Bugatti Shoes: Fits Like a Glove
It’s clear that Sirish Kumar, CEO India and Global Sourcing Director is leading Astormueller Shoes Private Limited into an advantageous future. After testing waters in the Indian market in 2017, the footwear company has successfully established its retail presence for Bugatti in 2018 with a stronger footprint across India.
With its origin in Schwelm, Germany, where Johan Müller first established the Johan Müller Workshop for bespoke shoes in 1928, Astormueller’s heritage in crafting fine footwear is of more than 80 years and is currently spread across over 35 countries.
India’s group head has vigorous experience in the footwear business and has a keen sense of the development of the Indian market. Sirish Kumar himself maintains that making Astormueller’s Indian arm successful was made possible by building on the company’s strong history in India. After the 2017 introduction, Astormueller soon realised that for Bugatti to succeed it would need to open its own stores. Always in pursuit of finding the perfect balance between good quality, good design and great prices, the brand prides itself on being optimistic, clear, accessible, reliable and typically German, promising straight-up service with a smile.
All products are designed in Europe and are developed in-house, with sustainable principles in mind, which is why they’re found on most feet across Europe. In addition to its bricks-and-mortar stores, Bugatti’s online presence is also growing, reaching a widespread consumer base. Responsible for the brand’s sourcing and retail in India, Sirish believes the expansion of its digital and social platform is crucial to enhancing customer engagement and gaining deeper insight into customers’ changing preferences. In a recent strategic development, the company has tied up with Iconic Fashion, a Gurugram headquartered company which was founded in Jaipur. In a short span of five years Iconic has become synonymous with premium multi-brand fashion retail. Iconic stores offer over 80 brands with products ranging from apparel and footwear, to fragrances, sunglasses, watches, leather products and accessories. Iconic is known for its massive stores, premium locations, a plethora of trends and collections, lavish interiors, welcoming yet unobtrusive service and a long list of happy customers.
Kumar shares his vision with S&A’S Amit Chopra in an interview.
How has been the retail experience for Bugatti so far?
We started online and now with the Iconic tieup we are happy to announce the launch of exclusive shop in shop experience zones, starting with Iconic’s own stores. We have been patient and are aware of how the Indian premium shoe market is poised.
Which segment and categories of footwear have been consistently performing well? What are the reasons attributed to their success?
We design and produce a whole slew of categories, for both men and women. In the women’s collection the casual shoes are very trednsetting and are being accepted rapidly, while in the men’s our semi-formal shoes are cutting through in a space which we have clear uniqueness. This has to do with how current and progressive our styles are, since the core strength of Astormueller has always been design and development, while riding the crest of the wave of trendsetting design. This, along with the quality of the fit our shoes offer, and the affordable price points, are the key factors and we see this remaining the core promise of the brand.
What did the brand bring to the Indian market that was different from other brands?
The Bugatti culture is very special - it is all about details, excellence and exceptional quality. Apart from the trendsetting style, we launch our collections both in Europe and India at the same time. The same shoes, with some differences, due to climatic variations, in the overall collection.
How receptive have been the consumers?
We’ve been well accepted we believe, although our reach and first collection has been limited. For example, we have one customer who bought 5 pairs of shoes for himself in successive months. We are happiest when customers talk about how well the shoe fits. We will closely watch the progress through our store presence over the next 6 months, leading up the next season.
Was the pricing strategy right or would you be rejigging the same?
The pricing strategy remains the same. The core price point rests at Rs 5-6,000 for men’s and a shade lower for women’s, while the collection has styles that are lower and as high as Rs 9,000 as well.
What would be the rationale behind business expansion through distribution/ franchising/online?
The market is ever growing and we at Astormueller are keen to reach out faster than usual. Time flies and while the market opportunity remains, the market structure does not offer the same advantages that we see in Europe, where it is largely driven by large chains. With a single national distribution partner such as Iconic we are ensuring that the business establishes a robust network across geographies faster, and controls the price parity between ecommerce and physical retail.
Bugatti’s presence has been very restricted so far, didn’t you under exploit the potential of your brand’s presence in the retail market?
The last two years, we have had some difficulties in shifting gears, and now we are full steam ahead. In a matter of just next two months we will have a steady retail presence in most northern markets, and region by region growth will follow.
