advertisement

eCommerce Firms Bet on Fashion To Gain Ground

advertisement
Information about eCommerce Firms Bet on Fashion To Gain Ground

Published on January 6, 2017

Author: ashishjhalani

Source: slideshare.net

advertisement
Content

1. wwww.etailingindiaexpo.com eCommerce Firms Bet on Fashion To Gain Ground Amazon India and Flipkart are revamping their fashion categories, launching private brands and hunting for more exclusive partnerships to increase sales of a category that offers higher margins than smart-phones and televisions, two of the other three largest categories in e-commerce. #DigitalErra Thought Corner The revamp comes on the heels of a tight festive sale season where the online marketplaces relied heavily upon two of the biggest revenue generating categories: Consumer Electronics and Fashion Apparels. The sale of online fashion goods reported a growth by 52 percent from Rs 4,699 crore in December 2014 to Rs 7,142 crore in December 2015.

2. wwww.etailingindiaexpo.com This segment is expected to reach Rs 72,639 crore by the end of 2016. Together, fashion and electronic goods amount to more than 60 percent of the overall spend in e-tail. Etailers Choose Fashion As The Arena Fashion is one heck of a category where the returns are much stronger compared to Electronics, FMCG and else products. One can expect a margin of 30-40% and hence, it is a field of choice for eCommerce majors to overturn stakes in the market. Strategies Adopted By Etailers Amazon indicated it intends to expand its private label portfolio and launch newer product lines, as it looks to differentiate its offering from Flipkart and Flipkart-owned retailers: Myntra and Jabong. In recent

3. wwww.etailingindiaexpo.com times, Amazon has forged deals with leading brands such as Aeropostale, Arrow and Swarovski on certain product lines. To push private labels, Amazon even hired top executives from rival companies such as former Myntra chief creative officer Gautam Kotamraju. In September, it launched Symbol- the first of several private brands it is likely to launch over the next year. It is trying to follow the model of successful fashion houses such as Myntra which created big brands out of private labels such as Roadster. Now, in-house brands such as Roadster, Mast & Harbour and Dressberry account for nearly 25% of Myntra’s sales. Roadster is one of the top five brands on Myntra’s platform at the moment. “We are still at an early stage (with private labels),” said Arun Sirdeshmukh, head of fashion at Amazon India. “We are putting together the building blocks. Should we do more of it? There are many product lines that we’d rather add to these brands that we have on the table. That’s the journey.” Meanwhile, after four years in its current avatar, Flipkart Fashion is being revamped to expand its user base beyond the current mass segment. The home grown e-tailer is reintroducing its fashion business as it partners with over 100 stylists who will curate fashion trends and accordingly push products on its platform. Much like traditional brand retailers, it is in talks with movie production houses to sell their collection starting next year.

4. wwww.etailingindiaexpo.com The Flipkart-owned Myntra operates in a similar market targeting the mass premium shoppers with offerings based on latest trends and themes. The new positioning for Flipkart Fashion would mean that the company is trying to tap into a new set of consumers who are ready to spend more. It would also help Flipkart reduce its dependency on Myntra, which it acquired in 2014, to drive the major chunk of high value fashion sales. However, Rishi Vasudev, head of Flipkart Fashion, was cleared the air of any cannibalization in the market even as Flipkart and Myntra target the same set of customers. Vasudev said the change in pricing will not be dramatic. "We are starting a 360-degree campaign for Flipkart Fashion which goes beyond talking about our brand stores and looking to expand user base. This will take Flipkart Fashion market share further ahead by at least 5% next year and boost overall sales," he said. The move is also in line with Flipkart's core strategy of focusing more on increasing listings by sellers, particularly the smaller long-tail merchants, where Amazon India currently has an edge.

5. wwww.etailingindiaexpo.com Where Are The Niche Fashion eCommerce Players Going? Half a dozen niche online fashion companies continued to pile up losses in the last fiscal year. Voonik, Zivame, Koovs, Lime-Road, StalkBuyLove and Craftsvilla reported a combined loss of Rs 515 crore for the year through March 2016, compared with Rs 134 the year before. Flipkart, Myntra and Jabong trio, alone captures about 70% of the online market, thereby leaving a small ground for others. Hence, a few companies are changing their business model. "Till the end of December 2015, we were generating orders for other marketplaces. Then we had to switch because we were not getting money on time and companies were changing commission rates whenever they want," said Sujayath Ali, founder of Voonik, which

6. wwww.etailingindiaexpo.com posted revenue of Rs 17 crore last fiscal year, compared with Rs 41 lakh for the previous year. So, Product innovations and selection remains the key for niche online fashion players to go on. Conclusion The stakes are high in the space of fashion eCommerce and Flipkart would be desperate to hold its ground in the face of Amazon’s spending might. 

#digitalerra presentations

Related presentations


Other presentations created by ashishjhalani

Entrepreneurs in India india
06. 01. 2017
0 views

Entrepreneurs in India india