THE COMEBACK OF THE BATA

(Case study)
Dr. N. Srividya
V. N. Sreedhar
ABSTRACT
Indian footwear industry is second largest next to China and it is
segmented in two ways namely organised sector and unorganised
sector.

Organised sector includes market players like Bata, Liberty,

Adidas, Metro etc and it serves to 1/3 rd of the market. The unorganized
sector serves the rest 2/3rd. Further it is more segmented into men,
women and kids market. Mostly women and kids are catered by the
unorganized sector.
BATA, it may not be exaggerated, if I say, that there would be no one in
India who would not know this name.

Most of us are brought up

wearing those shoes, chappals with white sole and blue straps. The
unanimous name known for footwear was Bata in 1980s. Families used
to visit these showrooms for their entire family purchase, be it for
children, women, men, formal or informals or executive one stop for all.
It may not be exaggerated if I say that the company enjoyed almost
monopoly those years.

Later on, Bata started outsourcing for their

products and the quality gradually eroded away along with the brand
name. Many people who were real loyals for the company also shifted
to other brands.
The company realised it very late and started reengineering their
product line and their strategies.

Meanwhile many other companies

took part of its market share leaving a little for Bata. The company

suffered at its top as well as bottom level making huge ultimate losses
finally in early 2000s. Soon, the company started reworking, but this
would take time to change the perception of the people.
This case study highlights the various strategies adopted by the Bata
Management in the current market trends with increased competition
from local players and Chinese imports.

Bata usually targets lower

middle and middle class segments of the society, but now it is

contemplating changes to survive in the competition. This paper deals
all these issues in detail and offers few suggestions as well for its
future recourse.
Keywords: Bata, Chinese imports, reinvention, Mr. Villagran, future
strategies, SWOT analysis, profits and losses.
1.0

INTRODUCTION

Bata is the favourite footwear brand in India. It is the largest retailer

and leading manufacturer of footwear India.

The company was

actually born as T&A Bata Co. in 1894 in Zlin, Czechoslovakia (Czech

Republic) and it entered India in 1931. The company is incorporated as
Bata Shoe Company Private Limited, set up as a small operation in
Konnagar (near Calcutta) in 1932. By 1934, the foundation stone was
laid for the first building of Batas operation.
doubled in area in the following years.

The overall site was

This town ship is called

Batanagar and it was also the first manufacturing facility in the Indian
shoe industry to receive the ISO: 9001 certification.
The company changed its name as Bata India Limited after going
public in 1973.
India.

Today, Bata India is the largest footwear retailer in

Its extensive network of over 1200 stores across India is

unmatchable to its competitors.

Their stores are present in good

locations in all the cities and towns. The Bata store is one of the most
recognizable and favored landmarks in major cities in India. Their
stores offer a superior shopping experience to the customers with
better quality products. In addition to the retail stores, Bata operates
non-retail distribution network through its urban wholesale division in
large scale catering to the millions of customers through over 30,000
dealers.
1.1

Indian footwear Industry

Indian footwear market is estimated at about Rs. 19,900 crore with a

growth rate of 8 10 percent (according to the data provided by market
advisors in September 2011).

The category covers casual, formal,

semi formal and sports shoes along with sandals for men and women.
Mens segment accounts for 59 percent and womens at 41 percent.
Casual footwear dominates nearly two-third of the total footwear
market.

Out of these again exclusive brand outlets account for 50

percent and by multi brand outlets at 28 percent. The preference to

the branded products is increasing as the consumers are willing to buy
from malls and other organized retailed stores.

Non leather

Leather

Figure-1: Share of Leather & Non- Leather Footwear Footwear

Production (2012-13)
Indian footwear industry was dominated by the unorganised sector
with a share of 70% in 2012. The unorganized segment comprises of

small cottage industry based manufacturers. The organized sector

comprising of major domestic and international players like Bata,
Liberty, Adidas and Metro etc, accounted for only 30% of the market.
The organized sector continues to grow rapidly as the customers are
willing to pay extra for the quality, Their changing life styles and larger
portion of disposable income is also a factor for this. The present size
of the market is Rs. 13,750 crores out of which organized sector is 37
percent. It is the second largest after China.
The organized segment can incorporate advanced technologies in
production to increase their market share which is not possible for the
unorganized sector.

Adidas has launched a new shoe with superior

cushion, optimal fit and temperature independence.

With such

advancements, the organized sector is expected to develop at a high

rate than the current rate of 10 15 %.

Unorganised Sector

Organised Sector

Figure-2: Share of Organized and Unorganized Sector in Footwear

Market (2012)
Source: Assocham
1.2 Market Segmentation
The footwear market can be segmented into men, women and kids
market and their share in 2012 is shown in the following figure.
S. No
1
2
3

Market Segment
Men
Women
Kids

Market share
55%
30%
15%

Men

Women

Kids

Footwear market type in percentages in 2012

Source: RNCOS Estimation

Casual

Mass

Premium Leather

Sports/ Active

Premium Non-Leather

Figure-5: Indian Footwear Market by Category (%), (2012)

Source: RNCOS Estimation
Further the footwear industry is again classified into casual
footwear, mass footwear, premium and sports footwear. The mass
footwear usually refers to low price footwear especially the slippers.
The casual footwear is for daily wear for schools, colleges and
workplaces etc. Usually the casual footwear dominates the mass
footwear.
1.3 MARKET SIZE OF FOOT WEAR INDUSTRY IN INDIA

The share of the casual footwear is 61% in 2012 and is expected to

dominate in the near future whereas the share of sports and premium
segment is also expected to grow. The estimated size of the market is
16000 crores out of which 70 percent is unorganized. Indian footwear
industry is 15 percent of global share. Many reputed brands like Nike,
Reebok are already manufacturing in India and manu more are trying
to enter to retail in India.
Apart from serving local market, India also exports to other countries. This included both
leather and non leather footwear in both men and women segments. India is a sleeping
giant with an installed capacity of 1,800 million pairs only second to China. It has over
100 fully mechanized, modern shoe making plants with global standards.

It also

manufactures for some good brands like Florsheim (US), Lloyd (Germany),
Clarks (UK), Marks and Spencer (UK).

The main export markets for

India are UK and USA both account for 55% of total exports. India has
its major production centres at Chennai, Ranipet, Ambur in Tamil Nadu,
Agra and Delhi. India offers benefits to other countries like low cost of
production, abundant raw material, and has huge consumption market.
Nearly 75% of the total exports come from Southern Region and
Northern Region, with a share of 13%. Nearly 83% of market is from
U.K., Germany, Italy, the USA, France, and Portugal. India is often
referred to as the sleeping giant in footwear terms. It has an installed
capacity of 1,800 million pairs, second only to China.

 The ladies footwear segment still remains the most untapped as

nearly 80-90 percent purchases happen in the unorganized
market

Bata India Ltd

Liberty Shoes Ltd

Reebok India Pvt Ltd

Khadim India Ltd

Relaxo Footwear Ltd

A didas India Marketing Pvt Ltd

Others

Figure Market Share (%) of Footware Companies

India is standing on the threshold of a retail revolution and witnessing
fast changing retail scenario, with footwear market set to experience
phenomenal growth in coming years. Besides, the entry of numerous
international players has had a significant impact on the Indian
footwear market and the demand for Indian footwear will continue to
grow in future as well, says our recent report.
Current trends of footwear industry
The Indian economy has shown a positive growth with gross domestic
product expected to grow at a rate of over 9 per cent in 2011-12. The
leather and footwear industry has been growing at over 20% for the
period spanning 2008 to 2011. Footwear alone has been projected to
make up about 60% of the total leather exports in the current fiscal.

