Sunil Kataria on Raymond’s significant ad spend hike for festive season this year

Way back in 1945, a small woolen mill was set up in Thane. That was Raymond’s Woolen Mill, which later evolved into India’s first homegrown ready-to-wear brand. The brand has seen many milestones throughout its iconic and transformational journey – expanding into FMCG, scaling its lifestyle business, demerging its real estate business, and consolidating its engineering business.

“Raymond, a hundred-year-young brand, has remained relevant across generations. Making it to the top ten iconic brands in the Brand Finance India list this year is a testament to our brand's strength and what it means to Indian consumers,” Sunil Kataria, CEO, Raymond, said at a recent press conference held in Mumbai yesterday (September 3, 2024).

Raymond Lifestyle Ltd (RLL) is gearing up for a landmark moment as it prepares to list its shares on the bourses on September 5, 2024. The company is set to embark on the largest retail expansion in its history, with plans to add 900 new outlets over the next three years. As part of the Raymond Group, RLL aims to achieve a 15% Compounded Annual Growth Rate (CAGR) and secure approximately 7% of the rapidly expanding men’s wear wedding market by 2027.

Following the demerger of its retail and lifestyle businesses, Raymond will now operate as two listed entities, with a strategic focus on unlocking shareholder value through specialized business segments. Leveraging a legacy spanning nearly a century, Raymond holds a dominant position as the largest brand in the Indian men’s wear wedding market, valued at around Rs 75,000 crore. RLL is set to emerge as one of the top three global fabric suppliers by the end of this year.

“We have created a highly professional board, with 80% of its members being completely independent directors. This reflects our commitment to high corporate governance standards, which is rare in most companies across the country,” Kataria mentioned.

Speaking at the press meet, Gautam Singhania, Chairman and Managing Director, The Raymond Group, emphasized on the uniqueness of Raymond’s offerings, saying, “This is the only company in the world that goes 3,000 times in price – from Rs 300 a meter to Rs 10 lakh a meter under the same brand.”

With sales from the wedding business reaching Rs 2,550 crore in FY’24, including offerings like Raymond’s wedding and ceremonial attire and Ethnix, its Indian ethnic wear line, RLL is well-positioned to continue its legacy of excellence in the men’s fashion industry.

Adgully caught up with Sunil Kataria, CEO, Raymond, to know more about the company’s ambitious growth plans and its vision for the future.

Could you elaborate on Raymond’s expansion plans?

We plan to add between 800 and 900 new stores. Currently, we have 1,050 TRS stores, in addition to around 400 EBOs, which include franchised Raymond shops. These 400 outlets are spread across four brands: Raymond Ready to Wear, ColorPlus, Park Avenue, and Ethnix. Ethnix alone accounts for one or two of these stores. The EBOs consist of 75% franchise-owned stores, with the remaining 20-24% being company-owned marquee stores.

In total, we aim to have around 1,500 stores combining TRS and Ethnix stores. For the EBOs, we’re looking to add about 800 to 900 more stores, all of which will be franchise-owned. We typically maintain a 75:25 franchise-to-company ratio, although Ethnix initially has a ratio closer to 30:70.

Could you give us an overview of the men’s wear wedding market in India?

The wedding-related men’s wear market in India is huge, around Rs 75,000 crore, with 91% of it being unbranded. We hold a 5% market share, which is significant given the market size. We’re the dominant player, almost two and a half times the size of the next competitor. We’re looking to strengthen this position by increasing our share through premiumization, expanding our ceremonial ready-to-wear segment, and launching more ethnic wear.

Are there any partnerships with major retailers for the home category?

Yes, we have significant tie-ups with Reliance, and we distribute through our own direct retail channels, which include multi-brand outlets and general trade channels.

You had mentioned international markets as a new vector. Could you elaborate on that?

Apart from our focus on innerwear, ethnics, and sleepwear in the domestic market, we’re exploring opportunities in the international market, particularly with Raymond stores. We’ve identified the UAE within the GCC as a key area for growth, especially given the large Indian diaspora. Another market that we’re studying is Saudi Arabia. Though it’s still early days, we’re optimistic about its potential due to the country’s rapid economic growth and market openness.

How many stores are you planning to open in the Middle East?

We’re still in the early stages of evaluating the Saudi market, so it's hard to provide exact numbers. However, we hope to have a clearer plan in the next few months. Our goal is to move fast, ideally within six months.

What about your current international presence?

We already have around 50 stores internationally, including in Bangladesh, the Middle East, and Nepal. We’re looking to expand further, particularly in the GCC, with a focus on Saudi Arabia and the UAE.

Will the ‘Complete Man’ tagline be making a return?

The ‘Complete Man’ tagline has never gone away. It’s a strong emotional anchor for the brand. We’re currently working on a new campaign centered around this concept, which we plan to roll out during Diwali.

How has the first half of the year been, and what are your plans for the second half, especially with the festive season approaching?

The first half of the year has been relatively quiet with fewer weddings, but we’re gearing up for a strong second half. Our ad spends will increase significantly, with large campaigns planned around Onam for our ethnic wear segment and the ‘Complete Man’ campaign. These campaigns will be a mix of TV, digital, and print.

What are your focus markets?

Our focus is on metro, Tier 1, and Tier 2 cities, where our brands are currently underserved. These markets contribute the bulk of our apparel business, so we’re prioritizing expansion there over the next three years.

Have you noticed any shifts in consumer behaviour, and how are you adapting to them?

There has been a clear shift from unbranded to branded products, particularly in fashion. Consumers are more aware of global and national brands, driven by social media. The challenge now is to serve consumers across multiple channels, as they often browse online and purchase in-store, or vice versa.

What are your marketing plans for Park Avenue, particularly targeting younger audiences?

For Park Avenue, we’re focusing on new-age fabrics and apparel, like our Flex Tech fabric, which offers stretch and comfort. Last year, we ran a campaign called ‘Fearless Whites’.

Also Read: Raymond Lifestyle eyes on 7% share in men’s-wear wedding market by 2027