Forbes India – Fashion, Sportswear: Underdog, Animal Instinct And Top Dog: Puma’s Giant Leap Into The Rs 2,000-crore Club
The intention was to forewarn. ‘The shoe will pinch’ is how Abhishek Ganguly’s colleagues and friends reacted when they obtained to know that the regional supervisor is quitting Reebok. Right after a a few-calendar year stint, Ganguly was set to be a part of rival Puma as director of gross sales and promoting in November 2005. The problem was valid. Puma, which was the past among the the massive world wide sportswear makers to enter India in 2005, closed the first yr with a puny revenue of Rs 22 crore. Assess this with the major boys: Nike posted FY06 income of Rs 99 crore Adidas was sitting down pretty with Rs 186 crore and Reebok was on the top of the heap with a staggering Rs 354 crore.
‘Who appreciates Puma’ was how Ganguly’s bosses mocked and pricked the enthusiasm of their soldier who was about to snap the buckles and set on new marching shoes. The cockiness of the major brand permeated into the conduct of the top bosses. “There was a lot of doubt, which could have led to self-doubt,” recalls Ganguly. The issues questioned, however, experienced significant benefit. Was there space for 1 extra athletics brand name in India? Did Puma in fact stand a probability in its battle from the major boys? After all, Puma’s underdog position in India was a grim truth.
Ganguly’s intention was to keep business. The new recruit had lived a life of the underdog, and a sequence of déjà vu moments only built him far more dogmatic.
5 several years in the past, in 2000, when Ganguly produced it to IIM-Lucknow, the maths grad from Bhagalpur University in Bihar encountered one particular these ‘who are you’ minute. “What is TNB college”, some of his batch mates took a dig, alluding to the institution from the place Ganguly graduated. Later on, when he stepped into the skilled planet, he realised that he did not have the ‘ABC’ of management on his resume. IIM-Lucknow was perceived to be fourth on the pecking purchase of IIMs—Ahmedabad, Bangalore and Calcutta had been the leading a few.
Again in early 2019, Puma sprinted in advance of Adidas. It posted a income of Rs 1,157 crore in 2018—Adidas’ corresponding number for FY18 was Rs 1,132 crore—and turned the greatest in India. The efficiency however couldn’t influence detractors. “Looks like a a single-time bump,’ and ‘the gap is not much’ were being some of the back again-handed compliments. Ganguly stayed mum. He stored jogging.
Speedy forward to March 2022. Puma has clocked Rs 2,044 crore in earnings in FY21 as against Rs 1,215 crore in FY20, making it the first multinational sportswear and style brand to enter into the Rs 2,000-crore club in India (see box). What, even though, is most attention-grabbing is the large leap above its rivals. Puma is now even larger than Adidas, Reebok, and Nike put together. The underdog is now the prime canine.
Ganguly reckons the underdog tag stoked hearth in his tummy. It designed him perpetually hungry, and relentless. “It has actually labored in my daily life,” he says. “I knew some others experienced far more methods, but I experienced to maximise what I experienced,” he provides.
In the meantime, in March 2020, Puma observed itself in a odd problem. January was the greatest the enterprise had noticed in India. Two months later on, the nation went below the initially spell of lockdown. The problem was grave. With detrimental and uncertain small business ecosystem, a pessimistic outlook on the career entrance, and hyper subdued customer sentiment, companies and brands went within their shell. Everyone started off cutting charge, halting expenditure and suspending operations. “For the 1st time in our historical past in India, income dropped,” suggests Ganguly. The firm shut 2020 at Rs 1,215 crore, as versus Rs 1,413-crore earnings that it clocked in 2019. Human intuition would have meant doing exercises additional caution, Puma resorted to animal instinct.
It went for the eliminate. Puma sniffed an prospect as operate-from-dwelling and on the net classes established massive demand for athleisure dress in. Whilst, in 2018, clothing created up just 32 % of Puma’s sales, it touched virtually 40 per cent in 2021. What also served was the guide the manufacturer had on the electronic curve. Whilst, in 2018, most trend and sportswear models struggled to get their on line act alongside one another and continued to keep mostly offline, Puma had previously designed heady gains as 19 percent came from on-line gross sales. In two years, the numbers pretty much doubled to 36 percent, and touched 43 p.c in 2021.
