With the Indian economy revving up and consumer spending picking up like never before, branded men's shirt is one of the segments that has been showing immense activity the past few years.
A heavy advertising spend, a number of new players like Provogue and the increasingly fashion-conscious Indian male have marked the new characteristics of the branded men's shirts segment.
Arvind Brands' Arrow has been one of the earliest and well-established players in the branded men's shirt.
After lying low for the last two years, Arrow is now back with a vengeance planning more stores, newer lines and firming up its expansion plans.
Darshan Mehta, president, Arvind Brands Limited, a Lalbhai Group company, is at the helm of these changes.
In 2001, he was given the responsibility to head Arvind Brands, which manufactures and retails brands like Arrow, Lee, Wrangler, Excalibur, among others.
Earlier in 1998, Mehta handled the merger of Anagram Finance Limited (a Lalbhai Group Company) with ICICI.
In an interview with Priya Ganapati, he talks about his plans for Arrow.
How big, in your estimate, is the size of the branded apparel segment in India and what is your share of the market?
You have to realise that this is an industry with no visibility of data in an organised sense. So the figures I quote are more of industry estimates rather than of any organised research. The apparel segment on a whole is estimated to be Rs 40,000 crores (Rs 400 billion) and of that the branded apparel segment is estimated to be Rs 9,000 crores (Rs 90 billion).
Now what would you say is branded apparel? Anyone can make a shirt and put a label on it. But when we say branded apparel, we would like to believe in brands that are available nationwide.
So in that sense, the nationally available branded apparel market is estimated to be at Rs 3,000 crores (Rs 30 billion) and we have about 12.5-13 per cent of it.
With Arrow, who is your target audience and how have you positioned the brand?
The core audience for Arrow is the 27-35 year age group. They are the slightly older group. We aren't looking at teenagers. Our target audience has had about five years of working life, is predominantly male -- I say that because a number of women buy Arrow to gift to their husband or father -- and is affluent.
Arrow has always been a gentleman's outfitter. We put the 'established in 1851' as our tag line. There are not too many brands that are over a hundred years old yet are still robust, fashion forward and have high energy. We think Arrow signifies good pedigree, parentage and high degree of contemporariness, which is reflected in the cuts, fabrics and silhouettes.
Arrow has been fairly quiet in the last two-three years. Even as your contemporaries advertised strongly, you kept a low profile. Why?
During 2001 and the first half of 2002 overall it was not a very good time for the apparel industry. Post the dot com bust and the slowdown in the economic growth the market was a little depressed. Also there were factors like the imposition of excise duty, which wasn't there before. From zero excise duty on branded apparel it went up to 16 per cent. Now it has been reduced to 10 per cent.
There were a lot of challenges but now the industry is picking up. We grew last year at 20 per cent. This year we expect the growth rate to be at 35 per cent. Both these are at twice the industry standard.
We have also done a bit of restructuring in the way we handle our brands. This is not just for Arrow, but also for our other brands like Lee, Wrangler, Excalibur etc.
Each brand has its own consumer base, target audience and challenges. What we have done now is ensure that each brand has a business head who is like the CEO of the brand.
So he can have the dynamism to react to changes in the marketplace. Earlier it wasn't that way. We were a more silo organisation, more hub and spoke. Now we are a matrix organisation, completely flat. From the peon to me, today there are only four levels.
What about your retail strategy for Arrow?
We have three prime channels of distribution: free standing stores, department store channel and multi-brand outlets.
We have about 50 freestanding stores and we just opened a new one in Mumbai, which marks ten years of the Arrow brand in India.
We have 11 more stores under construction and we will be investing Rs 15 crores (Rs 150 million) in that. The 'malling' of India is also an important development. 
In the next two-three years around 310 malls are expected to come up which is an unprecedented development. It is a unique phase in the urban India retailing landscape. We have to watch out for customer footfalls. We are living in a very fluid and fast changing scenario and we need to keep up with it. All the 310 malls might not do very well but we will have to have a presence in all the key malls.
So how are you looking to expand the Arrow brand?
In Arrow we had only shirts initially. Now we have segmented the brand into four categories: Classic, Premium, Urban and Sport. We also have Arrow Knitwear. What we are planning is Arrow Denimwear, for the older and more affluent customer who has the purchasing power, is well groomed and who is looking to wear jeans.
Brands like Lee and Wrangler are aimed at the customer in the 17-25 years age group. They have the unwashed, faded look. But the older customer is looking for different things from denim. His body shape is also different so Arrow now wants to make jeans for them.
We also are looking at expanding the Arrow range of accessories. We have belts, wallets, socks, ties and cufflinks. But we are looking at newer sub categories that we can license the Arrow brand to. Footwear is one. Fragrance is another. We are also exploring the possibility of watches and undergarments.
Are you looking at introducing any new brand?
We have tied up with the Murjani Group to launch Tommy Hilfilger in India. We are awaiting the last of our statutory approvals, which should happen in the next ten days. It is a joint venture and we hope to launch the product by spring/summer 2004.
More from rediff