Fashion on Hold: Discounts fail to ignite spark in apparel retail
Despite festive season sales offering discounts up to 65 per cent, shoppers remain unmoved, leaving retailers in a predicament. The usual end-of-season clearance, advanced two weeks to December in hopes of a pre-Republic Day surge, has fallen flat.
Brands like Pepe Jeans, grappling with ‘stress’ in the mass value segment, pinned their hopes on the EOSS to revive sales. However, Manish Kapoor, Managing Director, confesses, ‘growth is tepid.’ The industry anticipates a rough quarter ahead, with any potential recovery shimmering only after April. Experts point to a combination of factors. Inflation has squeezed disposable incomes, pushing priorities towards leisure and travel.
Brewing since January 2023, fashion retail slowdown has further dampened spirits. As per the Retailers Association of India, overall retail growth, once vibrant at 9 per cent in August and September, dipped to 7 per cent by November.
Muhammad Ali, CEO, Forum Malls acknowledges while restaurants are still buzzing, fashion retail is under stress. He attributes the slowdown to store expansions masking the demand slump. However, he remains optimistic, believing in the enduring appeal of physical retail and the need for brands to constantly reinvent themselves.
ICICI Securities' survey reveals aggressive discounting, with Shoppers Stop leading the pack at 66 per cent, compared to its peers hovering around 40 per cent. But even these deep cuts haven't lured customers back. The value fashion segment, particularly hard hit, struggles to reclaim pre-pandemic sales per square foot.
The story unfolding in India's apparel retail landscape is a cautionary tale. Discounts, once a magic wand, have lost their charm. Consumers, conscious of value and prioritizing experiences, demand more. The future lies in understanding these shifting preferences, innovating offerings, and creating experiences that go beyond price tags. Only then can the aisles of fashion stores reclaim their lost vibrancy.
