers and regional brands, every wedding wear retailer is vying for a share of the loyal consumers
wallet in a market that is getting highly competitive.

Competitors:
Niche brands such as Manyavar, Diwan Saheb, and Vastra are few examples of players that have
managed to command a premium for their services. Among these Manyavar is the brand which can be
considered the leader in the branded space.
Manyavar is a 300+ Crore brand currently growing at 60% y-o-y. It has a cumulative retail presence of
2,00,000 sq. ft. i.e. EBOs, MBOs and LFS combined. The number of EBOs is around 200 spread across 80+
cities pan-India.
Owing to the religious and cultural diversity of India, a wide range of occasions are celebrated. Such
celebrations typically start early in the year in January, when Northern India celebrates Lohri, and
culminate around October-November with Dussehra and Diwali. On such festive occasions, consumers
tend to purchase ethnic wear for both personal use and for gifting, as brands typically bring out new
trends and designs to coincide with a festive occasion. These occasions typically drive the growth for
womens, kids, and mens ethnic wear.
Ethnic wear was initially a category that was largely restricted to the older age segment. However, it is
now finding acceptance even among younger consumers. This has led to brands focusing on ethnic
fusion wear product offerings, in western styles and prints, in order to capture the opportunity. With
interesting interplay of different fabric types, brands have completely redefined ethnic wear for younger
consumers.
Although traditional markets shall continue to be of importance, a consequence of the above factors is
the increasing salience of modern formats among consumers. Until modern retail opened its doors for
urban consumers, local tailors and neighborhood boutiques were satisfying the ethnic wear needs of
most consumers. Large format retailers were unheard of earlier. With the coming of modern retail,
consumers have easy access to branded products that straddle the tiered pricing segments

Challenges:
Ethnic wear, as a category, is quite specialized and complex to manage. There are various elements
involved in the making of something special. Todays customers are ready to pay for Hand Embroidered
garments, for instance. Exclusivity of design is also key- after all the groom has to stand out in the group!
There are many challenges in the category such as inventory management since it is a very seasonal
business.
Dead Stock:

Dead stock is a major issue in readymade ethnic wear since it becomes necessary to stock all sizes of at
least the popular designs of the season
The initial survey shows dead stock to be an average of 25% in stores which are doing well and can
range upto 40% in stores where sale is duller.
Minimum of 50 or more designs are usually preferred per category (Sherwani, Indo-western, Designer
blazer sets) for the customer to make a choice, at a point of time in the store.
Incentives are given to salesmen to push such old season pieces which havent moved. A special
occasion product cannot be sold on discount during a sale!

Dynamics:
A very crucial pocket of growth will be the demand from the small towns, which are the metro cities of
the future. A large number of brands are already eyeing this opportunity. The demand for ethnic wear is
large even within these cities and this demand frequently drives small town consumers to big cities for
their shopping requirements. The onset of the e-commerce revolution is also changing the game.
Consumers are able to purchase many, if not all, popular ethnic wear products from the comfort of their
homes.
With many physical brands setting up online stores and others selling through online portals, customers
who do not have access to physical stores can purchase the brands online. Though there are issues that
need to be ironed out before the online space emerges as one of the preferred shopping destination for
ethnic wear, many ethnic wear brands have started to think of their online presence as a viable sales
channel rather than just a website.
As different channels continue to emerge and evolve in the ethnic wear market, the growth of brands
will be largely dependent on their ability to differentiate themselves across product and service
offerings.

Conclusion:
The Marketing Director has a presentation with the board in a weeks time in which he would be laying
out the future course of the brand. Entry of Raymond into ethnic wear is, for sure, a subject of keen
interest-and anecdotally-it is clearly coming as an opportunity- but how to do it? Is the market lucrative?
How about possibility of extending the formal brand to ethnic wear? What kind of brand architecture
should he adapt- whats going to be the go-to-market strategy?

