Brands like Puma, Fiat tap into lifestyle services to gain foothold in India

Written by Ajay Sukumaran | Debojyoti Ghosh | Debojyoti Ghosh | Bangalore | Updated: Jan 2 2014, 18:05pm hrs
Brands cafeItalian car manufacturer Fiat had launched the country's third Fiat Caffe in Bangalore.
Six months after opening the countrys first Puma Social Club in Bangalore, the global sports lifestyle major is now looking to take the lounge format to other cities, giving strength to a niche trend of brands tapping into lifestyle services for a young clientele with expandable wallets. The concept, which is tried and tested in mature markets is slowly finding its feet in India.

Puma, along with Italian car manufacturer Fiat, which launched the countrys third Fiat Caffe in Bangalore this year, is among the companies that have recently ventured into these social extensions.

A leading apparel house is also understood to be exploring the option of a cafe within a large format store in Bangalore.

According to experts, this trend would likely cascade as more brands seek out services to connect with their points-of-sale.

We want to take the Social Club to other cities, but it has to be attached with a store. Once we find a 5,000-6,000 square feet location, around 3,000 sq ft of that could be the club, Puma India managing director Rajiv Mehta told FE. The idea behind Social Club was that it should be attached with a store and should not be in a separate location and completely disconnected with the brand. We want to sell the lifestyle experience.

Mehta reckons a lounge, bar or a restaurant is a perfect fit to his brand and the company is exploring cities such as Delhi, Mumbai, Chandigarh, Ahmedabad and Pune. We need a partner who can run it for us and we will provide branding elements. We invest only in the rental of the place, added Mehta.

The Fiat Caffes Italian restaurant and the cafe format in Bangalore, meanwhile, is gearing up for operations from January, having set up a full-fledged kitchen this month. Fiat, being an Italian brand, already had a lifestyle aspect attached to the brand, said Adit Morzaria, whose KHT Fiat dealership runs the Fiat Caffe in the city thats part of a car showroom.

The Italian car maker, which has a total of three Fiat Caffes, including those at Delhi and Pune, does not plan to establish any more Caffes in India, given that there are only a dozen or so Caffes globally and often just one per country. A spokesman for the carmaker said that the Caffes in India regularly host events and that the initiative has helped its brand building efforts.

Brands can no longer remain products.They need to jump out and become services, said Harish Bijoor, a Bangalore-based brand expert, citing the example of cosmetics brand Lakme which ventured into beauty-related services including salons early on.

Other examples include the Buddy Lee Caf started by American denim maker Lee in Ahmedabad but which was closed three years ago. Experts point out that for brands to run such formats it is important to get the right business model as logistics could be a challenge.

Bijoor added that the trend of giving soft strokes to hard brands would gain momentum as several companies are only testing the waters currently. China and India seem to very ripe for these kinds of moves. Literally any product has a service avatar.

Puma, whose club in Bangalore earns revenue of about Rs 32-33 lakh per month with an average billing price of about R1400, sees India as a key market for its lifestyle category products. It is one of the bigger market in terms of number of pieces sold in the lifestyle category including apparel and footwear. Globally it is a significant number when it comes to number of pieces sold in the lifestyle segment, said Mehta of Puma.