Given this growth, India's position as a manufacturing footwear centre

and a producer of leather and fashion accessories has been gaining
international recognition. To help boost the Indian economic and
business environment, MM&T 2011 provides an ideal platform to meet
business prospects, clients & partners all in one location.
The future of the footwear industry
The domestic footwear market is being driven by growing fashion
consciousness due to increased disposable income among urban
middle-class and abundant availability of raw materials in the market.
Indian footwear industry possesses significant potential with
overall market anticipated to grow at a CAGR of around 9%
during 2011-2014. The report thoroughly discusses factors,
which will drive the growth of the footwear market during the
forecast period.
The estimated annual production capacity of Leather Shoe
Uppers is 112 million pairs
The Indian footwear market is estimated to be worth Rs.13,750
Crore and constitutes just about one percent of Indian retail.
The Indian footwear market was estimated at INR 22,000 Crore in 2012
and is expected to touch INR 38,700 Crore by 2015, growing at a CAGR
of more than 20%. Previously, the market has been growing at an
annual average rate of about 15%. Further, the market is expected to
grow at an average annual rate of 25% in the future. The domestic
footwear market is being driven by growing fashion consciousness due
to increased disposable income among urban middle-class and abundant availability of raw materials in the market.

MARKET FORECASTS
The average growth in the domestic industry has been estimated at
12% and is estimated to touch Rs. 47,000 crores by 2025.
In 2010, the Indian footwear market is expected to have value of
$4,380.3 million, an increase of 62.1% since 2005. The compounded
annual growth rate of the market in the period is to be 10.1%
India Footwear Market Value Forecast; $ million, 2005-10
year
2005
2006
2007
2008
2009
2010
CAGR,2005-10

$ million
2701.5
2960.4
3256
3589.7
3963.8
4380.3

INR billion
119.2
130.6
143.6
158.4
174.9
193.2

growth
9.10%
9.60%
10%
10.2%
10.4%
10.5%
10.1%

5000
4500
4000
3500
3000
2500
2000

$millian

1500

INR billian

1000

growth

500
0

turnover
69

bata
liberty

351.2

1 Bata is planning to shift its focus to women to power its business.

It will introduce concept stores for women in India shortly. It will
also be introducing a new ladies footwear brand called Sundrops
in India.
1 Over the past few years, many premium brands have entered or
have plans to enter into the Indian market.
2 Keeping in view its past performance, the industrys inherent
strengths and growth prospects, the footwear industry aims to
augment production, thereby enhancing its exports from the
current levels. According to Assocham, exports are expected to
grow at a CAGR of 15% in the next 5 years. The industry will
continue to focus on the European countries and the US markets
for exports.
3 With more and more Indian woman joining the workforce, the
ladies footwear market in all the categories/segments will grow
rapidly throwing up huge opportunities in an area yet to be fully
tapped by various players.

4 The total imports of footwear of US in 2012 were 2,28,19,69,730

pairs, with majority of imports being from China. The share of
India in total footwear imports of USA was just 0.6%, creating an
opportunity for India to further increase its exports to USA in the
future, by warding off competition of China through supply of
better quality products
ABOUT BATA

The company was founded in 1894 by Tomas Bata.

Under Jan Antonn Bata the company grew quickly and continued
its expansion throughout Europe, North America, Asia and North
Africa

Starting operations as a private company, Bata India is today

traded on the Kolkata and Mumbai Stock Exchanges
Bata Shoes (Czech: Baa is a large, family owned shoe
company based in Bermuda but currently headquartered in
Lausanne, Switzerland, operating 3 business units worldwide
Bata Metro Markets, Bata Emerging Markets and Bata Branded
Business.
It has a retail presence in over 50 countries and production
facilities in 26 countries. In its history the company has sold
more than 14 billion pairs of shoes.
Retail strategy
These strategies are to set up 60 large format stores, closing its
non profiting stores and by increasing its sales to institutional
businesses.
Bata has recently opened 32 retail stores in a minimum area of
3,000 sq. ft each, defying the trend in the retail industry of
putting expansion plans on hold.
The stores operate in a four-tier retail format under a new model

upmarket flagship stores

smart and trendy city stores

super stores

traditional family stores

Flagship stores are core stores for brand name retailers, larger
than their standard outlets and stocking greater inventory

The company has also focused upon providing the customers

with a novel trendy collection and better shoe designs.

The company is also depending on institutional business by

starting tailor-made shoes for hospitals, military forces, factory
workers and airlines

Sales strategy

Price is an important part of your sales strategy. It should be

neither too high nor too low to ensure enough customers &
reasonable profit.

Always convince your customer that youre offering a good

bargain, not giving away a cheap product. Batas prices can
prove to be a valuable asset to this sales strategy.

Pricing a product a little bit below your targeted price (like $4.99
instead of $5.00) can rapidly increase your sales.

Percentage

A ffordability

Familiarity

Quality

Bata is one of the world's leading footwear retailers and manufacturers with
operations across 5 continents managed by 4 regional commercial business
units

(CBUs).

Bata's strength lies in its worldwide presence. While local companies are selfgoverning, each one benefits from its link to the international organization for
back-office, systems, product innovations and sourcing.
Although Bata operates in a wide variety of markets, climates and buying power
Bata companies share the same leadership points. Two important ones are
product concept development and constant improvement of business processes
in order to offer customers great value and the best possible service.
Bata Shoes is a large, family owned shoe company based in Bermuda but
currently headquartered in Lausanne, Switzerland.
The company is operating 3 business units world wide:
Bata metro markets
Bata emerging markets
Bata branded business
Culture
It is the shared values, principles, traditions and ways of doing things that
influence the way organizational members act.
Bata is a well known organization which culture very much influences the
performance of its employees as its culture is very casual and family like. Its
monologue is people are our essence.
Research and development
Bata operates 6 Shoe Innovation Centres (S.I.C). Research is conducted
into the application of new technologies, materials and designs for shoe comfort
features.
Each S.I.C has a product focus to supply complete packages of services for the
manufacturing and marketing of innovative shoes.
Customer satisfaction
In any Bata store in the world, they guarantee customer satisfaction.
They provide satisfaction to customer through these strategies.
Guaranteed purchase
Wide collection

 Assured quality
Personalized attention
Product detail
Economy and annual growth
It has transferred sophisticated technology and business skills to the country
and provides direct and indirect employment to about 10,000 people. Bata also
supports a large number of local manufacturers by buying raw materials from
them.
Annual growth
The Company business witnessed its record level with net turnover of Rs. 6.429
billion signifying a growth of 26%
The Gross profit was recorded at Rs. 2.672 billion with
improvement of 23%
Operating profit increased from Rs. 691.095 million to Rs.
848.205 million also showing an increase of 23%
Profit after taxation was Rs. 585.512 million compared to Rs.
477.775 million of last year.
Bata-The Helping Hand
As corporate responsible citizen Bata is actively fulfilling its responsibilities
since when its started its business in the country. They are permanently
patronizing many charitable organizations and helping them in the form of cash
and free shoes.
BY VALUE :

It commands over 35 percent of market share in India

98 percent revenue comes from domestic operation.

STATUS/CLASS WISE :

Has already targeted the footwear for entire family

Position itself in Price and Quality

Target market to the RICH CLASS and UPPER CLASS

Positioning

To introduce FLAGSHIP stores and unique shopping experience.