What would be the retail marketing strategy in the coming years? What markets are you looking to tap on?
Shop-in-shops in departmental stores and multibrand shoe stores, ecommerce with the marketplace model, and a few select exclusive brand stores are already in the plan and much of it is underway. We are not planning to restrict the brand geographically, but we are catering to the young and middle aged alike, given our range. Our collection is very holistic, there’s a shoe for any occasion with the exception of pure sports, and the price points amplify the appeal of truly global brand name.
What global learnings would be brought to the India retail chapter post the launch?
Bugatti has already been introduced in India, albeit quietly, through the ecommerce fashion stores. The European markets are very different from India,mainly due to the immense differences in retail structure, the weather patterns and the fashion-sense of consumers. A lot of what we’ve learned has already become part of our operational systems, and we expect to hold our above average price points to good effect, just as we did in Europe early on. Today we remain one of the largest shoe brands in the midpremium price band.
What would be your online strategy?
Ecommerce via the marketplace model, since we do not believe in the discounting. Iconic will also be managing this effort.
The Bugatti culture is very special - it is all about details, excellence and exceptional quality.” – Sirish Kumar
Iconic, through its various stores across the Indian map, aims to deliver a lavish and memorable shopping experience no less than that of shopping abroad, by providing a whopping number of international brands, excellent retail locations, world- class ambiance and top- ofthe- line service, all under one Iconic roof. It believes in offering each of its customers a unique shopping experience molded according to their personal style and choice which is why the stores boast over 80 international brands from across apparel, footwear, fragrances, sunglasses, watches, leather products and accessories. Pawan Khandelwal, Managing Director of Iconic Fashion shares his views on retailing Bugatti.
How you ended up in distribution of Bugatti?
Iconic always has been known for being a one-stop destination for high-end premium brands for apparel, watches,
Iconic always has been known for being a onestop destination for highend premium brands for apparel, watches, sunglasses and perfumes.” – Pawan Khandelwal
sunglasses and perfumes. Soon enough, customers started expecting premium footwear and when we looked for brands that fit the ideology of Iconic, we couldn’t find anything better than Bugatti. It is premium, it is sophisticated and stylish.
Why did you choose Bugatti?
Bugatti is one of the leading premium footwear brands in Europe. Bugatti offers both hand-crafted products as well as products made using latest advanced technologies, so customers can have the best of both worlds. One of the most important factors to launch Bugatti at Iconic was our trend analysis reports that showed our customers lean favorably towards European brands which are more style-driven compared to American brands which are more logodriven.
Who is your target audience?
Well-traveled customers who are willing to spend on premium products and aspires for uniqueness.
What kind of growth do you foresee for the brand Bugatti –
In 6 years. planning to build a business of ` 100 crs ▶ ▶ And in 10 years. planning to build a business of ` 230 crs
Who are your biggest competitors?
We don’t see any direct competitor for our brand Iconic. Because we are the only brand offering over 80 “premium” brands all under one roof in the country.
In terms of trading density efficiency,
we can consider Lifestyle as our indirect competitor between MBOS, and Zara among single brand retailers. When it comes to footwear, we consider Aldo, Steve Madden and Charles & Keith as our competitors.
What are the major problems that you think shoe brands are suffering from?
For the shoe brands in India, the market is much more competitive now as compared to earlier days. With the launch of numerous international and even local brands, the challenges for shoe brands have risen. The only way out is to keep evolving and experimenting for giving the best to the patrons.
How has the entry of international brands affected the market?
Entry of international brands intensified the market dynamics and pushing Indian brands to improve the product offerings, service and quality. Also, international brands have helped getting in more customers.
Suggestion that will help footwear brands to do business better.
Looking at the increased competitive intensity going forward and impatient fashion conscious patrons, brands must create an efficient supply chain system because as fast as new trends emerge old one dies.
How do you manage inventory / business during slow down?
It’s a combination of few things – align your future buying, better forecasting and effectively using liquidation channels like outlets and online channels as a shortterm measure.
How do you deal with unsold stock?
Sell them through liquidation channels like end of season sale in own outlets and online channels
One business mantra you follow?
Keep offering best products in an equally best ambience with top of the line services.