Clubb

International:
Revisiting the
Market Strategy

Anmol Saxena G23065

K Murali Krishna G23078
Nishit Kumar G23087
Pramod Reddy G23090
Shamrath A G23103
Clubb International: Revisiting the Market Strategy
CLUBB INTERNATIONAL: REVISITING THE MARKET STRATEGY
Marketing Strategy

CASE OBJECTIVE
The objective of the case is to present the macro situation of the travel goods and accessories market
and to map how a particular player’s perspective aligns with the changes in the industry to analyze
how the particular player determines his goals and aspirations with respect to its position.

PROBLEM STATEMENT

Clubb's challenge is to establish itself in the domestic mid-range market and expand globally, while
remaining profitable and meeting customer demands. The company also delved for strategies to
increase market share domestically, effective penetration of new markets, ensuring manufacturing
quality without compromising margin, overcoming advertising challenges, and differentiating from
competitors.
Few of the Sub questions of the Problem Statement are as follows:
 How can Clubb differentiate itself from established international and domestic competitors in
the market?
 How can Clubb effectively communicate its brand and products to target customers without
relying on traditional advertising and media vehicles?
 How can Clubb leverage online platforms to reach customers in areas where it lacks physical
dealers?
 How can Clubb align its product offerings with the varying tastes and preferences of
customers in different states and regions of India?

CLUBB - NEEDS & SOLUTIONS FOR OFFERINGS AND ALTERNATIVES

The need in the market is for travel and accessories luggage that caters to changing consumer
demographics, emphasizes style and fashion, and provides visible status symbols.
To cater to the needs, Clubb offered a range of travel accessories and bags that met the aesthetic and
functional requirements of modern Indian consumers/customers. Clubb strived to deliver customers
with top-notch products, continuously amazed them with fresh offerings, and ensured their utmost
satisfaction through exceptional customer service. Clubb aimed to appeal to the younger generation
and the upper middle-class segment. They also leveraged e-platforms and targeted smaller towns and
cities to expand their reach.
The various alternatives available to the Customers of Clubb International are VIP Industries, Safari,
wildcraft, Hidesign, Titan Fastrack, American Tourister, and Skybag. There were also products of
cheap, synthetic luggage from Chinese, Taiwanese, and Vietnamese manufacturers.

VALUE CREATION FOR BUSINESS MODEL

1. To the Organization:
a. Generated revenue of Clubb International has been sustained and consistently increased
over the years, showcasing the effectiveness of its business model.
b. Clubb International has effectively protected its margins by eliminating distributors from
its business model.

Clubb International: Revisiting the Market Strategy

CLUBB INTERNATIONAL: REVISITING THE MARKET STRATEGY
Marketing Strategy

c. Accessed customer segments by collaborating with distributors in the beginning, Clubb

International effectively reached diverse customer segments. These collaborations
allowed the organization to tap into established distribution networks, gain access to
dealers.
d. Received funding from UNDP, Clubb International has been able to build sustainable
products by venturing into jute and leather mixed products. This funding support has
enabled the organization to develop and offer jute-based products, aligning with
sustainability goals.
e. Clubb successfully expanded its product portfolio and seized market opportunities by
introducing products like PVC raincoats, demonstrating the flexibility and adaptability of
its business model.
2. To the Customers:
a. By providing products at affordable rates (at price point 15% lower than the market
leader), the business model ensures that customers from these segments have the
opportunity to travel and enjoy stylish products without compromising on quality or
breaking their budget.
b. The demand and supply of Clubb International's products continue to grow, and the
business model is designed to meet this increasing demand while maintaining a steady
supply of high-quality products in the market. e.g., Making cabin baggage lighter.
c. By establishing an online presence since 2012, Clubb International's business model has
significantly increased access and ease of availability for its customers.
3. To the Stakeholders:
a. Internal Stake holder: Enables the organization to provide job satisfaction to its
employees by involving them in every aspect of the business and fostering creativity.
b. External stake holders:
i. Ensured that dealers receive higher margins compared to market leaders.
ii. Retained dealers based on their historical performance and the customer base they
serve. This approach recognizes the contribution and efforts of dealers who have
demonstrated success and customer satisfaction
iii. Align with the interests of environmentalists and governments by reducing
reliance on leather and diversifying into sustainable materials. This environmental
conscious approach contributes to the healthy growth of the sector.