New retail concept FOOTING

High brand recall for consumer lead to higher footfalls

PRICE :
All Over The Footwears : Minimum Rs. 199 Maximum Rs. 7500
PLACE :
BATA Flagship Store Block D Cannaught Place
Around 5000 Distributors across the country
PROMOTION :
Sales Promotion :

Display of new Products at cash Counters

Promotion of Brand Equity :

Gift coupons

Discover New Campaign

Online Processes :

Purchased from various shopping websites

free delivery promise

BRANDS OF BATA
BABY BUBBLES----Shoes (as well as clothing and accessories in Latam)
for infants from birth to 1-year Bata--Shoes for all occasions in ones
life
BATA INDUSTRIALS--Protective footwear for various industries
BOBBLEGUMMERS--Stylish and colorful shoes for active kids
COMFIT---Ergonomic design, soft uppers and cushioned insole support
are combined to bring you a collection of shoes for your ultimate
comfort. The Comfit range provides support and comfort in a quality
you can count on
ECO FIT--Eco-friendly shoes, made from ecological organic and
biodegradable materials

MARIE CLAIRE--Stylish and chic shoes for confident women

NIORTH STAR--The vision of youth daring, exploratory causal shoes.
PATAPATA--Our thong brand, ideal for sunny outdoor life
POWER--Power, our sports brand that brings out the spirit of the game
SANDAK--Practical plastic injected sandal for the mass market.
SUNDROP--A womens comfort shoe designed for office wear and
casual evenings.
WEINBRENNER--Our shoe offering for outdoors and adventure.

New special technology

Bata introduces the new special technology footwear for the growing
feet. Launched under the School Shoes umbrella, Bata brings you
selections like Champ, Tennis, Scout, Naughty Boy, and Ballerina.
The shoes are designed to fight odour round the clock. Besides the inbuilt Microban antibacterial protection in the insole material of the
shoe; this is designed to reduce unpleasant odours caused by bacteria
and helps keep the feet cleaner & fresher. Cushioned insole would
ensure total comfort for the little ones.
Thus these scientifically designed shoes are a complete solution to all
the worries of the mothers about their little ones playing for long hours
in the sun.
Toxicity and dermal studies have shown products with Microban to be
completely safe, non-toxic and non-irritating to skin. The Microban
protected liners keep shoes completely bacterial free, which result in

odor reduction, keeping feet clean, fresh and hygienic.

Microban is an anti-microbial agent which, when introduced into the
actual molecular structure of fibers, fabrics and polymers, provides
inherent control over the growth of certain odor and stain causing
bacteria, yeasts and fungi.
Bata is committed to customer satisfaction and to giving the best
services at competitive rates as well as offer shoeline as per the
specific need of customer.
Research Development
Bata

operates

is conducted

6 Shoe

into the

Innovation

application

Centres

of new

(S.I.C).

Research

technologies,

materials

and designs for shoe comfort features.

Each S.I.C has a product focus to supply complete packages of services
for the manufacturing and marketing of innovative shoes.
Shoe Making Expertise
Not only is Bata one of the world's leading footwear retailers but they
are also experts in making shoes, with over 110 years of experience in
manufacturing. Currently they operate 27 production facilities across
20 countries.
Approximately half of our factories output is destined for sale through
Bata-owned retail stores, and the balance is manufactured to the
specifications of wholesale customers or under contract to other
footwear brands.
Bata personnel made key advances in several footwear production
techniques in use today, including the Direct Vulcanization Process

(DVP) and slush-moulding. Bata inventors also patented the original

process that adheres PVC outsoles to textile uppers.
During the 1990s additional patents were awarded, including one for
the first removable heel cartridge system for athletic performance
footwear.
Most of Bata manufacturing facilities have passed stringent ISO 9000
certification, with others presently in the certification process.

Bata

has its presence in the other countries also like Italy, Canada,
Netherlands, Indonesia,

China, Pakistan and Africa.

The consolidated revenue and EBITDA of the company has grown at a
CAGR of 11% & 41.6% respectively over the last 4 years. This growth
was

driven

modernization,

by

strict

cost

consolidation

control,
of

improved

manufacturing

product
operations,

lines,
and

transformation of the wholesale business. At a current market price of

Rs.252.6, the company is trading at 20.8 times its estimated FY10
earnings and 16.5 times its estimated FY11 earnings
Export
first mass product, the Batovky

The company has a licensed capacity of 628 lakh pairs per annum
spread across its five
manufacturing units at Batanagar (Kolkata), Faridabad (Haryana),
Bataganj (Bihar), Peenya (near Bangalore), and Hosur (Tamil Nadu).
The company has two tanneries - one at Batanagar and the other at
Mokameghat (Bihar). The latter is the second largest in Asia. In total,
Bata India employs more than 12000 people.
Bata sells over 60 million pairs of shoes every year. South India is a
major market for Bata, from where it earns around 40% of its revenue.
The company is the market leader in South, with 16% share of the
organized footwear market. Of the overall revenue, it derives nearly
85%

through

retail

networks,

(dealers/institutional/industrial

14%

sales)

from

and

non-retail

remaining

1%

channels
through

exports. Thus, the domestic market is the mainstay as far as revenues

are concerned.
Bata House Gurgaon and Bata India Factory at Batanagar
India's Turnover crossed the coveted mark of Rs. 20,000 Million for the
financial year 2013 by achieving a total turnover of Rs.20, 984.1
Million. It also recorded a Net Profit of Rs.1, 907.4 Million for the year
2013.
Traditionally Bata targeted the segments lower middle and middle
class segments.

But with the increased competition from imported

China footwear, Bata is finding difficult to survive in the segments. To

compensate that, now it is moving into upper end into the premium
segments as there the competition from the cheap Chinese products is
much less.
But the established brand name and brand personality of Bata does
not allow them to suit to the premium segments. The brand image of
the Bata was developed for over 40 years to meet the functional needs
of the middle class customers.

Currently it now enjoys 35% market share in the organized footwear,

selling 45 million pairs of shoes a year.
Brand story: Till 1980s it enjoyed the monopolistic position with
instantly recognizable brown leather sandals and blue-and-white
rubber slippers.
Target Customers
There is a confusion of the brand image and the brand personality of
Bata now as they are targeting on both the segments. They need to
convey the message very clearly and more precisely to the customers.
Brand Identity
This brand is mostly identified and connected with mostly by middle
class customers as they expect that the shoes within the range of
Rs.300 to Rs.1500 is available to all the age levels from school going
children to aged persons.
Brand Personality
When the brand personality is discussed, the Bata customers are price
sensitive, demanding value for money, looking for utilitarian needs are
met, expecting the shoes would serve them for a couple of seasons
without any complaints. Usually the whole families visit a Bata store
as Bata has various offerings to each of them.
Value Proposition for the Customers
Bata offers the following propositions to its customers. They are

Reasonable quality at low or reasonable price

Footwear for the entire family

Footwear catering to various functional needs e.g. sports, casual

footwear, formal-semi formal

Conveniently accessible outlets in various parts of the country

High social visibility because of its vast presence across the

country

Positioning of the Firm

Variety-

Bata usually targets lower middle class to middle class

customers. But now it is trying to enter into the upper segment like
premium brands.
Needs - Bata positions itself to cater the needs of whole family
altogether.
Access - Bata has vast reach in their products to the customers with
their extensive network of the outlets across the country retail and
wholesale as well.
Sustainability

of

the

Positioning

Bata was successful in

positioning itself when it concentrated on the lower segments.

But

now with the emergence into the premium segments, it sustainability

is at test.
Brand Image - With the entrance into the premium segments, there is
a chance for confusion in the minds of its customers about its offerings
and varieties. Its established brand image may get impacted with this
emergence.

