Lacoste has launched a new store concept where the brand is using in-store furniture which is more premium in look and feel. The brand will be experimenting with new types of products, which are more premium than what they are selling now.
In an interview with Indiaretailing Bureau, MD & CEO, Sports and Leisure Apparel Ltd. (Lacoste Licensee in India), Rajesh Jain said, “The look of the store is more premium and as far as the pricing is concerned, we are going to increase the pricing depending on the overheads and other conditions.”
He further added, “Not only in India, this premiumisation of our products has already started around the world. The new stores that we have opened at the airport and DLF Mall of India have been designed under this premiumisation concept.”
Lacoste – which currently has 50 PoS including a website and is present in 18 cities in India – is however, in no hurry to expand its presence in the country.
On an average, Lacoste opens seven to eight new stores every year. The brand had paused its expansion for one year in 2015-2016 due to uncertainty in the economy at that time and no new premium retail developments were coming, but now with premium retail developments coming up, and the retail economy more stable, Lacoste has decided to start slowly and steadily working on its expansion plans.
Talking about these plans in detail, Jain said, “We are into accessible luxury market where expansion cannot be too fast like in the case of a fast fashion brand or a mass brand or even a premium brand. Our luxury brand has to maintain its own niche, its own presence. This is the reason we also follow ‘selective distribution network’ throughout the world, which means that every new door that we open is evaluated very carefully. We also put a lot of thought into our location strategy.”
He further added, “We see the premium environment and only after that do we decide to open a new store. In India, premium retail developments are limited. We launch stores only in premium retail developments that sync with our brand DNA. This is one reason we do not expand too fast.”
With such a strategy, the brand naturally gets most of its customers from Tier I cities. On the other hand, the online business, for Lacoste is booming in Tier II cities who don’t have access to the products offline. Despite this, Lacoste has no plans to open brick-and-mortar stores in Tier II and beyond, unless premium retail developments with like-minded brands are present there.
“As far as Tier II cities are concerned, we plan to explore them through our online channel instead of physically going there. Again the reason is premium retail development which is currently not present in Tier II cities in an offline model. We reach them through our website and it’s effective because we get a lot of online consumers,” said Jain.
Is Franchise The Way Ahead?
Till two years ago, Lacoste was expanding mostly through company owned doors. At that time, the brand had just two to three franchisee stores. Later, Lacoste revamped its strategy and decided to go in for company-owned as well as franchisee stores. As of today, most Lacoste outlets are company-owned but franchise stores have started contributing to a decent percentage of sales.
According to Jain, “The reason behind shifting to company-owned plus franchise stores is to leverage the brand. Two or three years ago, we were shying away from going to far away cities. We then realised that we have the right kind of TG and looking at the new retail developments coming in, we decided to start looking for like-minded franchise partners.”
Omnichannel for Lacoste is still in the initial stages as far as India operations go, but the brand realizes its importance in providing a seamless experience to customers.
“There are a few customers who do not find the product in the store, so, to address the concerns of these customers, we would like to go in for Omnichannel retailing. We are currently evaluating which partners to choose, which kind of Omnichannel experience to provide, whether we should have a seamless integration of our inventory on online v/s offline or whether it should only have the offline currently,” concluded Jain.