STRATEGIC CONTEXT ANALYSIS

Clubb International’s Strategic context were as follows:

1. Resource and Capabilities: Clubb started its journey with Mullick and a single employee,
but by January 2017, the company had grown to have 100 direct and indirect employees.
Some of these employees had been with Clubb since its early days, including Mullick's wife
and son. Clubb utilized a variety of raw materials for its products, including leather, plastic,
nylon, polyester, textiles, corduroy, and jute. These materials were used to create the diverse
range of bags offered by the company. In terms of machinery, Clubb had a PVC high-
frequency welding machine. Additionally, the company also used a Taiwanese machine
specifically designed for bag production. These machines played a crucial role in the
manufacturing process of Clubb's bags. In terms of financial investment, Clubb started with a
meager amount of ₹10,000. This initial investment was secured as a loan, obtained at an
interest rate of 18%.
2. Target Customers: Clubb had a diverse customer base, including both national and
international customers. Their customers range from businesses purchasing corporate gifts to
Clubb International: Revisiting the Market Strategy
CLUBB INTERNATIONAL: REVISITING THE MARKET STRATEGY
Marketing Strategy

individual customers, both online and offline. The middle to upper-middle class in urban
areas, who seek quality products at affordable prices, form a significant portion of Clubb's
customer base. There was also a shift towards targeting younger customers, including
college-goers and younger students, who contribute to the company's revenue through the
purchase of bags and backpacks. Different regions and states in India have varying customer
preferences, and the online platform has helped regain customers in areas where physical
dealers were lacking.
3. Competitors: The travel and accessories luggage market were fiercely competitive, with
well-established national brands like Safari, VIP, Hidesign, and Titan Fastrack dominating
for over two decades. New brands like Wildcraft offered similar products, and affordable
luxury brands like Nappa Dori also entered the market. Despite the advantage of cheap labor
in India and China, Clubb faced tough competition from Vietnam and Cambodia.
4. The External Environment: The leather travel goods sector faced environmental concerns
over animal hide use, while exotic leather increased costs. Proactive players adopted new
technologies to tackle waste, and India relied on labor-intensive processes. On the other hand,
factors like rising income, working women, and travel demand from Tier 2 and 3 cities
boosted the sector. Also, government supported recognized leather's foreign exchange value,
shaping policies and incentives.

MARKETING STRATEGY DEVELOPMENT ACTIVITIES

The marketing strategy development activities are divided into three categories:
 Strategic Marketing Analysis
 Strategic Marketing Goals
 Strategic Marketing Actions.

STRATEGIC MARKETING ANALYSIS

Under Strategic Marketing Analysis, a SWOT analysis can be developed using relevant models to
gain a clear understanding of Clubb International's strategic position.

Strength Weakness
Clubb International had built a loyal customer Tarun Mullick's conservative and risk-averse
base, especially among young urban middle- approach had limited scalability and market
class women, thanks to its superior quality and reach for the company. The total control of
innovative designs. The company offered more operations was solely in the hands of the
than 200 trendy products at affordable prices. founder. Additionally, the lack of a proper
With a lean organizational structure, Clubb Customer Relationship Management (CRM)
International prioritized personalized customer framework affected customer engagement and
service and maintained complete ownership and retention. Slow expansion in terms of retail
control over its brick-and-mortar retail space and product assortment further
operations. The brand had witnessed growing constrained market growth. While primarily
customer demand from international markets recognized as a local brand in West Bengal,
like the USA, UK, and Australia, while also Clubb International lacked nationwide brand
maintaining a strong presence in the West recognition.
Bengal market. Furthermore, Clubb Stagnant sales revenue over the past five years
International shifted its target customer base to highlights the need for strategic improvements.
focus on a younger clientele. The absence of a clear advertising philosophy
Clubb International: Revisiting the Market Strategy
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Marketing Strategy

hinders brand building efforts both nationally

and internationally.

Opportunity Threat
The global sector was projected to grow at a The market faced challenges from the entry of
Compound Annual Growth Rate (CAGR) of established global brands, which had the
5%, with India experiencing a higher growth potential to expand into non-urban markets,
rate of 20% by 2017-18. There was an posing a competitive challenge. Strong national
increasing demand for travel goods in semi- brands like VIP had enjoyed near monopoly for
urban and non-urban markets, as well as Tier-2 a significant period. Price competition arose
and Tier-3 cities. This was driven by a growing from cheaper Chinese-made products and
travel-friendly population in India, unorganized manufacturers offering low-quality
characterized by rising disposable incomes and goods. Consumer preferences were divided
a higher number of women in the workforce. between premium branded segments and brand
The market offered opportunities for product copies influenced by fashion trends and brand
innovation and targeted marketing due to association. Environmental concerns related to
diverse customer needs. Additionally, there was leather-made goods and the pollution caused by
a rising demand for personal accessories like toxic waste further impacted the market.
watches and bags. The availability of a wide Additionally, a ban on animal slaughter had
range of quality and alternative raw materials, resulted in a shortage of domestic leather
including jute and vegan leather, further supply, adding to the challenges faced by the
supported product development. Moreover, the industry.
emergence of e-commerce platforms had led to
decreasing control of dealers in the market.