Activities the activities they take after the entrance into the new
segments are not seemed aligned with their strategic goal or purpose.
The activities like manufacturing in-house or outsourcing, or having
four categories of outlets (A, B, C, D), or retailing or wholesale
channels, lower or upper segments do not help in conveying a clear
and consistent message to the customers as Bata failed to make any
particular trade offs with the key activities.
Internal Coordination Internal coordination is very much sought
after in a company where a wide range of activities and practices take
place.
Sustainability of Competitive Advantage
Because Bata is not known for its premium brands, it may be difficult
to them to sustain the competitive advantage in the particular
category. When people are buying the premium products, they would
also watch the brand image and the brand prestige as well along with
the offering. Since for over 40 years Bata is known for non-premium or
non luxury category, it may become difficult to get established in the
particular category.

After sustaining, comes the reinforcement and

optimizing in the particular segment. For Bata, the first step itself may
take a long time.
For 40 years Bata was the ultimate choice for the family all the age
groups and tastes. It is an evergreen brand. But the challenge came in
1990s when new rivals entered the market and in 2004 the sales were
the lowest which compelled the company to complete makeover. In
March 2008, its managing Director Marcelo Villagran launched a new
advertising campaign to visit the stores to get surprised.
SWOT Matrix

Strengths

Weaknesses

1. Brand Image
2. Reasonable

1. No continuity of leadership
quality

at

low or reasonable price

2. In 2001, 5% decrease in net

sales

due

into
3. Diversity with ranges in
running, training, court,

to

premier

(improper

diversification
segment

targeting

and

positioning)

basketball, football and

outdoor

3. No proper planning regarding

Advertisement and Promotions

4. Footwear for the entire

family

4. No

variety

in

Fashionable

shoes
5. Financially strong
6. Conveniently accessible
outlets in various parts
of the country
7. Targeting

all

income

segments
8. Provide

training

managers

for
and

employees
9. Nationwide

retail

netweork
Opportunities
1. E-commerce

Threats
1. Customer dissatisfaction

2. Acquired,

parternership

2. Price wars with comopetitors

with small players

3. Competitors
3. Entering new segments
4. Political instability

of markets
4. Capturing market where
no

other

potential

competitor exists

5. Economical threat
6. Changing

in

consumer

preferences

5. Innovative products
6. New

mediums

for

advertisements
Manufacturing:
Bata can use the international expertise e.g., in Malaysia for rubberbased shoes, in China for artificial leather shoes to cut down the costs
using economies of scale. It can also stay in International markets to
compete with the potential competitors.
Distribution:
With company owned stores it can control and manage better the
operations apart from arranging more training programmes for the
employees to have better quality.

With the training the employees,

they can also open more franchises to get more profits. The wholesale
channels can be stopped for the enhancement of the brand image.
Brand value
Bata has held a unique place in the hearts and minds of Indians for
nearly 80 years.

Excellent relationship with employees as well as the customers.

Eg. Establishment of small towns such as Batanagar Bataganj in India,
Batawa in Canada.
Bata believes in serving people and not in profit making.
Bata has created unique image in consumer mind as footwear
producer. Consumer easily connects Bata as Shoe Company. It has
positioned itself as, one Bata, one world.
Positioning
We can also see that the positioning of the brand is very well done in
minds of all the segments of the country. The segmentation, target
customers were very well focused. The sale of Bata is increasing and it
is doing well.
As the lower class prefer to Chinese and local shoes, Bata should
concentrate on middle and upper class. They should continue to grow
in the upper middle class segment with offering better products for a
reasonable price.

As Bata is known for reliability, instead of

fashionable footwear, they should concentrate on Bubble gummers.

Chinese imported shoes and local shoes are not a major threat to Bata,
as Bata is known for reliability and quality. Now a days people pay a
little extra if the product is good.

Bata should more consolidate on

quality and maintain good relationship with the customers for repeated
purchases. This would enhance the brand equity. Bata should more
concentrate on Market Penetration Strategy to build up the brand
equity.
BATA Wrong Target challenges in Indian market

Overt the years Bata has changed its appeal from a shop that sells
Hawai slippers and Canvas Shoes to a shop that flaunts brands like
Reebok, Nike and Marie Claire that always has a special charm with
young adults and students.
But, Bata does very little promotional activities. Although Bata has
done a lot to revamp the brand, these efforts are not well
communicated. Their promotion is restricted to seasonal offers in the
form of Sale, but the advertisement part is missing. There are rare
ads of Bata seen by the customer both in print and electronic media.
Gone are the days when people considered Bata as a brand that only
sold hawai slippers and canvas shoes.
Today, Bata caters to the footwear needs of almost every strata of
society.
Bata Macho offers a wide variety of footwear options in the Mens
segment. From Sparx and Power to high end brand like Reebok, Nike
and Hush Puppies.
Whereas, Bata Damsel tries to ensure that women who turn to Bata for
their footwear needs are completely satisfied. Apart from their own
products, Bata sells brands like Marie Claire and Hush Puppie through
their stores.
Low quality of shoes threat of shift in production to other areas or
countries where wages levels are low if the quality is maintained at
same level
Most companies work on subcontract basis design, component
selection and methods of production are given by the buyers and do

not provide their own fashion collections, however companies are able
to make prototypes based on ideas provided by the buyer
In the early 1990s, Bata decided to move towards high-end segments
of the Indian shoe market.

It also launched few brands in these

segments with higher prices, but landed in trouble.

1. The segment is meant for companies like Bata. The size of the
segment is too low for a company like Bata. The size of the
segment is around 5 10% of footwear market in India. It could
not produce volumes that Bata used to for the traditional
footwear.

High volumes are essential for Bata for a healthy

bottom line.
2. Bata started neglecting its core segments, which it was serving
for nearly a half century. The company started to focus on the
top end products at the cost of the lower end products.

As a

result the smaller players started taking off the market share
from Bata in the lower end, while the established players in the
top end market challenged Bata severely. Ultimately the market
share of around 15 percent in mid 1980s, fell to 10 percent in
mid 1990s and finally the company was in loss of Rs. 42 crores
in 1995.
The Bata had to come back to its lower segments as a core focus on it.
But the top end brand like Hushpuppies, which it had started are
continued selectively in selected stores only.
Financial Analysis

Bata India reported excellent growth in PBT in third quarter of

2011 at 46.2% growth rate

QoQ at Rs.4503.3 lac as against Rs.3080.3 lac in the same period

last year.

The net sales of the company grew by 26.8%

Bata India was selected as the Powerbrand in the Powerbrands

2010 by the Indian council for Marketing Research.

Bata reported a growth in net income from operations at 9%

growth rate QoQ at Rs.408.01 Crores as against Rs.453.87
Crores.

Analysis of 4ps
PRODUCT: Bata sells all the range of footwear from shoes, canvas,
belly, leather shoes, sandals, school shoes, flip-flops etc.
PRICE: The price is considered as the most dominant P in the
product mix. The pricing of Bata has been very nominal and user
friendly for the customer which Bata targeted
PLACE: Place and location is the important and prominent in any retail
store. Bata has provided as a place where you can find all kinds of
footwear at just one stop. In all metro cities Bata is located in all the
prime areas of the city and also exists in almost all the cities of India.
People look for Bata as a reliable place for their footwear requirements.
PROMOTION: Bata does not promote much by advertising. Bata
mainly promotes by providing sale in their existing product lines .it
also promotes itself by keeping international/premium brands like hush
puppies, Marie Claire etc.
7.0 Diversification of Bata

 Bata build Towns And Factories (1915)

The Energy Industry (1917)
Agriculture (1917)

Forest Farming (1918)

Newspaper Publishing (1918)

Brick Manufacturing (1918)

Wood Processing (1919)

The Rubber Industry (1923)

The Construction Industry (1924)

Railway And Air Transport (1924)

Book Publishing (1926)

The Film Industry (1927)
Food Processing (1927)
Chemical Production (1928)
Tyre Manufacturing (1930)
Insurance (1930)
Textile Production (1931)
Motor Transport (1930)

 Sea Transport (1932)

