The apparel market in India is not as evolved as it is in some of the leading fashion capitals of the world. Talking of menswear, the Indian male, till a couple of decades back, was used to buying a piece of fabric, or receiving the same as a festival gift, and taking it to the neighborhood tailor to get it stitched as per his measurements. The tailor fulfilled not just his obvious role, but also that of an acquaintance, a stylist and a fashion advisor, all rolled into one. There was strong loyalty towards a particular tailor, much like the comfort levels we have with a specific retailer or a clothing brand these days. His inputs influenced your wardrobe mix a lot- at a time when there was no internet and the information superhighway to turn to, whenever we had a doubt, on just about anything.
The tailor and the salesman at the shop from where you regularly bought your clothes represented a strong human touch in the purchase process- after all, who would not like a validation from an expert on your sartorial selections. Human touch in fashion retailing, if we take it literally, had also a lot to do with how we experienced the tactile feel of the fabric or garment when we purchased them. Before the advent of colors and styling details in the office-goers’ wardrobe, fabric quality stood out even stronger as the mark of a discerning man.
There were only a few readymade menswear brands in India in the 1980s- they were either seen as luxury or as the choice of the youth or the fashion-conscious. The 90s saw many readymade brands coming up in the Indian market. The economy opened up and the business climate changed; this coincided with the media boom and rising international exposure- the lifestyle revolution was taking shape.
With India becoming a focus market for many international business houses, the apparel market saw the entry of many well-known foreign brands in the last decade. This coincided with rising levels of disposable incomes for a burgeoning middle class as well as increasing levels of fashion consciousness in India.
Since we are taking the evolution of menswear as a reference point here, it is important to consider that the cultural context has influenced the changing personality of the Indian man too. The ramifications of the same can be found in fashion preferences and even more so in how fashion brands advertised their products. Traditionally fashion brands showed the protagonist as a ‘successful’ man in the conventional sense of the word, often hinting at the inherited power that he wields. Many formal brands showcased the successful executives too- formal clothing was driving the category those days. With time, the dominant value systems in our country changed; fashion brands started showcasing different facets of the Indian male, the need to be yourself, the desire to follow your heart, and to define success in your own terms.
With increased fashion-consciousness and higher income levels, the Indian male has learnt to dress up differently for different occasions- today most brands have collections for different usage occasions like business, party, leisure and such aspects of life. Of late, brands have been reporting better sales growths in casualwear- like denims and T Shirts, more than formal shirts and trousers. This is quite understandable given the way offices are increasingly accepting smart casuals as work wear.
The plastic money boom and improved retailing avenues have triggered impulse purchases significantly in the clothing space. Today’s consumer is busy- he works hard and plays hard; he needs instant gratification and seeks convenience. Brands who are in OTC fabric businesses have been facing sales pressures and have ventured into readymade business too- often as extensions for the same brand or by launching news brands.
Online selling in India has witnessed tremendous growth in the past few years. Improved connectivity, huge investor confidence in e-commerce business models and favorable shift in consumer disposition towards transacting online, have brought about a big change in the e-retailing space in India. Apparel as a category has been very much a part of this trend.
If we look at readymade garments as an e-commerce opportunity- a couple of challenges seem quite logical for the reason that they seemingly come up as huge barriers. The first issue concerns the fit of the garments. Brands have their own patters for each size and many of them have collections in multiple fits. For instance a Size 42 shirt of Brand A could drape differently from a shirt of same size in Brand B; in fact, it is possible that Brand A might have two shirts in two different fits because they could be from two different labels or sub-brands. The second challenge is, of course, the hand feel, which in some ways is a measure of the quality of the garment.
With the readymade segment evolving, many brands have attained a critical mass and have large number of consumers who are aware of how their products fit, or how the quality of the fabric will be. This enables well-known brands to be picked by consumers when they look to buy clothes online. Liberal exchange and return policies by the portals have further lowered the barriers to the e–commerce boom in the fashion sector.
One big challenge for fashion brands in India is in being able to get necessary throughput per unit area in terms of sales. On rent to revenue ratio for retail space, we are way behind other prominent Asian markets, let alone the fashion capitals of Europe and America. Many brands have experienced a decline in profitability as they expanded their retail footprint to lower tier towns. Internet selling allows brands to spread their wings and be accessible to a much wider audience.
The largest e-commerce players in India in the fashion space offer a wide range of products from a wide variety of brands in varying price points to the ‘click-happy’ consumer. This variety coupled with the value proposition in terms of price and the convenience factor acts as a driving force for the category. Clothing and accessories continue to be one of the fastest moving categories in the lifestyle space, as far as e commerce is concerned.
The online space is seeing technological developments at a fast pace by the key players aimed at improving the shopping experience and improving their share of wallet. With smartphone sales booming in the country, mobile Internet connectivity too is on the rise and has crossed a penetration of 200 Mn. This would be more than half the Internet reach in India. In fact, the online market places are seeing proportionate consumer outreach through their hand phones.
From being a device used to talk to people over distances, and to send them short messages, the hand phone has indeed come a long way- it fulfills many roles in our lives- FM radio, the watch that tells the time, camera, computer with internet connectivity- it has indeed become your inseparable companion. Mobile apps of retailers help you carry your store with you wherever you go, and they have turned the battle for the share of the wallet into a battle for the share of the phone memory. They help retailers stay connected with you through push notifications and literally bring the store to your fingertips. We recently saw one of the major e-commerce players closing down their website and becoming a exclusively mobile app-based retailer.
From the point of view of major branded players, the brick and mortar formats continue to bring in the lion’s share of the business. In this context, it is important to look at the importance of Exclusive Branded Outlets (EBOs) in building retail brands. EBOs play a big role in making a brand salient and strengthening it to a point where it can attract consumers by the weight of its name. They showcase the collections the way the brand owners want it to be and are vital for building stature and image for the brand. While this controlled retailing environment does full justice to the glory of the brand, it also comes with huge capital and operating expenses, and is often not the most profitable of channels. Brands, therefore, try to get a mix of EBOs and other multi-branded retail channels where they bill the products to the retailers. As of now, e commerce, as a channel, is still a long way from being a big contributor to the channel mix of brands. However, the point to be noted is that they are indeed on a steep growth trajectory.
What we are speaking of here is a trend, of the emergence of a channel that is a recent entrant in the market. If we go by reports, the e-commerce market for apparel in India has crossed INR 3000 Cr in 2014. This is still a very small part of our clothing market, but has grown to this scale in such a short time. E commerce will continue to grow disproportionately and become a bigger channel for brands in the coming times.
When the QWERTY phones came a few years back, we thought they were here to stay. For those of us who are lamenting the absence of the ‘human touch’ in a shopping experience, they can take solace in the fact that we are in the era of the touch screen, and that the human touch continues to play its part, albeit in a very different way!