STRATEGIC MARKETING GOALS

There are several types of strategic marketing goals discussed in this case of Clubb International:

HOLD: Under the leadership of Tarun Mullick, Clubb market strategies had been put on hold.
GROWTH: With Arup Mullick joining the family business, a fresh perspective and energy had been
infused into Clubb, leading to successful entry into the online space, which contributed 25% of the
total revenue. Arup aimed to shift the marketing strategy towards growth, solidifying Clubb's
position as a market leader in the mid-segment category, expanding into the luxury segment, and
establishing new manufacturing units to meet demand beyond West Bengal.
NICHE: Despite the disruption in Western India, Clubb had regained its market presence and
attracted previous customers through the online platform, highlighting the strong appeal of its
product offerings. With a loyal customer base of middle to upper-middle-class individuals seeking
affordable luxury items, Clubb was positioned to compete with premium brands like Samsonite and
American Tourister, catering to the middle-class customer segment globally and the upper-middle
class in India.

In addition to pursuing a growth strategy, Clubb had the opportunity to implement a diversification
growth strategy. This was evident from their success in capturing the college and young population
consumer base, who had shown significant demand for college bags and backpacks for travel
purposes. It was evident that this particular segment had become the largest contributor to Clubb's
revenue.

Clubb International: Revisiting the Market Strategy

CLUBB INTERNATIONAL: REVISITING THE MARKET STRATEGY
Marketing Strategy

In terms of Ansoff's matrix, Clubb's position can be summarized as follows:

Market Present Products New Products

Present Markets Luggage and Business Bags Backpacks for college goers and
(West Bengal) youngsters, travel accessories

New Markets
(Global markets – Travel bags: Trolley bags, Backpacks made from Jute and
UK, Australia, briefcases, Ladies bags (Jute), vegan leather
Europe, and Rest of Soft shell and hard shell.
India)

STRATEGIC MARKETING ACTION

Competitive Advantage: Clubb achieved cost savings through innovative approaches, such as direct
distribution to retailers, employee involvement in the design process, having office space within the
factory premises, and embracing the e-seller model for online sales. They also offered a diverse
range of high-quality products made from innovative materials like nylon, polyester, jute, and
leather. Bulk orders with agencies like Kolkata Police and RAPF (Railway Protection Force) further
contribute to their success. Additionally, Clubb maintained a focus on continuous innovation,
product development, and delivering excellent customer service.

Generic Strategies: By successfully implementing a core competitive strategy in the market, Clubb
competed exclusively in the premium sector and avoided competing with lower-cost groups.
Dedicated efforts were made to enhance services for premium target groups, leading to consumer
recognition and perception of the brand as a high-quality and premium option. Clubb was highly
valued for its focused strategy and strong reputation. Customers appreciated and engaged with the
brand due to its exceptional offerings, creating a positive relationship with the customer base.

COMPETITIVE POSITIONING

Clubb International's market share in the Indian Luggage market was only 0.06%, equivalent to
revenue of Rs 2 crores out of a total market size of Rs 350 crores. This positioned the company as a
market follower with VIP Industries dominating the market.

The prime strategies available to Clubb International were as follows:

1. Avoiding hostile attacks on rivals: The company refrained from directly targeting competitors
like VIP Industries, Wildcraft, Hidesign, and Nappa Dori, posing no threat to market leaders
or challengers.
2. Providing good quality products: Clubb International focused on continuous innovation by
introducing new product variations in terms of colors, materials, designs, and styles. These
products were showcased in small batches on Clubb shelves.

Clubb International: Revisiting the Market Strategy

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Marketing Strategy

3. Emphasizing profits and differentiation over market share: Clubb International offered more
than 200 different products using various raw materials such as jute, PVC, nylon, corduroy,
and leather. The company also eliminated distributors and engaged directly with dealers to
protect profit margins, establishing a network of 128 dealers across India.

Clubb International: Revisiting the Market Strategy