Coal Mining (1932)
Airplane Manufacturing (1934)
Synthetic Fibre Production (1935),
River Transport (1938)
BATA on RAMP
3.1.4. 99 Magic formula: The psychological factor of prices
ending with 99 gives the
consumer a feeling of a good bargain price as against a cheap prize.
Bata India have
cleverly managed to use this strategy to their advantage.
4. Analysis of product and generic competition to the brand.
When we think of BATA, the first thing that strikes us is its
INDIANNESS. According to the HR manager BATA, it is the mass
appeal that drives a customer to a BATA store. This is largely because
BATA offers the masses products and gifts in every possible price range
they can think of. The brand identity and position of BATA has been
carefully crafted and painstakingly embedded as a value proposition in
the minds of consumers for generations. It certainly promises a lot of
value by virtue of consistent quality and positive word-of-mouth.
According to Mr. Anjanay Shrivastav (HR manager), most of the people
in India don't even know that BATA is not an India based brand. An
example of mass appeal is also seen in the fact that the school shoes
category is synonymous with BATA.
The total revamp that BATA got as a brand in 2005 is aimed at
targeting audiences in every income group. And hence, the brand

came up with products targeting the youth, corporate executives,

working women, sports enthusiasts and children. Prior to this strategy,
BATA was considered to be the Parle-G of the footwear industry,
mass producing shoes and sandals of the same type and features for
all kinds of target audiences. Hence the new strategy was a huge
development from its previously rigid and old-fashioned brand image.
As part of their new strategy, the new brands that came about were:
NorthStar(youth),

Marie

Claire(women),

Bubblegummers(kids),

Weinbrenner(Men) etc. However, one fundamental strategy that BATA

did not execute was the effective promotion of these brands in terms
of their advertising. These new brands did not have separate identities
of their own and hence did not succeed in creating
images of their own.
BCG Matrix of BATA:
BCG Matrix describes the companys Portfolio analysis with respect to
its Market share and current market growth rate. Due to the
competition from local brands of unorganized retail and presence of
low cost emerging brands like Paragon, Relaxo, Khadims, Sreeleathers
etc. Bata is losing its market growth though it has high relative market
share. With incomes growing, Bata needs to understand how consumer
aspirations change and find ways to meet the changing needs. So, in
the coming years, Bata needs to focus on consumer insights,
innovation, renovation as well as improved value chain management
for a good performance.
Generic competition to the brand
Indias per capita shoe consumption or the number of footwear (shoes,
chappals, sandals) worn by an individual has gone up from 1.4 shoes a
year in 2004 to 2.2 shoes per year in 2010, according to data from the
commerce ministry, While in absolute percentage terms this might
not seem like a lot, in a country of a population of one billion people,
the fact that in six years people have gone from consuming 1.4 shoes

a year to 2.2 shoes a year is a big change, said Suman Roy Burman,
president, Khadims, a Kolkata-based manufacturer and retailer. The
average shoe consumption in developed countries is about five per
person per year.
Comparision with Other Brands
In order to devise a competitive strategy for BATA, we need to analyze
Porters Five Forces Model. The model analyses the different aspects of
attractiveness and competitiveness of the market.
Bargaining power of customers:
High
The potential customers for footwear industries can be broadly
classified into two categoriesPrice sensitive customers who have a huge bargaining power owing to
the presence of low cost brands and local products.
High end customers who prefer to buy discounted and high sale
products from retail outlets or through online shopping like Jabong,
Myntra, Yebhi etc.
Bargaining power of suppliers:
Low
Shoes are made of leather, rubber and nylon etc. The materials could
be classified as commodities, where the manufacturing process adds
the value.
For this reason supplier have limited bargaining power over buyers.
Threat of new entrants:
Low
As this company has established its name in billion hearts, customers
are keen to go for well-known brand; hence the prospects of a new
entrant in the market are significantly reduced.
New entrants like Sreeleather, Relaxo are constantly challenging Bata
in low cost segment for last 5-10 years.
Threat of substitute products:

High
As customers are often ready to switch brands and try out different
products of the competitors in their search for the best possible deal in
terms of price, quality of service etc, the threat of substitute products
of Khadims, Liberty, Paragon etc is high.
Intensity of competitive rivalry:
High
Rivalry is more intense as there are lots of equally-sized competitors in
India e.g- Liberty, Khadims etc.
Aggressive growth strategy of other brands with low switching cost
rivalry is more intense in footwear industries.
Porters Five Forces Model
Product Development
Diversification
Market Development
Better Quality at Low Cost
Customer Care Initiatives
Strategies

adopted

over

time

by

the

brand

to

tackle

competition or prime market expansion.

To tackle competition and expand the market share Bata is adopting
strategies over time e.g. aggressive retail expansion, promotion of its
brands, contemporary styling, and quality control and strengthening its
human resources. As far as growth strategies and competencies of
Bata are concerned in Prime market expansion, they can be
categorized as:
5.1.Product Development and Diversification:
Bata has been holding a unique place in the heart of Indians for more
than 75 years. Bata
Products have been designed as per various functional needs e.g.
sports, casual footwear,

formal-semi and formal. From contemporary to fashion shoes, sports to

outdoors, Kids to teens, Bata today stands for trendy, colorful &
youthful footwear destination offering shoes & accessories for the
entire family. With more than 1500 designs to choose from, the design
inspirations are upscale international at affordable price. Bata today
design, source & market many international footwear brands such as
Hush Puppies, Naturalizer, Marie Claire, Sundrops, Dr.Scholl's, Power,
Weinbrenner and many others. The name Bata is not limited in
footwear industries, but Bata is also trying to excel in the arena of
other propositions like- Umbrellas, Belts, Bags and Sunglasses etc.
5.2. Market Development:
The customer value proposition is substantial as Bata offers value for
money along with the trust which its customers have because of the
established Bata brand. In terms of access, functionality and selection
options it always fulfils its promises of being a family outlet where each
member of the family can buy something. To increase the contribution
from women and children's footwear segments, Bata increased the
display area for both segments across all stores, complimented by
launching newer trendy designs under brands like Marie Claire, Hush
Puppies, North Star etc.
Bata had made its presence in all corners of the country to introduce
its current products into new market segments- thereby accessibility
to everyone becomes possible for the customers.
Bata derives nearly 85 per cent of revenue through retail networks, 14
per cent from non-retail channels (dealers/institutional/industrial sales)
and balance 1 per cent through exports. About 80-90 per cent of the
retail revenue is from Tier I and II cities, presenting a huge opportunity
to tap rural and semi-urban markets, which are mainly serviced
through dealer networks. Bata has been present in towns with a
population of 500,000 and above and plans to expand to 400 plus

cities, with a population of more than 100,000, to improve presence in

Tier III and rural markets through the wholesale division
5.3. Better Quality at Low Cost:
Retail footwear segment in Indian is very price sensitive and has been
steadily growing over the years. Major part of the demand is met by
brands like Bata and Liberty. While international brands largely
dominate the higher end of the spectrum, the lower end of the market
is dominated by home-grown players as well as unorganized players.
5. 4. Customer Care Initiatives:
During the year 2013-14, Bata has further strengthened its customer
care division. Effective and satisfactory customer service continued to
delight the customers at various points, i.e., starting at retail stores,
during the sale interaction, post sales services at Customer Help Desk
and obtaining feedback from the customers. A new initiative - Passion
to Serve program has been adopted for the sales personnel which
entitles them to periodic promotions. An exclusive Customer Help Desk
has been in place to assist the customer and to locate stores, inform
product availability, process online orders and to acknowledge all their
valuable feedback. On the Digital Space, through Facebook, Bata has
entered into over 100,000 customers' personal space and acquired
more than 250,000 Likes on Bata Facebook page.
Advertising, Sales Promotion and Segmentation Strategy
TAG-LINE
PRINT ADS
TV-ADS
ROAD SIDE ADVERTISING
CELEBRITY ENDORSER Rani Mukherji
SPECIALIZED SHOES

