Global fashion brands such as H&M, Zara, Forever 21 have been growing their presence in India. Now, in a bid to secure their position, domestic labels such as AND, W, Biba, Mineral, among others ramping up their growth strategy. With a strong understanding of local tastes and purchase habits, domestic brands have a fair chance to win the battle in this Rs 3 lakh crore Indian fashion retail market. These brands have adopted visibility, affordability and variety in terms of styles as their key differentiators while boosting their marketing capabilities.
Fashion knows no boundaries
Recently, Anita Dongre (AND, Global Desi labels) launched her first store in the US, Anita Dongre Grassroot on New York’s Broome Street. In the domestic turf, House of Anita Dongre is expanding its presence in the big metros and looking to penetrate into Tier II and III cities. Bijit Nair, President-retail, House of Anita Dongre, explains they want to have the first mover advantage before the likes of H&M and Zara start rallying into Tier II, III cities. Out of 100 exclusive stores that it plans to open, 70 will be in Tier II, III cities. At the same time, House of AND is looking at avenues to bring more freshness in their merchandise. The company wants to bring new styles every fortnight and give more value to customers.
Bringing out new designs faster has also been one of the major focuses homegrown brands are looking at. This requires streamlining supply systems, where many brands could falter, feel experts. Baqar Naqvi, Director, Wazir Advisors, points out players like H&M, Forever 21 have the potential to alter the Indian market. The economy, affordable, mid-priced Indian brands will feel the heat and re-think their strategy as consumers shift to international street fashion brands, shunning Indian ones which till now were largely playing a lower price than the market leader game.
The e-commerce rally
E-commerce has taken centerstage in fashion retail. According to Euromonitor International, Internet retailing in India grew 1,200 per cent since 2011. The fastest product categories moving online were apparel and footwear and consumer electronics, which have been the first categories to migrate online globally. In India, both categories have a relatively high penetration rate of online sales at 9.5 per cent and 15 per cent respectively (2016), the report said.
In this race to win customers, Indian brands are also quick at adapting discounting strategy. Instead of pitching themselves as cheap alternatives to global labels, they are organising sales and seasonal discounts and being more fliexible with their pricing strategies, just like international brands.
Jaydeep Shetty, Chief Executive of Mumbai-based fashion chain Mineral, points out they are planning to bring the cost down 12 to 15 per cent across the board to improve volumes. He believes if prices drop 12-15 per cent, volumes can go up by 40 per cent. The idea is to offer better quality and sharply priced products compared to fast fashion brands. Naqvi however feels cutting prices will only work in a limited way, as global brands not only are lower and sharply priced but also have the appeal of being ‘international’ and have the edge of being in sync with latest fashion trends. So instead of pricing lower, Indian brands should try to find their own niche.