Samsonite pushes aggressive twin-brand strategy

Mona Mehta in Mumbai

Luggage major, the Rs 53-crore Samsonite India, has embarked on a twin brand strategy for its soft and hard luggage categories, with an aim to expand the presence of its recently introduced mass market brand ‘American Tourister’, while at the same time, selectively focus on the premium brand ‘Samsonite’.

Samsonite India is a 60:40 joint venture partner between Samsonite Corporation and the Tainwala group.

As part of the strategy, the Samsonite range of travel-ware will cater to the super premium end of the market, while American Tourister will be targeted at the middle-to-premium end. American Tourister has been made available at all the 900 dealers across major cities, in addition to the company’s exclusive showrooms, while Samsonite’s presence will be restricted to 450 dealers alongwith the exclusive showrooms called Travel World. At present, Samsonite is available at all the 900 dealers.

Reasons Samsonite India director (sales and marketing) Mr EP Suresh Menon: “The move is aimed at combating competition by enabling the dealers to showcase and classify both the brands pertaining to the two segments. The company is instead restructuring its Samsonite product line to professional dealers in order to create a niche for the brand.”

While the Samsonite range is priced between Rs 4,700 and Rs 6,300, American Tourister is available between Rs 1,250 and Rs 3,700.

By reducing the number of dealers for marketing the Samsonite range, the company will save two per cent on the service costs and manpower, adds Mr Menon.

Informs Samsonite India assistant general manager Mr Sandeep Goenka: “The company imports 90 per cent of the 30,000 units of soft luggage from Far East and Europe through 30 vendors spread globally.”

In the overall Rs 600-crore luggage market in India — where VIP is the leader — Samsonite’s share stands at about 20 per cent. The domestic industry is witnessing a shift in consumption of soft luggage vis-a-vis hard luggage. Against the consumption ratio of 15:85 for soft luggage and hard luggage, the emphasis is on soft luggage which is slowly picking up. The market for hard luggage, which was growing at 10 per cent growth rate last year, is currently stagnant. Soft luggage is growing at a rate of 15 per cent this year. The soft luggage market is estimated to grow at 25 per cent by the end of calender year 2002.

In order to cater to the consumer need for buying soft luggage instead of hard luggage, Samsonite India is working out a new strategy. The company is launching a new sub-brand ‘F’Lite’ in hard luggage, albeit with soft luggage features. These features include a polypropylene embedded hard-luggage upright with light weight.

F’Lite is an upright series in the hard luggage segment. An upright series usually comes in the soft luggage segment, and is available under the sub-brands Spark, Accent, Airstop and Rhapsody. This range is priced between Rs 3,820 and Rs 6,250. F’Lite, which will be launched in October this year, will be available from Rs 3,000 onwards.

Says Mr Goenka: “F’Lite is targeted at the premium end of the market with best possible features of soft luggage.” Samsonite’s existing upright series contributes 60 per cent to the Rs 35 crore sales generated from the soft luggage segment.