NEW STORES
RETAIL SHOPS
PRICE PROMOTION: Price promotion refers to price discounting. It
is done by two ways, namely
DISCOUNTS: A discount on the normal selling price of the product. For
example Bata a family footwear brand with showrooms all over the
city, is offering discounts ranging up to 30% on shoes, sandals,
chappals, ladies footwear, kids footwear and mens footwear. This
offer is available at all Bata footwear showrooms in Hyderabad.
STOCK CLEARANCE SALE: Bata often has stock clearance sale
which helps in boosting up the sales figure.
GIFT WITH PURCHASE: Bata introduces Gift Vouchers Giving
vouchers are a first of a kind initiative in the footwear retail industry,
Bata India introduced it for the time, Bata Gift Vouchers. These gift
vouchers can be used in place of cash and are available in various
denominations to provide the convenience and choice to purchase a
wide range of footwear., Bata Gift Vouchers are targeted at three major
segments employee incentives & rewards, business gifting and
customer

promotions.

They

are

also

very

ideal

for

customer

promotions loyalty reward points redemption, sales promotion &

contests, etc.
99 MAGIC FORMULA: Bata has managed to keep its pricing
competitive and attractive for its customers. It has products for every
foot and every social class to suit every member of the family. Bata is a
value for money footwear brand says Villagran.
EXCHANGE POLICY: In case if a customer is not satisfied with the
product he can exchange it within 7 days provided the product is
unused, clean and in their original state of packing.
Distribution strategy followed by the BATA

Wholesale Channel Classification

Dealers
Family stores located in major cities. Some of the stores are airconditioned. Products consist of medium to high priced shoes for the
whole family. These shops deal in local brands and unbranded shoes
from small manufacturers.
DSP - Dealer Support Program
Independent dealers who buy 100% of their assortment from Bata
depots. A product mix of low to medium priced shoes for the whole
family. DSP customers are allowed to use red and white square check
signboard as per established policy.
Wholesalers
Shoe traders who buy merchandise to resell to traditional dealers
located in rural areas and street markets of major cities/towns. They
keep inventory for replacement and sell on credit or cash basis. Their
focus is on volume products, some of them sell to institutions.
Industrial / Institutional
Large industries and private or public institutions who need to buy
footwear for their own
workers can approach Wholesale division for their requirements.
Department Store
Big multilevel modern and full service stores located in major metro
cities. Selection of medium to high priced shoes for men, women &
children. The collection comprises products with local and International
brands. Full air-conditioned environment.
Retail Store profile classification
With the shrinking of the world into a small global village, Indian
consumers now aspire for international taste and style. Bata has more
than 1500 retail outlets in India and they aspire to start 100 new
outlets every year. To make things easier for the consumer Bata India

has introduced the concept of store classification and sub divided it

into Flagship, City, Family and Bazar stores.
Flagship
In metro cities. High class location. Fashionable products. Imported and
International brands, air-conditioned, luxurious and cozy atmosphere
with comprehensive mobile display units with new arrivals.
City
In Metros and semi Metros. High and commercial locations, shoeline
catering to the needs of fashion-oriented middle and high income
group consumers. Air-conditioned store with panel display and mobile
display unit for brand promotion with new arrivals.
Family
High Traffic commercial location in major and boom towns. Medium to
high priced basic
footwear, Non-air conditioned store with total commercial look, mass
display, standard panel and stooping rods.
Bazar
High traffic non-commercial location as destination store and small
existing stores in thickly populated and saturated markets. Basic and
volume selling lines for low and medium segments including liquidation
and sub- standard clearance.
Exports
BIL (Bata India Limited) exports around 3 million pairs of shoes and
other footwear annually, primarily to Western Europe, Middle-East and
Far-East markets. Majority of the export is Canvas shoes under leading
private labels to customers in the United Kingdom and France.
Men's leather shoes are sold to established retailers in Europe, MiddleEast and Far-East.
BIL's most modern leather shoe Factory is located in Hosur (Tamilnadu)
and is geared to make international quality footwear for export. This
Factory is comparable to the best anywhere in the world with high

degree of flexibility and is fully equipped to manufacture Men's, Ladies'

and Children's cemented and Moccasin shoes and other footwear.
future directions for the brand
Bata is on an aggressive expansion drive. The company wants to move
to large format stores, 50-percent of which will be set up in malls. In an
effort to draw a younger clientele, Bata also plans to add 20-30 'foot-in'
stores every year from 2014.
Bata board is considering a proposal to start franchisee operations this
year in smaller cities where setting up company-owned outlets may not
be viable. Meanwhile, its online sales are growing at 200% year on
year.
And to keep up their current 15- 20-percent growth momentum, Bata
will also invest Rs 80 crore this year, largely on modernizing and
increasing production at their 3 factories in Kolkata, Bangalore and
Pune.
Indian Finance Minister Arun Jaitley has announced in the Union Budget
2014-15 a cut
in the excise duty on footwear from 12 percent to 6 percent as a result
of which a 10 percent surge in footwear stocks has been listed on BSE.
According to Rajeev Gopalakrishnan, managing director, Bata India Ltd,
the middle class and lower middle class, who make up close to 70% of
the market, buy shoes below Rs.1,000 a pair; nearly half of this
segment buys shoes between Rs.500-Rs.1,000 a pair. Hence Bata is
continued to focus on improvement in customer service, addition of
new

products

ranges,

training

of

employees,

consolidation

of

manufacturing processes and restructuring of non-retail sales division.

Bata has also rolled out new plans to connect with the youth of the
country. It rolled out its first commercial in years on March 14, 2014.
This way the brand could to reach out to consumers, highlight its
offerings and build a fresh connection with the youth.

The brief is to contemporize the brand, showcase its aspirational and

trendy products and reach the evolving consumer; all centered around
its Spring Summer' 14 collection. With a peppy jingle, youthful imagery
of flirtatious footsies and visuals full of colour and life the plan is to
attract eyeballs.
Always ahead in new designs, new features, new products. A relentless
search will continue for better quality and pursuit of excellence. Bata
aims to provide new shoes for its customers at every step of their lives,
every week.
Bata will remain a household name to the people of India. Making
footwear for the family with a chain of ultra-modern retail outlets all
around the country and bringing in new trends and designs to suit the
needs of the trendy and the traditional. Today, Bata has repositioned
itself as a marketing-driven company with emphasis on quality service
and production.
MARKET SEGMENTATION:
INDIA A (14%, includes high disposable income group)
INDIA B (50%, includes people middle class and middle class group)
INDIA C (36%, lower income class group)
DEMOGRAPHIC SEGMENTATION:
Findings: The target market for Bata is all the class of the society i.e.
lowers, middle and the upper. Though, Bata is minimizing itself in
selling footwear to lower segment, as Chinese products have taken
over the market completely. The in-house brands make it possible for
Bata to cater to its upper and middle class segment. Bata cater to the
needs of male, female and children in equal proportion. The school
shoes which Bata sells are most prominent and sell the most. All Bata
stores reflect the new ideology like selling premium brands like hush
puppies and Marie Clarie etc. As for now, ladies' shoes is the main
revenue earner, contributing 30% to the company's revenue, followed

by men's shoes, children's shoes, school shoes and sports shoes. The
stores offer fresh collections and are visually stimulating. Thus we can
say presently their target customer base is the entire market segment.
GEOGRAPHIC SEGMENTATION:
Findings: Bata products are made keeping in mind people & their
choices from different parts of India as it has positioned itself as a truly
Indian footwear brand which caters the needs of all Indians all across
the country. Bata is present across the country through more than
1200 stores. It has successfully placed itself as an Indian product.
Stores are well available throughout the country. It sells footwear
according to the season as well. They have specialized shoes for
monsoon, summer, winter etc. Bata stores are spread throughout the
country. This means Bata is a product for all Indian.
PSCHYCOGRAPHIC SEGMENTATION:
1.

