• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
BW Businessworld

Report Card: Matrimony Of Fashion And E-commerce

The entire B-school learning goes for a toss when one sees so many mergers & acquisitions and closures & retrenchment in the early stage as this is supposed to be a characteristic of a relatively dying industry

Photo Credit :


Fashion has always an epitome of being young, appealing and the talk of the day. And in business environment of today, the same analogy holds true for the online retailers and the buzz term 'ecommerce'. So what happens when these two marry? Does that lead to a brawl, debate or unison?

Flipkart acquiring Myntra and the recent acquisition of Jabong by Myntra coupled by the recent decision of small fashion portals Freecultr, Zovi, Fashionara and Fashion & You to either step back or shut down makes one think how the marriage is working out to be. India's apparel and lifestyle market is a $70-billion industry and only 2 per cent of that is currently online. This fact is enough evidence to infer that industry is yet to pass the growth phase and still rests somewhere in infancy and growth stage.

The entire B-school learning goes for a toss when one sees so many mergers & acquisitions and closures & retrenchment in the early stage as this is supposed to be a characteristic of a relatively dying industry. What is that which is very pertinent to this industry and the answer is worth the thought.

Yes, everybody loves scrolling through those sections and applying all kinds of filter and sorts on price, brand, colors and what not. But the bigger picture is, on how many portals? The penetration of the big players like Flipkart, amazon etc. has grown exponentially and their target market is no longer limited to Tier I & II cities. Smart phones have achieved almost a complete success in driving the perception of the Indian buyer with mobile phone being a synonym to a smart one. What hasn't been addressed is a core pattern of Indian retailer who sets out to buy fashionable apparels.

The answer to this conundrum traces back to the old days when I used to accompany my mother to buy clothes. Initially whenever there came a new market, she would go around multiple stores surfing the collection of each and trying to find the best fit. This happened for another 2-3 times until she finalized one store which was the default first stop. She from then, refrained visiting the other stores and did not mind spending time and surfing the same store and exploring the entire variety. This is exactly the story with the alliance of the 2 entities involved.

The advent of all these gave the consumers a plethora of options and it was a fun and enthralling going through all of them and experimenting. But soon that was over as in this world, the notion of Big is beautiful seemingly dominates small is special. Without changing the interface or having another app to consume the storage, players like Flipkart, Amazon etc. offer the benefit of multiple product portfolios apart from convenience of shopping from one's desk. Once into Amazon or Flipkart website or app, one wouldn't mind checking the other sections but high likely switching between portals would distract a window shopper.

Let's come to the real nomenclature. The customer acquisition costs are sky rocketing during the initial phases and real lifetime value for niche players isn't lucrative. The primary growth drivers are lifestyle and fashion for Amazon & Flipkart and other big giants are seemingly eager to enter this space. Unequivocally this segment is meant for big boys as smaller ones are finding it hard to compete due to very large differences in the scale of operations. The niche operates in tier I cities mainly and logistics and other costs make them burn more and subsequently join hands with the big ones to survive or shut down.

With the battle between Flipkart and Amazon getting intense with each day and many foreign players so keen to establish Indian presence, this definitely an industry to watch for. I can say for sure, fashion and e-commerce would be the most happening couple for sure.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

Tags assigned to this article:
e-commerce myntra flipkart jabong fashion

Sidharth Sachdeva

The author is an MBA student at IIM Raipur and an alumni of University Of Delhi. A finance enthusiast, he is an avid writer and traveler

More From The Author >>