Source: LiveMint.com, Dec 28, 2016
Bengaluru: Amazon India and Flipkart are revamping their fashion categories, launching private brands and hunting for more exclusive partnerships to increase sales of a category that offers higher margins than smartphones and televisions, two of the other three largest categories in e-commerce.
Amazon indicated it intends to expand its private label portfolio and launch newer product lines, as it looks to differentiate its offering from Flipkart and Flipkart-owned retailers, Myntra and Jabong. In recent months, Amazon has also signed partnerships with leading brands such as Aeropostale, Arrow and Swarovski on certain product lines.
“We are still at an early stage (with private labels),” said Arun Sirdeshmukh, head of fashion at Amazon India. “We are putting together the building blocks. Should we do more of it? There are many product lines that we’d rather add to these brands that we have on the table. That’s the journey.”
In August, Mint had reported that Amazon India was planning to create its own private brands in fashion and had hired executives such as former Myntra chief creative officer Gautam Kotamraju to help drive its push into fashion labels. Amazon launched a private label brand called Symbol in September—the first of several private brands it is likely to launch over the next year.
With private labels, Amazon is attempting to replicate the kind of success that online retailers such as Myntra have enjoyed by creating big brands out of private labels such as Roadster.
Now, in-house brands such as Roadster, Mast & Harbour and Dressberry account for nearly 25% of Myntra’s sales. Roadster is one of the top five brands on Myntra’s platform at the moment.
“You should definitely expect more product lines because these are currently a western-wear brand and an ethnic-wear brand. There are many products that we haven’t yet launched but are slated to. For example, we do a lot with top-wear, but there’s also more to do with bottom-wear — there’s denim in that area. So, we are working on those product lines,” said Sirdeshmukh.
Amazon is planning an end of season sale event in fashion with big discounts for shoppers, as it looks to regain momentum that had been disrupted by the government’s demonetization drive.
Amazon also indicated that it will enter newer categories over the coming months, especially in women’s fashion and womenswear. “Are we there in all categories? That journey is never complete,” said Sirdeshmukh, who joined Amazon from online retailer Fashionara.com which shut shop earlier in 2016.
Fashion retail on e-commerce portals is expected to constitute 35% of the total online retail revenue generated in India, which is expected to touch at least $35 billion by 2020, according to a recent Google report. By this time, fashion may overtake smartphones as the largest product category.
Amazon’s plans to expand rapidly in the fashion category comes at a time when the company is locked in a bruising market share battle with arch rival Flipkart, with both players targeting categories such as private labels where online retailers can potentially enjoy high margins on sales. It’s important for Amazon to build a large fashion business, especially as Flipkart and
Myntra currently dominate online sales of apparel, shoes and accessories.
Flipkart on Tuesday said it is revamping its fashion business and re-launching the category, with key partnerships and tie-ups with television channels, film magazines and celebrities. It also indicated it may launch a new private label sometime during the middle of 2017.
“Over the last 6-8 months, we have been focusing on improving our selections further. This is not by adding more styles—we want to add more relevant styles and also to bring in better discovery for customers,” said Rishi Vasudev, vice-president, fashion, at Flipkart, adding that
Flipkart has tied up with Colors TV channel as part of this re-launch campaign.
Flipkart said the revamped fashion portal would go live on Tuesday and that it would launch a big campaign to promote the revamp in the first week of January.
“In that light what we are doing is we are doing an entire refresh of the fashion (vertical), where we have curated the whole selection based on what people are searching for. What we have also done is we have associated with all the key influencers of fashion, right from Bollywood, film magazines, TV celebs, as well as international trends to really curate the selection around that. So, we have associations with a few leading names from each of these, so you will see selections from them,” said Vasudev