Leveraging the Rs 2500 cr toy industry opportunity: R Jeswant

Funskool is on an expansion spree in metros and Tier I cities and is increasing its store count from 13 to 25-30 across the country by March 2017.

Simultaneously, the company is intending to strengthen its own brands while continuing to acquire international brands and licenses. It is growingly focusing on its own infant pre-school, dough, educational puzzles and arts and crafts brands along with offering the leading international brands licensed by Disney, Warner Brothers, Nick, Rubik’s, Ravensburger, and Jumbo. Further unveiling the brand strategies R Jeswant, Senior Vice President, Sales & Marketing, Funskool India Ltd, spoke to Indianretailer.com.   

What inspired you to launch a store in Korum Mall, Thane? What is the total area of the store?
The total area of the store is 792 sq ft. We saw an opportunity in Korum Mall as there is no other toy specialist store in this mall. Thane is a fast developing suburb of Mumbai and Korum Mall has good footfalls. The initial response to the store has been in line with our expectations which vindicate our decision to launch a store here.

What is the range of international and company-owned brands you are offering in the store?
We represent LEGO, Hasbro, Tomy, Leapfrog, Crayola, SIKU, Thames & Kosmos, Ravensburger, Hornby and several other leading toy companies of the world in India and have licenses from Disney, Warner Brothers, Nick, Rubik’s etc. All the above brands have been given good exposure in the store. We also manufacture several toys in India under license from companies like Ravensburger, and Jumbo. We are always on the prowl for new licenses which we feel have potential in India.

In addition to the international brands mentioned above, we also have our own brands like Giggles which is our infant and pre-school brand, Fundoh, the dough brand, Play N Learn the educational puzzles line and Handycrafts our arts and crafts brand. We handle more than 20 different brands currently.

Are movie-based or character-based toys largely demanded in the market?
Of course! Toy merchandise based on TV animation or movies catch the fancy of kids very easily. Spiderman, Avengers, Star Wars among others are recent  movie properties which have had a very successful range of licensed toy merchandise from companies like LEGO and Hasbro which we had access to, being the authorised national distributors for these brands in India. We also manufacture puzzles and board games under license for the above properties at our factories.

How is the demand for toys changing from traditional character based to smart tech driven?
Infant and Preschool toys will always continue to be relevant. Even in this category there is increasing use of electronics. Learning tablets, electronic games and robotics are all becoming increasingly relevant. However, I personally feel that traditional toys will continue to be relevant in India for quite some time as we have barely scratched the surface as of now.

What is the target age group you are catering to? And what are your strategies of brand communication with kids?
Our core target group is from 0 to 12 years but many of our LEGO sets, board games appeal to adults and collectors as well.

We advertise many of the brands that we carry, regularly on TV. For our infant and preschool toys we also advertise in women’s and parenting magazines. We communicate with older children through Kids TV which is cost effective. We advertise on general entertainment channels when we are communicating to mothers. Increasingly we are tending to use the digital media in our communication to kids and parents. In-store demos, events and competitions are also helpful in getting kids to touch and feel the different products that we have to offer.

What is your current retail presence?
We currently have 16 retail stores in India, including an exclusive LEGO store in Chennai. We have a very strong presence with all the leading E-comm portals in India. As of now we do not sell directly from our own web site. E-commerce is playing the critical role of reaching out to customers with awareness and purchasing power that are based in smaller towns       which have very limited stores stocking branded toys.

What are your future expansion plans?
We currently have 16 stores and are planning to increase the count to 25-30 stores by March 2017. We will continue to expand our retail presence. We intend to strengthen our own brands while also continuing to acquire international brands and licenses which have relevance in India and provide synergy to our existing lines. Expansion of the distribution network is another key area of focus. With our strong manufacturing base we are in a position to price products at levels which appeal to customers even in smaller markets.

We are also looking at launching a couple of new brands. We have product development teams working in full swing to churn out new products under these brands. We have recently launched international brands like Crayola, the leading stationery brand and Thames & Kosmos, a leader in Science Kits. Both the brands have started off well.

What is the current scenario of the toys market in India?
India does not have much history for branded toys. Prior to the 1990’s, international toy brands were not easily available in India and therefore it is only now that we are seeing parents with some awareness of branded toys coming in to the market. The advent of organized retail has resulted in better visual merchandising and this has provided exposure to parents and children about the range of toys that are currently available. We expect the market to grow exponentially as business and purchasing power keep growing.

According to you, how big is the market of toys in India in terms of revenue?
The global toy market is about $85 Billion USD and the Indian toy market is worth Rs 2500 crores (a little over US$ 400 million) which makes the Indian market roughly 0.5 percent of the world toy market. This is also an indication of the promise that the market holds out for the future and that is the reason why most international Toy companies see a great opportunity in India in the future.