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STRATEGY Lakmé Restages Its Opera Its turnaround sketch has got just a few strokes - grab the fashion platform, spruce up the supply-chain, and test the rural waters. By Shamni Pande
High priestess of sacred Indian temple meets English army officer who's unwittingly strayed into holy ground. They fall in love. Her orthodox father vows vengeance... That's the story of Lakmé, a 19th century opera written by Frenchman Leo Delibes, from which Simone Tata borrowed the name Lakmé (French for Lakshmi, the name of the priestess). By 1999, the world looked set for a revised version of the work. Simone Tata was no longer on the scene. And a home-grown fashion brand-often personified as the high priestess of fashion in the country-had been sold to a multinational company whose provenance was English, well, Anglo-Dutch, actually-Hindustan Lever Ltd (HLL). Worse, with HLL not appearing too keen about the brand-the company, predictably, denies this-Lakmé, the brand looked all set to follow the spirit of Lakmé the opera (a tragedy). Lever was right. The aria, as is now evident, wasn't quite over. Standing amidst the jamboree of what is, arguably, India's first fashion summit, the Lakmé India Fashion Week (LIFW for short), Anil Chopra, 51, the affable Director who heads Lakmé Lever Ltd is bullish about the brand's new positioning: ''By taking on the fashion and glamour platform, we have, in a way, not just taken a lead (over others), but also got a virtual ownership of this plank. It will be very difficult for any other brand to adopt a similar approach.'' And reactions to the born-again Lakmé at the LIFW did suggest that Chopra and the brand were on to a good thing. ''Lakmé is at the forefront of product-innovation. Almost everyone has a Lakmé-something in their (cosmetics) collection,'' gushes Mumbai-based fashion choreographer Lubna Adams. So, is Lakmé back? Getting the focus right A little bit of Lakmé history: in 1995, Lakmé Ltd (a Tata Group company) and HLL formed a 50:50 venture Lakmé Lever that would market and distribute Lakmé's products. In 1998, Lakmé sold its brands (and the 50 per cent it owned in the JV) to HLL, renamed itself Trent and entered a different business (retail). Only, the years between 1995 and 2000 saw HLL wrestling with several issues with a bearing on Lakmé's future. The FAQs: With Ponds becoming part of HLL, what happens to Lakmé's skincare business? What does Lever's launch of Aviance mean for Lakmé? And why is it so difficult to find Lakmé products? Chopra accepts that distribution has been the company's Achilles heel for some time: ''The supply-chain hasn't been as robust as it should have been, but that has been the result of our efforts to reposition and reintroduce the brand.'' The positioning bit, although complex, is clear: Ponds is Lever's primary skincare brand; Lakmé, its aspirational colour cosmetics brand, which also has a presence in skincare. The 'aspirational' qualification would mean Lakmé would compete at what the company terms the 'upper-mass' (premium) end of the colour cosmetics spectrum (products priced between Rs 85 and Rs 250) where a slew of competitors, ranging from Revlon (through Modi Revlon) to Chambor, are already slugging it out. Says Meghna Modi, 26, Executive Director, Modi Revlon: ''The numbers say it all. According to ORG-MARG's retail audit, we have an 84 per cent share of the premium end of the colour cosmetics market.'' Chopra is quick to rubbish this claim; he says ORG-MARG does not have a representative sample of the 60,000 outlets through which colour cosmetics are sold in India. Still, it is conceivable that Lakmé's new-found aspirational strategy could have been brought about by competitors like Revlon and Maybelline, which targeted this segment. Indeed, the company's non-transfer lip-colour range follows in the wake of Maybelline's launch of a similar range, and its new nail-enamel colours come soon after Maybelline and Revlon launched their nail-enamel range. The company's defence is that it takes at least 15 months from the conceptualisation to the actual launch of products. And fashion consultants like Meher Castelino believe the brand commands an edge at the high-end: ''By appropriating the fashion platform for itself, Lakmé has entrenched itself at the glamour-end.'' Getting the spread right The premium segment, however, is just a slice of the Indian market for colour cosmetics (estimated size: Rs 275 crore). Today, the company has three brands: Lakmé itself, which will be positioned as a fashion-brand; Elle 18, which has enjoyed success as a college-girl brand; and Orchid, a super-premium brand that hasn't really seen much excitement since its 1999-relaunch. The company plans to re-re-launch Orchid by end-2000, and is test-marketing Elka, a brand targeted at the lowest-end of the colour cosmetics market. The brand, Chopra claims, could also catalyse Lakmé's entry into the hinterland, but only if tests show there is a rural market for colour cosmetics. Says Nikhil Vora, 28, Portfolio Advisor, Sharekhan.com: ''Though rural markets are big potential, a company has to think of segments carefully. Any expansion into new areas should be justified by returns.'' Lakmé will remain a loner in the Lever stable: Unilever does not have a presence in the colour cosmetics segment. That means Lakmé Lever will have to depend on its own kitchen garden. But a focused-most of its skincare business and all of its exports business have been taken on by HLL-Lakmé does seem to be on a come-back trail. It's still the second act, but this opera could well have a happy ending. |
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