Some brands become synonymous with a culture. They become household terms that define products, begin to appear in pop-culture and entrench themselves in the lives of people. In Pakistan, as far as shoes are concerned, the brand that comes to mind is Bata.
A large, international, chain operating since before partition, with quality yet affordable footwear, Bata ticks all the right boxes. Today, it is one of the things that defines the middle class, from being the place to go for school shoes and joggers, to the infamous everyday wear such as the Bata ‘chappal’ that is safe in the collective consciousness of generations.
Yet the Bata story is not an overly complicated one, despite its 80 year old history in the Indian subcontinent and its more than century old history internationally. It is a story of consistency, persistence, and innovation at the right time. Particular in Bata’s corporate history has been its success in Pakistan, where it maintains its position as an iconic brand that still produces quality products that sell well.
Profit sat down with Imran Malik, a longtime Bata employee that has been leading the shoe company in Pakistan as Managing Director since 2013 to hear about his and Bata’s journey in Pakistan.
The first Bata outlet in what is now Pakistan was established in Lahore in 1942. Back then, this was a simple shoe brand operating a single store. Five years later, it would survive the violence and turbulence of partition, being incorporated in Pakistan in 1951 as the Bata Shoes Company (Pakistan) Limited. It would eventually go public in 1979 as Bata Pakistan Limited, and according to their website, now has a retail network comprising more than 467 retail outlets, 331 registered wholesale dealers and 105 DSP.
But even though Bata’s success in Pakistan was partly because of how well they fit in the country, the origins of Bata happened more than half a century before that first outlet in Lahore opened. In 1894, eighth generation shoemakers, Tomáš, Anna and Antonín Baťa, established the Bata Shoe Company in Czechoslovakia. Their first product, called the Batovka, was a shoe made of leather and canvas at a time when shoes were made of only leather. From here on out, there was little looking back, as Bata continued to grow and grow, today serving a million customers everyday in their 5300 retail stores all over the world.
In Pakistan, Bata has been able to create unique brands under its banner catering to different niches and audiences. Traditional and affordable Bata school shoes and slippers aside, Bata sells Marie Claire, their brand for women’s shoes, Power for sports, Bubblegummers for childrens’ shoes, and Bata comfort for special medicated footwear. In addition to this, they sell more high end brands as well, such as Weinbrenner and North Star sneakers.
This branding has been a slow but deliberate process, as Imran Malik explains, the brand has always been looked at as a specialized school and basic everyday shoes brand for the masses in Pakistan. “This imagery has consistently produced healthy and positive business results for Bata Pakistan,” he says. “However, Bata, as a brand, strongly believes in evolving with consumers lifestyle and demands, and is currently going through a transformation of its imagery into a brand that is modern, elegant and in-tune with changing times – through a revived, comprehensive & upbeat product range, fresh retail look & feel and integrating technology with business operations to serve its customers better and in a more efficient manner.”
That is what has allowed Bata to get where it is. Effective marketing has always been at the heart of Bata Pakistan, and the company ethos is one of designing and delivering communication that produces effective business results. “With reviving and elevating the image of Bata brand in Pakistan, we are currently following our global brand communication platform, yet we have ensured that it is deeply rooted in the local market, culture, and consumer insights,” says MD Malik. This, of course, is his challenge.
As the MD of an international company, the benefit is that you have a large company backing you as well as providing assistance and direction. However, to continue to connect with the local audience and tweak strategies accordingly is vital. “Our fresh communication idea, ‘Surprisingly Bata’,has so far produced positive and encouraging results in uplifting the Bata brand image among young audiences,” says Malik.
“We have successfully portrayed a fresh and vibrant brand image for Bata Pakistan. Moreover, with changing lifestyle trends, sportswear has evolved into an everyday lifestyle accessory – and we at Bata are proud to offer one of the largest sneakers range for our consumers in the country, a range that can cater to any and every lifestyle trend especially for the young and young at heart consumers. We shall continue to upgrade the range to always bring new, fresh and exciting designs and styles for our consumers.”
What makes Bata tick?
Bata’s key attraction in Pakistan has been exactly what most consumers in the country are looking for, quality and affordability. Bata offers an international, branded product that is designed for local sensibilities and comes with a reasonable price tag.
The way Bata has managed to do this is by tackling the challenges that many in the retail sector face head on. Despite the many operational challenges for businesses in Pakistan, such as under-invoicing and tax evasions that are affecting the overall market in a negative manner, Bata insists that it is their thorough belief in transparency, accountable and ethical business practices that allow them to stay ahead of the competition.
“Ever-growing competition within the category is another huge challenge for a brand like Bata Pakistan. Though, the retail industry and retail marketing is rapidly transforming in Pakistan, and the local market is among the fastest growing retail markets in the world,” says Malik. “New malls and retail spaces are being established across the country and the boom is continuing – this growth is not only offering more space to the brands, but also offering more choice and more variety to the consumers.”
This is where Imran Malik’s own brand of business leadership also comes into play. From what he says, it can clearly be gauged that for him clean and pristine execution is the key to the retail industry. It is about following procedure to the dot to make sure standards are maintained. “It is highly critical to define operational guidelines that ensure efficiency and quality. This is what makes an organization successful. It is also equally important to regularly revisit the guidelines to continuously improve & evolve for sustainable success and growth,” he says.
“Every individual operational parameter is a very important pillar for an organization, but for a business like Bata Pakistan, the impeccable execution is of critical importance. No matter how many sleepless nights you have spent to devise a perfect strategy that tactically aligns across every business function, but if your execution is not seamless with perfect attention to detail, everything else wouldn’t matter at all,” he explains. “I usually exercise business simulation scenarios with my team before its execution and it really helps us to figure out and indicates the degree of success to a certain extent, but again the real picture comes out after its execution.”
