Feedback
A pioneer B2B media and publication platform connecting with Fashion Brands & Retail in India

Competition leads brands/etailers beyond metros to smaller cities

Competition leads brands etailers beyond metros to smallerWith competition in India’s metros and Tier I retail markets intensifying on account of escalating labor and real estate costs, many brands are veering towards the Tier II and III cities. Household appliances, fashion and FMCG brands have been pursuing growth in smaller cities and for the last few years.

Growth fuelled by consumer interest, and lower operating costs

Eight cities are classified as Tier I cities on the basis of their Competition leads brands etailers beyond metroshigher standard of living, higher incomes and well-established business circle. Brands prefer these for opening their offline stores as customers here have a higher spending power. Though the retail industry still expects many new brands to open their stores in these cities, it is aware that both brands and stores have reached a saturation point in Tier I. Perhaps that is why one third of new stores are now being planned in Tier II and III cities and towns.

What’s encouraging is that consumers in these cities are becoming increasingly interested in fashion. Almost 60 per cent of brands are expanding sales in Tier II and III cities. Also, the cost of operating a business in these markets is about 30 to 40 per cent lower than that of Tier I which makes them more lucrative.

E-commerce sales provide a major fillip

E-commerce sales are also driving growth of the Tier II and III markets. A recent RedSeer report notes, total e-commerce sales reached $ 53 billion in 2018. Of this, non-metro customers, which constituted 42 per cent of online shoppers in 2016, are expected to rise to 55 per cent by 2020. Even major e-commerce players like Flipkart, Amazon and PayTm Mall are aware their next wave of growth is likely to come from smaller cities. Amazon India recently revealed, over 82 per cent of its customers are now in Tier II or smaller cities. To exploit this situation, Amazon brand has tied up with StoreKing and Vakrangee to provide customers in smaller markets, access to the convenience of online shopping. To achieve this, it aims to encourage first-time online shoppers to embrace e-commerce.

Flipkart offers EMI on debit cards, allowing shoppers to buy expensive products with monthly installment. The eretailer has also launched ‘made-for-brand billion’ to meet the needs of its customers in small towns.

Besides established players many e-tail start-ups are also turning their attention towards markets in smaller cities, and providing localised services to gain market share. A recent example is Club Factory, a Chinese e-commerce platform which is attracting young customers in smaller cities with its fashionable products at a cheap price.

LATEST TOP NEWS
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10

Park Avenue Woman satisfies style and design needs through its new collection

Park Avenue Woman satisfies style and design needs through its new collection

According to Sharad Walia, Brand Director, Park Avenue, “Women today emphasise more on the style and design of their clothes. They prefer readymade garments over tailored garments.” Based on these... Read more

Desi Belle introduces new designs and colors

Desi Belle introduces new designs and colors

Ethnic wear brand Desi Belle introduced fresh designs and colors in its Spring /Summer ’20 collection. “The new collection offers fusion and luxury wear for the middle and upper classes,”... Read more

Toonz Retail ready with a colorful, vibrant, energetic A/W collection for kids

Toonz Retail ready with a colorful, vibrant, energetic A/W collection for kids

The Autumn/Winter collection of Toonz Retail is all about celebrations and parties. “Colorful, vibrant and energetic, this collection focuses on a creating a comfortable party ensemble,” affirms Shard Venkta, Managing... Read more

Pepe Jeans’ new kids collection celebrates the brand’s iconic heritage

Pepe Jeans’ new kids collection celebrates the brand’s iconic heritage

The A/W ’19 kids’ wear from Pepe Jeans London celebrates the iconic heritage of the brand through its archive logos and motifs. “The collection offers a colourful mix of knits... Read more

Babla Designer’s exclusive range fuses traditional and modern designs

Babla Designer’s exclusive range fuses traditional and modern designs

Gen-X and Gen-Y women are perpetually concerned about their looks. Be it office or homes, they want to look good 24X7. Their growing income and emerging lifestyles is propelling Indian... Read more

Status Quo launches new store and collection

Status Quo launches new store and collection

With a vision to create a new casual wear range for youngsters, menswear brand Status Quo plans to open 18 stores across Delhi, NCR and Punjab region by 2020-21. The brand... Read more

Indian streetwear finally comes out of shadows

Indian streetwear finally comes out of shadows

Indian fashion is slowly warming up to streetwear as was evident from a recent fashion show. At this show, four streetwear lablels including Six5Six Street, Biskit, Gundi Street and Mumbai-based... Read more

Luxury goods makers positive about business despite a slowdown

Luxury goods makers positive about business despite a slowdown

As is evident from a luxury shopping festival currently underway at the DLF Emporio Mall in New Delhi, the luxury goods sector is facing a definite chill this festive season.... Read more

Zola attracts the youth with stylish, right priced fusion wear

Zola attracts the youth with stylish, right priced fusion wear

India’s fusion wear industry is on a growth curve and causing ripples in the women’s wear segment. Zola, a well-renowned brand for young women, is standing firm in the potential... Read more

W launches new festive collection

W launches new festive collection

Women’s brand W by TCNS Clothing has launched its festive collection ’19 called ‘Pop Sets’. Made from unique fabric combinations like chanderies, denims and the eco-friendly Livaeco fabrics, the collection... Read more

MOST POPULAR NEWS
Go to top