Batas target group includes all the three sections of the

society. They like the brand because its aptly priced and has

got a variety of products under its name.

2. Bata offers quality products at reasonable rate, which makes
it a clear favorite among the mass.
3. Shoes
for
all
seasons,
age

groups

and

gender.

COMPETITION
Leading competitors are Lakhani Shoes, Liberty Shoes, Action
Shoes, Woodland, Paragon and Relaxo in organized sectors.
UNORGANIZED SECTORS: it has to face a major competition
from Chinese footwear market which is imported from china
.because Chinese footwear entered Indian market , Bata has to
change its policy and also had to face major financial loss. Which
also led to fall of Batas market share to 10%.which was a major

setback for Bata India. Bata then stopped concentrating on lower

segment (in which Chinese had an edge: low price) which led
Bata to concentrate on other segments like on premium brands
also.
Bata faces the most competition from the ladies footwear
division

and

that

too

from

the

local

unorganized

shoe

manufacturers and Chinese shoe makers.

5.

Strategies Adopted over time by the Brand to tackle

Competition or Prime Market expansion Bata above the others

If analyzed for the value that Bata was providing to its customers
their value proposition may be categorized as follows.

Reasonable quality at low or reasonable price.

Footwear for the entire family.
Footwear catering to various functional needs e.g. sports, casual

footwear, formal-semi formal.

Conveniently accessible outlets in various parts of the country.
Prior to entry of local players and the Chinese imports, some sort
of social visibility could also be associated with Bata, as it was
one of the two major brands in the country then.
Bata has a sizeable brand advantage and a presence across

price points, but faces competition from imports and the unorganised
sector.
COMPETITIVE ADVANTAGE ABOVE THE OTHER BRANDS:
MANUFACTURING
Bata is dwelling on its international presence which is its
competitive edge and importing its best practices from abroad to
be able to handle the manufacturing requirements for slightly
trendier lines with lesser volumes. It is also utilizing its regional
expertise e.g. in Malaysia for rubber based shoes and in China for
artificial leather shoes.

CUSTOMER
The customer value proposition is substantial as Bata offers
value for money along with the trust which its customers have
because of the established Bata brand. In terms of access,
functionality and selection options it always fulfils its promises of
being a family outlet where each member of the family can buy
something. The service standards is strictly monitored and hence
an experience fit will be provided to the customers and these
customers for this will be willing to pay a bit of premium because
of Batas brand and hence the competition undercutting Bata on
price would no longer be that big a threat.
INTERNAL PROCESS
As far as the internal aspects of the firm are concerned Bata is
restoring

its

operations

management

processes,

customer

management processes, innovation processes and regulatory

and

social

processes.

Modifications

in

the Operations

management processes will allow Bata to have low cost to an

extent, through economies of scale attained through specialist
regions worldwide supplying the products, as import duties would
no longer be a barrier, and other stable high volume products
being manufactured locally at the Bata plants.
LEARNING AND GROWTH
In order to attain its goals as per the new strategies Bata is
consistently putting in quite a lot of effort into training its human
resource, especially those at the outlets to provide consistent quality
service to its customers so that customers can associate the same
experience with which ever outlet they visit of Bata. A culture of
empowerment is fostered and younger energetic managers are being
appointed given the responsibilities so that they may fill in any
leadership void, if created. However overall longer leadership stints for
top executives e.g. CEOs would be needed to allow them to take the

company towards its goals by implementing the strategy. With these

changes in place, Bata would be in a better position to cope with the
various challenges posed to it, by its competitors.
The company has a three-pronged strategy; setting up 60 largeformat stores every year (minimum area of 3,000 sq ft), closing
down the unviable ones and increasing its focus on institutional
business.
FOCUS ON PRODUCT DESIGN: creating contemporary look for the
product which can be found in almost every retail store and in every
occasion, introducing new offerings for men, ladies, sports personnel
and children.
Initiation of regular customer feedback process, customer
research, training of staff, multi pronged sourcing strategy to reach
faster, procure faster and more economically, Consolidation of
manufacturing operations, restructuring of wholesale division into four
independent distribution channels: urban and institutional, safety,
branding segment for more impact and better sales. The stores
operate in a four-tier retail format under a new model -- upmarket
flagship stores, smart and trendy city stores, super stores and
traditional family stores. This helps the company service its customers
better in places where currently it does not have presence. "The largeformat stores are mostly franchise-run. The new-design store interiors
itself cost the company around Rs 2 core per store," Bata chairman P M
Sinha says.

These new stores have helped Bata to bring its

contemporary and trendy range of footwear sold in an international

style outlet to customers even in small towns.
The company has already set up a dedicated team headed by a
retired defence man to secure contracts. The total market size for
footwear used by the defence personnel is about 12 million pairs a
year. "The country has roughly three million defence and paramilitary
personnel and each buys four pair of shoes per year, totalling 12

million pairs a year. That's a big market," Sinha says. Defence

authorities currently source most of its footwear requirement from
unorganised players.
Bata was considered as manufacturing oriented company who
concentrate on producing footwear and sell them in market at
anyhow. Bata wanted to change this image of production-oriented
company to affordable, market driven, fashion conscious, lifestyle
brand that is why Bata wanted to reposition itself.
Bata is trying to move out of the image of an age old seller of their
manufactured goods. They are now concentrating on products that
the customer wants rather than products that they produce.
Bata India is in a complete process to change from its earlier image.
Bata Was considered as manufacturing oriented company who
concentrated on producing footwear and sell them in market at
anyhow. It wanted to change its image from a manufacturing company
to a marketing company. Bata wanted to change this image of
production-oriented company to affordable, market driven, fashion
conscious, lifestyle brand. They are focusing on a better brand recall by
opening

bigger

stores

in

malls

etc.

It has revamped its stores to look more contemporary, shedding

its age old image. The company has decided to be more visible in
shopping malls, open up to the franchisee model and also create the
shop-in-shop experience in a multi-branded store. A step towards
rejuvenating the Bata brand, the company is repositioning itself as a
market driven, fashion conscious lifestyle brand with an emphasis on
service and production. The company recently introduced international
styles and trends for women, men and kids, which have gone a long
way in providing a trendy and contemporary image to the company.
Revamping its marketing operations, Bata India has introduced the

concepts Flagship, City, Family and Bazaar stores that cater to different
segments of the market. Further, to capture the retail boom prevailing
in the country, the company has decided to move its headquarters to
Gurgaon this year. They are also intending to make the shopping
experience better to their customers by employing skilled salesperson
& creating a better ambience.
Merchandise Overhaul
Bata decided not to sell any low profile products. They literally threw
out its entire low-margin inventory in 2005. It has fixed certain
operating margin below which it would not sell any products.
It formed a team of 100 professionals for product design, procurement
and merchandising. They roll out new designs North Star, Marie Claire,
Bubblegummers,

Hush

Puppies,

Wellinbrenner,

ambassador,

Mocassino, Power and comfit such as for every 15 days. They will also
meet

their

counterparts

in

Europe

every

quarter

to

improve

international designs.
Bata customizes its design to the local market. For example Indian
women prefer small-sized heels and demand for closed shoes is
gradually increasing.
Bata plans to launch four designs everyday and open 70 to 100 stores
of atleast 5,000 sq ft every year to shed its image as cheap footwear.
Bata opens 20 to 30 single brand stores every year either standalone
or in malls like Lifestyle and Central. It plans to deal brand licensing
with global players to widen its portfolio.
Bata changed its sourcing strategy too. It plans to make all five plants
in the country that is a specialist for a particular type of footwear. It

also plans to source from China and domestic third parties for cost
efficiency by cutting its human force by voluntary retirement schemes.
Scale game
The new avatar of Bata is all about quality, contemporary design and
customer-centricity.

