Overcoming colonial mind-set

We know the market!
We know our customers!
We know our competitors!

As brand consultants we keep hearing this from many brand owners. But one thing which I always impress on my clients is that markets, consumers, competitors are in an unswerving cycle of evolution. If we don’t amend and adapt to the perpetually evolving environment then sustaining the business would be a challenge. Latest stories of downfall of Kodak the market leader imparts the prerequisite fact to overcome from the colonial business mind-set.  I’m sharing a classic example of a brand that had put their strategies in place at the right time. ‘Bata Shoes’ one of the brand with which we all are connected since childhood.

Bata Shoes has strong history and legacy attached with two of the main historical events i.e. WWI & WWII. Company was incorporated in the year 1894 in Zlin (Austro Hungarian Empire then, today the Czech Republic) by Mr. Tomas Bat’a. The company started experiencing rapid growth during WWI due to rising demand for the army/military shoes.
Company expanded its operations under the leadership of Mr. Thomas Bat’a and after his sudden demise due to plane crash, under the leadership of Jan Bat’a (half-brother of Mr. Thomas Bat’a). Bata Shoes started their operations in India in the year 1931 by establishing ‘BataNagar’

In India we all grew up with Bata brand and was the only brand known to us in the male footwear segment. The only brand gratifying the expectations of true Indian mindset was Bata. It still confuses me that why the brand didn’t leverage its equity in the female footwear category then, the brand was masculine targeting only male, the designs and product performance was robust. I still remember, my Dad always recommended Bata Shoes for me (May be, in the long run it will be lighter on the pocket

With the 1991 economic liberalization and the entry of International Brands / perceived international brands (although Indian but the communications build the image as International brand) Indian consumers’ (including myself) got exposed to multiple brands with trendy designs and it started overtaking the rational of Bata i.e. product performance.   I’m not sure about the business performance of Bata since 1995 onwards, but as a consumer I never wanted to buy the brand which is perceived to be meant for middle class and also the designs never built iota of aspiration within me. So, I opted out from this brand for almost 11 years (from 1999 until 2010)

In March 2011 my dad noticed an advertisement ‘Bata discount sale, up to 50% off’, he insisted me to visit nearby Bata Store with him. More than a surprise; it was a positive shock for me. I never thought it was the same old Bata brand I use to wear it in school. I never imagined such aspirational and trendy designs from Bata, multiple choices for every occasion i.e. formal, casual, and party, sports and sports. As a brand custodian and consultant it intrigued me to visit few more stores and interact with captive customers and sales personnel inside the store.

Basis that I’m sharing a few insights (from brand point-of-view) that ‘How Bata has overcome the colonial business mindset ’

1)    Strategic Shift: Lot of brands disappeared in last 20 years or is on the verge of disappearing due to entry of International Brands. You must be remembering Topaz, Onida, Televista, lambretta scooter etc. Nevertheless Bata relooked its strategy i.e. overcoming from the mindset of being a manufacturer to retailer of brands. This is one of the conscious and apt decisions made by Bata senior management team. 

2)    Focused approach: The Company established its focus on high-margin premium brands such as Hush Puppies, North Star and Weinbrenner and outsourced the production of its low-cost merchandise to keep the operational cost in control.

3)    Brand Visibility: In 2010, it opened 108 stores, taking the total count to 1,300 in India. Planning to open 50 -60 stores in Tier-II & Tier-III towns coupled with consistent advertising and communications. This has created huge visibility for the brand in the targeted markets.

4)    Brand repositioning: The brand has repositioned itself to target younger audience through Northstar, Hush-Puppies and Weinbrenner. It has also brought ‘Bipolarity’ to the brand by establishing equal focus to Women category through exclusive brand Marie Claire

5)    Aspirational Communication: The communication is very much sophisticated targeting the affluent class. It is more subtle and sensitive towards the Indian Gen-Y

6)    Optimization of retail stores: Optimized the retail chain by opening large-format stores, closing down the less profitable ones and renovating the rest. Brought focusing on high-footfall locations for better conversion and margins.

7)    Multiple choice of brands: Introduced premium brands from global portfolio like Hush Puppies, North Star,  Weinbrenner and Marie Claire

8)    Brand Line extension: Brought in accessories for both Men and Women i.e. Belts and Hand bags as a natural brand extension to increase token size and per SqFt margins. This also gives better choice to the shoppers

9)    Experiential service: Along with in-store service Bata has also launched new complementary services such as online shopping and Bata Home Delivery service.

The business has started showing healthy signs of recovery both from operational margins and net margins POV

The brand has been able to enhance its enterprise value from shareholder point of view with upward moving share price. From the entire stakeholder point-of-view, Bata brand has able to create the pull for the brand, all because it has “Overcome from Colonial Mindset”