Annexures:
Annexure 1: Zone-wise sales pattern of mens ethnic wear product categories (Survey conducted by
Brand Manager among Raymond Customers)
North Zone
East Zone
West Zone
South Zone

Indo-Westerns
31%
18%
32%
25%

Sherwanis
29%
20%
27%
21%

Blazer Sets
9%
24%
22%
25%

Kurta Pyjama
31%
38%
19%
29%

Annexure 2: Readymade vs. Stitched preferences according to Occasions (Raymond Customers)

Occasion
Close relative/Friend's wedding
Birthday
Festive Occasions
Distant relatives/colleague's wedding
Anniversary
Inauguration ceremony

Readymade(%)

Stitched (%)

38%
49%
44%
45%
52%
50%

62%
51%
55%
55%
47%
50%

Annexure 3: Dressing habits according to occasions (Raymond Customers)

Close relative/Friend's
wedding
Outfit
%
Any other western
73
outfit (shirt, t-shirt,
suit etc)
Sherwani
40

Birthday

Festive Occasions

Outfit
%
Any other western outfit 73
(shirt, t-shirt, suit etc)

Outfit
Kurta-Pyjama

%
70

Others

41

28

Indo-western
Kurta-Pyjama
Blazer set (with
embroidery)
Others

24
15
11

Kurta-Pyjama
Kurta on jeans
Indo-western

21
19
5

Any other western outfit

(shirt, t-shirt, suit, etc)
Sherwani
Others
Kurta on jeans

10

Jodhpuri / Bandhgala

Kurta on Jeans
Jodhpuri/Bandgala

8
7

Blazer set (with

embroidery)
Others

Mens ethnic wear

Kurtas
Pyjamas
Nehru Jacket
Indo western clothing kurta-shirt hybrid with stylized pyjama type thingy

Core competencies

Structural Capital
o R&D: World leader in fabric manufacturing. Specifically Wool
o Processes
o Philosphoy + systems: Scale operations

20
14
7

Relational Capital
o Channel: Massive retail presence in two channels: Exclusive outlets, multi-brand retail
o Brand: High brand recall. Association with classy Formal wear
Human Capital:
o Skills focused around manufacturing efficiencies
o Strong fabric developing skills

Customer Segments
Target
Decision maker: Male
Decision influencer: Mother/sister/partner
Segmentation based on affordability: SEC A
Age: 20-35 marriageable age for sherwanis. Friends/relatives get married. Disposable income
Rationale for the target:

Accessible: Parent brand target customers

Substantial: Target market size
Diff: Brand awareness, aspirations
Disposable income
Programs: Product range fit

Position
Celebratory Brand| Celebrate occasions| complete man interacts with family, friends colleagues in a
variety of
Close to roots and culture
Integral part of family
Has arrived in life
Effortlessly imbibes the spirit of the occasion

Wedding : Most important man on the day

Indo western: Indicates mold of mind - a perfect blend of western and Indian cultures

4Ps
Products

Sherwais Celebrate Weddings

Indo Western Wear Friend/Relative Weddings, Ethnic Occasion with colleagues

Kurta Festive wear

Bahrain123

Place

Exclusive Retail Outlets Separate from the Raymond Store. Store ambience will be celebratory
as contrasted with suave look of The Raymond Shop.
Multi-brand retail Sell only kurtas since this is the only volume product
Direct Selling Send salesperson to client residency for garment consulting during weddings
Network effect since owing to presence of large number of relatives present in a
bridegrooms home
Can create pull for other products due to emotional connect established
E-commerce: Focus on product variety.

Price

Competitive Price Range keeping in mind purchasing power of target customer segment

Promotions

Store look to be revamped for each clothing design cycle based on tastes of each festive seasons
Brand Choice
o Brand Name Parampara by Raymond
o
o

Separate brand under the umbrella of Raymond

Will be able to cash in on Raymonds massive brand equity which has high recall while
creating a separate identity for the new brand
Brand Awareness
o Message to be conveyed:
Brand building
o

Brand awareness building:

Curiosity Generation & Concept Elucidation POS print ads, TV ads focusing on celebrations &
Raymond brand

Follow-up :

Time: <12 mins - Original Ideas - Content Presentation Skill