The Covid-19 blow
Of course, for all the attention of detail or painstaking execution, there are certain situations that leave everyone baffled. This has never been more apparent than in recent days, when the Covid-19 pandemic left countless businesses out of commission and others desperate to simply survive. Bata, with its more than hundred year history, was around when the Spanish flu infected more than a third of the world’s population. However, even they were not prepared now for the level of economic devastation that this pandemic has caused.
Their plans for evolution and a change in branding all came grinding to a halt because of Covid-19. “Covid-19 has severely affected the retail businesses which has resulted in the negative sales volume and overall operational profitability of the retail businesses across the globe. This new normal may totally change people’s lifestyle, their shopping behavior and their outdoor preferences,” Malik tells Profit. “But, at the same time, Covid-19 has hastened the Pakistani retail industry to focus on e-commerce, and just like other key brands – we are heavily focusing on offering our range through online shopping to our consumers.”
“During the near-future, the retail industry will continue to be challenged by the covid-19 aftermath globally and in Pakistan, as we have seen thousands of people losing their jobs, certain business functions becoming either temporarily or permanently redundant, there has been a severe impact on the small to medium businesses and an increasing pressure on the household income of local population.”
In the middle of these days, Bata has seemed cognizant of the situation and willing to play their role. Back in their early days, the Bata siblings had made clear the kind of company they wanted to be – one that took care of its employees and gave back to the community. Because Tomáš Bata believed that business had a responsibility to its employees, the company provided its workers with housing, schools, hospitals, libraries, and recreational facilities.
Now, with a global pandemic raging, Bata had launched the ‘Bata Heroes’ initiative. This initiative planned to donate 1 million pairs of shoes to healthcare workers, volunteers, and their families. The initiative covers a diverse range of countries that also include Pakistan, India, Czech Republic, Bangladesh, Colombia, Italy, Kenya, Zimbabwe, Chile, Peru, Thailand and Malaysia. Bata has also produced and donated face masks, face shields and Personal Protective Equipment (PPE) for healthcare workers. In addition, Bata has also donated food, hygiene products and funds through the Bata Children’s Program and the Bata Shoe Foundation.
“As a global leading shoe company, Bata feels responsible towards all its stakeholders, including the communities in which it operates across countries and regions,” says Malik. “Bata, globally, and in Pakistan, is driven by a belief to positively contribute to society, share its success with deserving sections of the community, and overall become a positive and enriching part of people’s everyday lives.”
To this end, Bata Pakistan specifically is donating 100,000 pairs of shoes to the Bata Heroes initiative. “In addition to the specific Covid-19 community initiatives, Bata will always continue to positively contribute towards its community projects like safe water filtration plants in areas where safe drinking water is not available, the SOS orphanage program and a lot of other initiatives.”
For now, Bata is continuing their plans and their Corporate Social Responsibility programmes the best they can during the pandemic. And while things are different, they have been handling it with a cool head. “Bata Pakistan is following and has implemented all social distancing measures of Covid-19 at Bata Stores for the safety of consumers and its employees,” says their MD. “We are aligned with the Pakistani government, and our global policies regarding Covid-19 and religiously following each and every guideline. People are our most treasured assets, which is why our prime objective is safety, health and wellbeing of our employees and consumers – and we will never compromise on this.”
It has been a hard road, but as cases drop in Pakistan, business is also picking up once again, and Bata has taken this time to improve their online presence and e-retail footprint, like most brands both big and small.
“Every black cloud has a silver lining, we have taken this current Pandemic situation as a window of opportunity and have started to aggressively focus on our end to end online stores where we are reaching to our valued customers at their doorstep,” says Malik. “Our online store at www.bata.com.pk is a one stop destination for men, women, Kids to fulfil their shoe buying needs. Our online store is user friendly, highly efficient with a very easy process to select & buy the required shoes.”
Bata’s market performance
As a publicly listed company, Bata Public Limited has been a listed entity since 1979, and is a part of the KSE 100 index. And over the years, Bata has remained a frontrunner in the local shoe industry.
According to a report by Business Recorder in 2015, the financial history of Bata Pakistan has been stable, with the company showing a gradual increase in both sales and profits, and seeing its fortunes take a very good turn around 2010 and continuing to do so over the years. Bata Pakistan is also part of an exclusive club of companies that generate over Rs 10 billion in annual revenue. They first got to this figure back in 2012, when the top line grew 17 percent to nearly Rs 11.5 billion. However, while Bata continues to dominate the market, its performance is not as stellar as it once was. Essentially, Bata is still accelerating, but not at the same rate as it was once.
This has mostly been because in recent years, a lot of smaller, local, cheaper brands have entered the market, and while Bata has the lion’s share, the competition combined together has been stiff. A different report, this one from 2017, said that the operational atmosphere has become very tough for Bata Pakistan Limited in wake of the rising informal sector, and that going forward, things are not expected to get any better. Sales growth is expected to take a further dip in coming years.
However, with nearly 80 years of experience just in Pakistan, Bata seems set to ride out the competition and continue to hold its cemented place as Pakistan’s leading shoe brand. As their MD himself admitted earlier, “ever-growing competition within the category is another huge challenge for a brand like Bata Pakistan. Though, the retail industry and retail marketing is rapidly transforming in Pakistan, and the local market is among the fastest growing retail markets in the world.” However, Bata’s unique way of business and focus on execution efficiency sets it apart and up for success.