The Vande Bharat Express is becoming highly popular and generating a lot of curiosity. Many Indians are proud of this indigenous, sleek-looking, semi-high-speed product developed by the Integral Coach Factory (ICF) Chennai. ICF Chennai’s Train18 project that gave birth to this modern train set was completed in record 18 months, against the world standard of a minimum timeline of 36 months, from conception to prototype development.

According to Sudhanshu Mani, the then General Manager of ICF Chennai who led this project, the train set was built at just one-third of the cost of an imported equivalent train. ICF also holds intellectual property rights for the same.

So, on the lines of notable national accomplishments like indigenous missile development, PSLV, Chandrayaan, Mangalyaan, vaccination drive and so on, Vande Bharat Express has also become very close to people’s hearts.

People clamour to take selfies with the train at railway stations, and children are ecstatic. In last year’s Union budget, the Indian government announced plans to launch 400 Vande Bharat trains over three years. So far, dozen-plus routes are operational. The Chennai-Coimbatore Vande Bharat Express, which the Prime Minister launched recently, is the 14th in this series, and many are in the anvil.

Additional revenue stream

With so much craze for selfies with the train, there could also be a demand for Vande Bharat miniature toy trains. The railways will have an additional revenue stream if they pursue a merchandise marketing strategy. There could be merchandising opportunities in many such train models — like the luxury trains (Palace-on-wheels, Golden Chariot), legacy trains (Nilgiri, Darjeeling Himalayan rail), heritage stations (like Mumbai CST, Chennai Central), etc. Apart from these, there could be many railway-branded merchandise items like mugs, posters, watches etc. Indian Railways can do a market study on this.

Merchandise strategy is quite popular in the American film industry. Disney’s Frozen-2 reportedly made a worldwide box office collection of $1.45 billion. Frozen-1 made $1.3 billion in 2013. But it earned $ 5 billion in Merchandising and licensing alone. On e-commerce sites, you can find Frozen-themed dolls of Anna, Olaf and Elsa, Frozen lip balm, cotton bath towels, jigsaw puzzles, t-shirts, flip-flops, backpacks, princess necklaces, coffee mugs, watches, story Books, socks, sipper bottles, colouring books etc.

Merchandising and brand licensing is a big business, and movies ranging from Star Wars to Minions raked in more dollars with merchandise from toys and apparel to books! According to the Top Global Licensors Report 2022, 88 licensors have reported revenue of $260.8 billion.

Films like Dhoom and RaOne tried it in a limited way in India. Compared to other Indian movies, Bahubali tried more items, games and even an animated series on Amazon Prime. Ramoji Film City in Hyderabad still has Mahishmati sets of Bahubali for public view. Chota Bheem is one comparatively well-capitalised merchandising phenomenon on the Cartoon front. Several IPL teams have done well in this area. But, the industry is yet to tap its full potential. Doordarshan tried to capitalise on the nostalgia value through merchandise items in the souvenir store. But, it was restricted to collectable items like water bottles and t-shirts.

Untapped potential

Aircraft manufacturers and airline operators worldwide sell branded merchandise through dedicated websites, mobile apps, aircraft and airports. The merchandise includes aircraft models, clothing, collectables, and accessories (bags, watches, mugs, power banks). There are dedicated websites in the US, Japan and Europe for the sales of railway merchandise of Amtrak, Eurostar etc. Cruise lines also focus on merchandise sales as a revenue stream.

In the case of the Indian railways, there is no need for extra investment in real estate. The merchandise could be sold on trains, the vast network of railway stations, and online. Indian Railways have already published nearly 40 coffee table books, which could be added to this bouquet. IR also maintain 34 rail museums and heritage galleries, which could provide ideas and counters for promoting heritage collectables. A well-planned and executed merchandise marketing strategy shall open a new revenue stream for the Indian railways. IR can experiment with this on a pilot basis in the premium train.

(R. Sathyanarayanan is Sundram Fasteners Associate Professor of Marketing, IFMR Graduate School of Business at Krea University)