Shafeeque

Zudio and Westside are the same company! But when they already had Westside, why make Zudio a standalone brand and maintain 2 brands in the same industry? They don't even share stores even though it will be very cost efficient Here’s why the TATAs are doing this: That’s because the space these brands occupy in your mind is more important to the company than the space they would save by sharing stores. Loss of brand recall from your brain would cost them more than the rent they pay for separate stores for both brands. This is the basics of product positioning. They want to have a clear-cut distinction in your mind about the two. Because otherwise, the brand recall becomes extremely confusing. People who love Westside go there for their superior quality. It is positioned for the mid to high-segment audience on the slightly mature side. Zudio, on the other hand, is for people who love fashion trends at great pocket-friendly rates. It is positioned for the mid to low-segment audience on the slightly younger side. Now imagine if one day, Westside starts selling Zudio kind of clothes and tries to trade them off for a cheap price, their main customers won’t buy them. Even though the Indian market is extremely price sensitive, including the mid to high-segment, they still won’t buy it. We need to understand that quality generally comes at a price. And Zudio compromises on that because it wants to make fashion affordable for the aspirational. Westside doesn’t compromise on quality because, contrary to popular perception — quality is the deciding factor, not price. Its purpose is consciously making style simple for every moment. People don’t care about how much a shirt costs. They care about its looks and feel. And since Westside customers are shopping from them not for price but for quality, they will lose trust in the brand. Losing customer trust & loyalty is costlier than paying rent for separate Westside & Zudio stores. But there’s another reason for this: We need to understand that not only was Zudio created to cater to the rising aspirations of the middle and lower-middle class of India, but it was also created to solve the biggest problem with Westside, which made Tata Trent’s retail spread across the country limited — Westside failed in tier 2 cities, and that destroyed the plans they had with it for tier 3 and 4. It failed majorly because of the price. Consumers in these areas want great prices, and premium clothing does not interest them. Also, Westside didn't spend much on brand awareness in these regions. Probably because they couldn't establish a good enough proof of concept there. Their product range was also not correctly positioned for tier 2-3-4 cities because they have subtle designs. Tier 2-3-4 is becoming trend-conscious and needs more trendy designs, which Westside could not deliver. And they couldn’t even pivot Westside to cater to the local needs in tier 2-3-4 because that would again ruin its brand perception. Westside had plans for expansion pan-India in many more cities, but since they were not able to reach profitability in tier 2, they understood that they could expand to 2 dozen cities at max. And hence, Zudio was born. With Zudio they want to have the first mover’s advantage in the tier 2-3-4 and the newly trend- conscious Bharat. And since tier 2-3-4 is totally dominated by the unorganized sector, Zudio was able to easily create its niche in the market with a stronger brand than theirs. With better trends to offer than what was already available in the market and matching their prices, it has the potential to dominate that market. If you liked this read do RePost 🔄 and follow us @FinFloww for more such reads every Monday, Wednesday, and Friday!