"Buzz's idea of having one set of products to cater to the brand-conscious consumer and another to garner the volumes is an apt one" C. Srinivasan, General Manager (Sales), Titan Industries

Is convergence the way forward for buzz? At the crossroads it finds itself at, the real questions confronting Buzz are: Which are the consumer segments that have significant potential for growth? How should Buzz be positioned to excite these consumers? Is convergence the answer?

Technology is a plank used by brands in other product categories such as mobile phones and entertainment where the consumer demands new features and functions as well as enhanced performance. Looking at different consumer segments in India, technology holds the greatest appeal for 15-30 year olds for whom being the first with the latest in gizmos is really 'cool'.

Buzz, with its global research and development capabilities, certainly appears to have the resources to support such a positioning and seems to be on track towards attaining that objective.

However, for this strategy to result in significant volumes, products and communication have to cut across consumers and not excite just a select few.

On this front, Buzz has not been able to make its watches popular enough to be able to garner volumes. The new marketing chief Anand's suggestion on focusing communication on one set of products that sell the brand and the remaining larger set that sell volumes is apt. Buzz needs to target a wider set of consumers and launch a suitable range of products that have an edge over its former ally.

On another front, Buzz does not seem to have been able to suitably 'layer' the brand to stand for more than just technology. The suggestion made by Anand's deputy here is valid, since to compete in the youth space, you need to be seen as 'cool' and 'happening'. So portraying technology as an enabler of the modern image (and including aspirational 'user imagery') needs to be considered to enhance the brand's mass appeal.

With the benefit of hindsight, the decision to suddenly change Buzz's positioning from a mass-market durable brand to a technologically-differentiated, urbane brand appears to be a fundamental mistake on part of the watchmaker.

Building a brand in India is a long and arduous task and requires a lot of time and money. It is also not easy to change consumer perceptions in the Indian market about a product without making significant investments. As the brand was already endowed with mass-market appeal, Buzz would have achieved better results if it had been pragmatic enough to continue with the same brand positioning, while making marginal changes such as adding specific technology collections aimed at the yuppie segment.

Convergence does hold out the promise of smart devices that provide personalised information and functions that go beyond the conventional uses. It is now widely accepted that watches of the future will go beyond merely telling the time and display personalised information from the Web such as messages, calendar updates, customised news, weather, financial and sports information. The cost of such products is also likely to place them out of the reach of most customers, at least in the near future.

Buzz needs to decide whether it wants to be profitable by growing volumes or through carving out profitable niches. The former would be more prudent, given Buzz's current business model and the market realities.

Further, banking on 'convergence' will restrict Buzz's reach and make it relevant only to tech buffs who are willing to pay higher prices. This approach will also pit Buzz's offerings against other products like personal digital assistants (PDAs) and 3g mobile phones.

"Buzz should focus on offering affordable technology-centric products that are both durable and cool to attract the consumers and keep them hooked" Harbinder S. Purewal, Managing Director, PA Times Industries

Buzz's convergence-driven product strategy makes sense only so far it is restricted to market positioning and consumer perception. This approach, however, breaks down when it comes to ensuring profitability. There is the market reality to consider. The Indian market is not large enough at the upper end to give decent volumes to a watchmaker offering such expensive, high-tech products. Even if 'digital economics' works out to give Buzz's brands some sort of cost advantage, the difference to the company's bottomline would be felt only after a long period of time.

The other fact that stands out is that the brand's linkage with a 'hi-tech' image is very strong in the mind of the consumer. As the discussion of the senior management team made evident, a good deal of the company's resources have been spent to establish this position of leadership, and it would be foolish to walk away from it.

So it is a good idea to be associated with Micron and jointly develop 'convergence' products. However, Buzz must ensure that these products are affordable enough for it to be able to attain the volumes needed to turn in a healthy profit. A strategy that is not only centred around technology but volumes as well seems best suited to Buzz. Utilising its plant capacity to the fullest will go a long way in helping the company achieve this.

The company needs to bear in mind the phase of the learning curve that its targeted consumer segment is at. The typical young, urban consumer wants to be fashionable and live life for the moment. Consumers in this category also have a strong yearning to make a statement amongst their peers, particularly when it comes to watches, which are a highly visible part of their get-up. Competing for attention in this product space are also the cheap, but fashionable grey market watches.

To attract and keep such consumers hooked, Buzz should offer affordable 'tech-centric' products that are durable and cool.

"Buzz should rethink its volumes strategy and confine its products only to the medium and high-end categories to enhance the fashion appeal of the brand" Gopalratnam Kannan, Country Manager, Swatch Group India

In its quest to emerge as a volumes player in the Indian market, Buzz made the mistake of trying to straddle all the price segments, including the lower price-range, and ran into stiff competition from the more established Indian players. The watchmaker's initial attempts to piggyback on a domestic player to acquire the distribution reach that it desired only served to complicate matters further. It did not sufficiently differentiate its brand from the umbrella brand, eventually resulting in its local alliance coming apart.

Buzz now needs to undertake a serious brand re-positioning exercise. To begin with, it needs to rethink its volume-player strategy. A watch is primarily a fashion product. The buyer perceives it as a symbol of his or her persona. It is, in fact, as much an extension of a buyer's personality as his clothing, hairstyle or other accessories. Simply or solely playing the volumes game in this product category wouldn't pay for a company like Buzz. It dilutes the appeal of the product.

To enhance the fashion appeal of its products, Buzz should gradually phase out its low-end products and focus only on the medium and high-end.

This would require two major steps. One, the company would need to narrow down the price band within which its products will be available. Two, it would need to adopt a more focused distribution approach by reducing the number of points of sale (pos) and the total number of cities the brand is present in. It is not feasible for a brand like Buzz to be present in the small towns. It should, instead, focus on the fashion-conscious consumer by limiting its presence only to the metros and larger towns.

When you concentrate on the fashion aspect, the game changes completely. By streamlining distribution, the costs involved in logistics and communication would automatically come down, allowing Buzz to concentrate its resources on its major markets and to reap greater returns for its marketing money. Narrowing the price band would also help enhance the company's image as a niche player in the medium and high-end watch market.

To establish a bond with the consumer, the company needs to adopt a unique positioning platform, on which it should then build its entire communication-be it advertising, in-store promotion or customer relations. Convergence, in my opinion, is a very narrow platform. Technology can be a salient feature, but not the main theme for the brand's promotional campaign.

The main theme needs to be one that portrays the brand's core values and one that remains relevant to the brand's existence throughout its life. The salient feature of its products could be technology, but the main theme of the brand should remain the same.

Buzz should go in for a brand-positioning based on youth, style and fashion. No watch company can ignore this. Buzz should leverage its American lineage and establish itself as an innovative and flamboyant brand. This will help it acquire a positioning distinct from those of other watch brands.

"Buzz's idea of having one set of products to cater to the brand-conscious consumer and another to garner the volumes is an apt one"

"Buzz should focus on offering affordable technology-centric products that are both durable and cool to attract the consumers and keep them hooked"

"Buzz should rethink its volumes strategy and confine its products only to the medium and high-end categories to enhance the fashion appeal of the brand"