At the on-goingIndia Fashion Forumin Mumbai, retail experts from India and abroad, sitting on the forum panel have deliberated and expressed some important and interesting antidotes for the future of Indian retail. Some points reaffirmed what we already knew, although other statements were worth more than a passing glance.
Its a long held view that Indians prefer to go to their family jeweller to buyprecious jewellery. While online retailers have made inroads to get over the touch and feel before buying aspect, there is clearly a lot of work to be done to break the age old tradition.
“No online jewellery business is making money. It is not very online friendly. Jewellery market is more for offline consumption than online,”stated Sandeep Kulhalli,vice-president- retail and marketing, Tanishq, Titan.
Merchandise such as shoes, wrist watches and clothes quite literally fly out of the warehouses, into the delivery vans and fulfilled at the customers door step, such is the demand.
“Amazon will be the largest apparel retailer in US by 2020. It will reach a turnover of $60 billion followed by Macys at $25-30 billion. Watches and footwear segment will trail the apparel segment in retail,”said Sandeep Mukherjee, SAP Hybris Head, Indian sub-continent.
Despite the large demand for online fashion and apparel, the distributors In India of Luxury brands still remain unconvinced.
“Nike strategy is to sell in a proper hygienic manner without losing value. Though online contributes 5-7% of sales, it dilutes the brand value and position,”remarked Rishab Soni, managing director of SSIPL Group.
We have seen the success in India of some online categories, while others have so far got a lukewarm response. At the same time many retailers are looking online as a way to stay relevant, with theomni-channel strategygaining momentum.
A senior partner and director at theBoston Consulting Group, Abheek Singhi cited a case study, when he said that 8 out of 10 successful online companies in the US, started off as physical stores. The same holds true of the UK market where 7 out of 10 successful ecommerce firms, were bricks and mortar stores once upon a time.
“Indian retailer must take cues from their global counterparts to opt the right omni-channel initiatives to ensure success over the medium to long term period. Amazon has outperformed its peers on the bourses over a 10-year period, but Macys, a less known retailer, has performed well over five year due to its right omni-channel initiatives,”enlightened Singhi.