Hidesign: Marketing Leather Products

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Case Details:

Case Code : MKTG146
Case Length : 16 Pages
Period : 1980-2006
Organization : Hidesign
Pub Date : 2006
Teaching Note :Not Available
Countries : Worldwide
Industry : Leather

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Hide and Design

The name Hidesign was formed by merging the words "hide" and "design" (Refer to Exhibit II for the Hidesign logo). And true to its name, Hidesign went on to become a premier design house for leather goods, gaining acceptance even in the highly competitive western markets.

Hidesign products were priced high and were aimed at the mass luxury market. The target market consisted of people aged between 20 and 50 years, belonging to high income households, who traveled frequently, often internationally; and insisted on high quality products.

Hidesign brand products used only full grain leather. The leather was tanned using the vegetable tanning process...

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Hidesign's Distribution Network

In its overseas markets, Hidesign graduated from a firm fulfilling export contracts to selling through distributors and then through high-fashion retail chains like Selfridges. In later years, it even started wholly-owned concept stores. On the other hand, in India, Hidesign started its distribution operations by opening wholly-owned stores (in 2000). This was followed by tie-ups with retail chains like Westside in 2003 and subsequently Shoppers' Stop, Landmark, etc. In late 2005, it announced plans to open exclusive franchised outlets (Refer Exhibit IV for worldwide presence of Hidesign)...

International Distribution

Initially, Hidesign was an exclusively export-oriented outfit, fulfilling orders from European and American distributors. It concentrated on taking small orders and fulfilling them to high quality standards and delivering on time. This proved crucial in building its reputation among high-end overseas customers and in gaining their initial goodwill.

In the early 1980s, Hidesign entered the UK through local distributors. However, initially, the leather and luggage shops in the UK were not keen on stocking an Indian brand. Since Kapur intended to sell high-fashion leather products, he had to prove his credentials. But the 'Made in India' tag didn't help. He said, "Yes, at first, people stopped and thought for a while..."

Domestic Distribution

Hidesign started its retail operations in India in 2000 when it opened its first wholly-owned exclusive retail outlet in Bangalore. The Indian market too proved receptive to the high quality leather goods of Hidesign and the business boomed. "Ever since we began retailing in India, we have registered a 60% annual growth every year," said Kapur.

Hidesign went in for a major expansion in India in 2002-2003. The fact that the global market for luxury goods was facing a slowdown while the Indian fashion market was buoyant and that there were no major competitors in the same category, prompted Hidesign to exploit the huge opportunity. As Kapur said, "In India, we have two distinct advantages. One, our economy is still growing at 6% and two, there is no competition in leather at the top end of the market. So we are filling up a vacuum..."

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