Curiously, Puma’s intense offline play gave momentum to on the net gross sales. The German model held on expanding offline footprint in the nation. From 360 retailers in 2020, the count jumped to 411 in 2021. Whilst stores ended up having orders on WhatsApp and providing to the buyers, Puma rolled out experiential retailers with F1 simulator, personalisation counter—get identify, amount, and design embroidered or printed in 30 minutes—and launched restricted-version items.
There was also something—an experiment—which restrained Puma from staying defensive in its method. The manufacturer launched ‘Puma on the Go,’ a customer outreach programme whereby it set up pop-up stores at household societies across the place. “It modified the trajectory of our offline retail enterprise,” contends Ganguly. “It instructed us we should be additional bold about our organization,” he provides.
What also aided Puma’s sprint was its go to hold the promoting and advertising and marketing faucet jogging in complete movement. It doubled down on its collaboration with Virat Kohli for his brand One particular8, which it commenced in 2018, decided to sponsor football by using workforce sponsorship of Mumbai Metropolis Soccer Club in ISL in 2020, and stitched yet another athleisure collaboration with cricketer KL Rahul and rolled out 1DER. Yet another daring shift was to associate Royal Challengers Bangalore final year, which built its 1st athletics MNC sportswear brand name to be a part of the IPL bandwagon after five decades.
Ganguly points out the state of mind and the aggressive enjoy. When the ball swings and the problems are overcast, one particular must adapt and however search for scoring. “Covid was much more than a swinging ball. It was a curved ball,” he claims, incorporating that the brand continue to necessary to rating. “Those who enjoy for attract really don’t acquire,” he says.
Puma’s massive wins in India, reckon retail experts, can be described by a bunch of factors. Very first is the underdog tag. “It didn’t have everything to shed of dread in India when it commenced,” says Ankur Bisen, senior vice president (retail & customer solutions division), at consulting organization Technopak. The world bitter rivalry of the siblings—Puma compared to Adidas—was not taking part in out in India. Second, a expanding Indian industry, increasing aspiration of customers and ballooning profits intended that the need for global makes was not going to die. Puma manufactured the most of it. 3rd, it learnt from the blunders of Adidas and Nike. While the former was grappling with the Reebok fiasco, the latter struggled with its franchisee associates. “Puma observed, concentrated on on the net, and played a clever offline retail game,” he states. Fourth, the manufacturer partnership it stitched with top rated cricketers compensated off. Whilst A single8 clocked a meaty Rs 175 crore previous year, 1DER did Rs 40 crore.
What also aided, underline brand name gurus, was a relentlessly intense tactic. Harish Bijoor, who runs an eponymous model consulting agency, points out. There are makes with image, and then there are people who have image as nicely as earnings. “On the initial count, Nike did exceedingly very well,” he suggests. Puma, although, falls below the 2nd bucket. “It lived up to its name and billing,” he adds. When the last-mover benefit assisted, remaining electronic native arrived as a massive blessing.
To a sure extent, the weakness of the rivals as well came handy. Whilst India progressively turned into a blind spot for other global sportswear makers, Puma found the discipline broad open up. “For all overseas gamers, India by no means experienced a trouble on need entrance,” claims Bisen. If other manufacturers failed or struggled, it was mostly thanks to a disconnect in global and India approaches and management blunders. One particular of the top rated makes retained flirting among a sturdy worldwide executive and a small-known Indian administration. And those who received their act right, built most of the problem. Glimpse at Skechers, which is now the 3rd-most significant sportswear manufacturer in India (see box). “Puma ticked all packing containers,” he claims.
But can the disruptor get disrupted? Can Skechers pose a obstacle to Puma? Bisen reckons that the combat could possibly occur from two established of contenders. 1st, a new bunch of property-developed D2C brand names, and the next is from the likes of Skechers.
Ganguly, for his part, is knowledgeable of the threat. “We are not complacent,” he says. If Puma can dethrone the incumbents, then it could confront stiff fight, way too. What, however, he is banking on to tide above potential issues is an unsaturated Indian marketplace, and an animal intuition. “Rs 2,000 crore indicates nothing if we never stay nimble, agile and intense,” he states. The Massive Cat is however hungry and on the transfer.
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