It is also a brand of loyalty and repeated sales

unlike its competitors known for luxury or show-off or flaunt.

This

would definitely help the brand grow.

For the competitors it is difficult to meet the scale of operations of Bata
and in the same way for Bata it is difficult to establish itself like sports
wear or a luxury brand like Adidas, Reebok, Nike, Lee Cooper,
Woodland and Puma. Infact these companies do no consider Bata as a
competitor to them as it is mainly into utility or value-for-money
market because of which it is making volumes.
Not stopping with that, Bata continues to open new stores every year
with an average size of 3,000 sq ft and renovates the existing stores.
On an average, Bata opens over 60 new stores in a year. The focus is
on growing its retail business. The new stores are designed by a team
of specialists and architects from Italy to be best in their class. The
layout of these stores are designed to suit the convenience display of
the products with modern furniture and well-lit ambience supported by
attractive POP enabling the customers to make better choice in
convenience.
The store staff is also given training for good customer response and
customer relations.

It employs more than 6,800 people to serve

120,000 customers daily. It has 5 manufacturing facilities across the

country and sells over 45 million pairs of footwear every year.

The

manufacturing set ups are fully equipped with tannery enabling them

to cater wide range of customer segments across the country. They

focus better quality products with the help of better technology for
more trendy looks and to meet ever-changing market requirements.
The product development department focuses on improving products
with latest softwares and IT systems. The new products are lightweight
rippled flexible soles, soft leather uppers with full padding which are
best sellers in their category. The school shoes are also upgraded from
a solid PVC sole to air blown lightweight sole with good cushioning for
better support and comfort for children. The company always focuses
on quality, which made them granted approval by DGMS after meeting
their strict Specifications. The Batanagar unit is equipped with Quality
Control

cum

Research

and

Development

Laboratory,

which

is

accredited, by Ministry of Science & Technology, Govt. of India, Bureau

of Indian Standard, FDDI and Directorate General of Mines Safety.
Bata Company has a specialized division within the company.

They

focus on industrial and institutional business. They have highly trained

professionals and large distribution network to their credit.
It is worthy to look at the wards the company got with their team and
expertise.
Achievements
I.

Bata India was awarded the Most Admired Large Format MultiBrand Footwear Retailer of the Year award.

II.

Customer Loyalty award by Shoes & Accessories and the loyalty

award for a wide product range and excellent customer service.

III.

Brand Equity, acknowledged Bata to be amongst the 50 Most

Trusted Brands

in a 2010 study.

I.

In its history the Bata has sold more than 14 billion pairs of shoes
and was awarded the Guinness World Record as the "Largest
Shoe Retailer and Manufacturer".

II.

Brand Of The Year Award

III.

Bata have won the brand of the year award for 2009 and 2010
because it has been serving to the needs and demands of a wide
array of customer.

Bata won the award in following categories:

Power
Marie Claire
Bubble gummers
1.

Awarded Amity Corporate Excellence Award 2009 in a

ceremony held in Amity Business School, NOIDA on February 27 th 2009.

Bata received the award for the third time.
2. Business Week lists Bata India in list of The worlds 25
Unsung Innovative Companies in its May 2009 issue. The report
was compiled by Boston Consulting Group, Business Weeks partner in
Annual Most Innovative Companies Special.
3. Awarded Outstanding Sales performance for Year 2008 for
Hush Puppies by Wolverine Group- Announced in May 2009 in
Michigan
4. Brand Equity recognized Bata in the TOP 50 Most Trusted
Brands in June 2009. Bata is the only lifestyle retailer in the top 50
brands.

5. Bata India awarded the prestigious Images award of the

year for the Most Admired Retailer of the Year Fashion &
Lifestyle in Mumbai on September 16, 2009.Other nominees in the
category were Levis, Benetton, Wills Lifestyle, Bata, Louis Phillipe and
Titan
6. Bata India awarded the Most Admired Footwear Brand by
Images Fashion Forum in 2009, the ceremony was held in Mumbai
on January 28, 2009
7. Bata India received the Amity HR Excellence Award for
Corporate Ethics on 28th August 2009 in a ceremony held at Amity
Business School, NOIDA.
8.

Bata

India

is

selected

as

POWERBRAND

in

the

POWERBRANDS 2010. The selection is done after an extensive pan

India research conducted by Indian Council for Marketing Research to
select The Most Powerful Brands in India in the year 2009.
Suggestions
Future Directions for Brand
Company should focus more on Product and Market Development and
Market penetration Strategies.
More attention should be given to the middle and upper middle class of
the society, because increasing number of people belonging to these
segments and also because of their rising incomes.
Renewed brand image will help Bata to attract upper middle end of the
market and will raise the higher income.
As footwear industry is highly fashionable industry; Bata must
concentrate on bringing new designs and styles.
The service standards should be strictly monitored and hence an
experience fit will be provided to the customers and these customers

for this will be willing to pay a bit of premium because of Batas brand
and hence the competition undercutting Bata on price would no longer
be that big a threat.
It will need to focus on marketing itself as an outlet meeting all basic
needs of the families in its target market segment
Should provide consistent quality service to its customers so that
customers can associate the same experience with whichever outlet
they visit of Bata.
Internet is a broad medium so they should also improve e-business.
The

company

should

focus

on

Product

Development,

Market

Development and Market penetration strategies.

It should concentrate more on the middle class and upper middle class
people as their number and income are growing.
The brand image should be renewed to gain a premium in the upper
middle market.
Bata should launch new design and styles to gain more financial
benefits.
The service standards should be enhanced so that the customers
should feel the difference with the other brands.
It can also meet the other needs of the customers like entering into
accessories division.
The service at all the Bata stores should be consistent so that the
customers should feel the same whichever store they visit to.
The debt equity ratio is 3.51, which means almost 75% are debts. This
can be reduced to avoid financial charges.

The Selling and Administration expenses also can be reduced to

increase the net income.
E-business can be encouraged to cater a large base of customers.
Conclusion:
The company has already started reworking for recapturing its original
market share and its previous customers who have turned towards
other brands.

But it is a long way to change the perception of the

customers who recollects a ration shop or sandals when they hear the
name Bata. Bata has to shed the image of its utility products to create
a brand image for middle and upper middle class people. But with its
team and the leader it believes NOHING IS IMPOSSIBLE.
References:
Business Line, December 22, 2006
The Economic Times, May 10, 2006
The Economic Times, May 30, 2011
The Economic Times, May 11, 2011
The Hindu Business Line, May 11, 2011
The Economic Times, May 10, 2011
The Hindu Business Line Apr 29, 2011
www.bataindustrials.in

http://www.hindustanstudies.com/files/marketmanage.pdf
http://www.wikinvest.com/stock/Bata_India_%28NSE:BATAINDIA%29
http://articles.economictimes.indiatimes.com/2010-0224/news/28480241_1_egaro-footwear-km-khadim
http://www.bata.com/us/news/news/news.php?id=634
http://www.bata.in/webbata/faces/jsp/static.jsp?
articleid=1897&orgId=0&lang=en
http://www.bata.in/webbata/faces/jsp/static.jsp?
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http://www.bata.in/webbata/faces/jsp/static.jsp?articleid=1954