New Delhi: The Indian unit of Reebok, the sportswear brand owned by Adidas AG, plans to launch a new retail format that will entail greater interaction with customers, seeking to reinforce its presence in a country where it is under investigation for financial irregularities allegedly committed by its former management.
Reebok also plans to introduce a raft of products, including shoes and apparel, focused on individual fitness, said Matt O’Toole, the brand’s global head, who is on his first visit to India to brief franchise partners about the launch of Fit Hub, as the new retail format is called, and an advertisement campaign billed ‘Live with Fire’.
“Fit Hub will be a new expression of the brand its much more fitness focused, it’s a place where consumers can come and not only find the right products but also get advice about what the right fitness regime for them would be , the right gym to go to etc,” said O’Toole, who took the brand’s operations in September. “We believe we will have 50 concept stores for Fit Hub by the end of 2013.”
Indian authorities are probing alleged financial irregularities to the tune of Rs.870 crore at the local unit of Reebok. Adidas has put the blame for the irregularities, which surfaced in May last year, on those on those running Reebok India at the time including Subhinder Singh Prem, former managing director, and Vishnu Bhagat, former chief operating officer.
Prem and Bhagat, along with Sanjeev Mishra, who ran a staffing services company that supplied contract employees to Reebok India, have been in custody since September. Eight other former executives who were arrested in the case are out on bail.
Reebok stores in India have been getting rid of stock at a discount over the past few months, ever since news of the fraud case broke.
O’Toole said the company will focus on a ‘mono brand’ retail format globally and concentrate on a narrow group of consumers.
“Reebok does extremely well when it shows up in a mono brand environment. So my goal is to show up in an as many markets around the world in this kind of mono branded environment whether it means stores or shop in shops, where the consumer can walk in and experience the whole brand and see the breadth of our range, whether it’s apparel for their fitness needs or apparel for their lifestyle needs and the same is true in footwear,” he said.
“Earlier brands were comfortable with broad but not so deep relationship with many consumers and I think where we are today is we have a more deep relationship with a narrow group of consumers.” he said.