The adoption of e-commerce has created a transparent market wherein a brand cannot be sold at differential prices or discounts across channels.

1. Changing Lifestyles will be the next disruptor - Fibre2Fashion.com
The adoption of e-commerce has created a transparent market wherein a brand cannot be sold at
differential prices or discounts across channels. And, it will not be long before online players start
targeting market share rather than grow the market. But where Indian brands underestimate themselves
is their ability to adapt to trends, and to bounce back, says Jaydeep Shetty.
Liberalisation made its advent on Indian shores 25 years ago, and 45 per cent of Indians now are under
the age of 30. Little wonder then that most youngsters today don't find foreign brands alien to their
lifestyles as some of us old fogeys arguably do. In the last three decades, there has been a plethora of
fashion and lifestyle brands that have met with different fates. In many cases, the respective destinies
were written the moment they boarded their flights to India.
The reasons for the success or failure have been the same: choice of location, choice of local partner,
ability to adapt to Indians, the arrogance or temerity of brand leaders, and the pricing of the product.
Recent forays by foreign entrants into the women's fashion segment have found that success is a low-
hanging fruit, and the reason for this has been the sweet rental deals with malls, equivalent global pricing
models, and a younger post-liberalisation demographic.
As owner of a brand called Mineral that caters to the modern Indian
woman with westernwear and has just moved beyond the start-up
mode, I find that the conundrums are varied and numerous. We
straddle the space between European westernwear and the Indian
variants that at times borders on fusionwear. The point is whether we
Indian brands will find the future to be disruptive - with foreign
entrants and with a consumer who is constantly pining for more choice.
Indian brands have upped the ante as far as quality is concerned and
across all categories, Indian-made premium products are taking the
fast fashion foreigners to the cleaners. And this has improved over the
years for Indian brands. Take the example of Thailand where the best
departmental stores see success in very powerful local brands that can
match the quality of European brands. And foreign brands have existed
in Thailand for over four decades. The foreign influx in many categories is restricted to power brands
only. You can name those within the limits of the digits on your hands and feet.

2. Where Indian brands underestimate themselves is their ability to adapt to trends, and to bounce back. We
tend to be lemmings that buy into seasons like the West, and ride the full price-deep discount
phenomenon that the ERP implementations of the departmental stores pushed us to believe in.
Let's face it! Two-thirds of India does not care about seasons; we are a tropical country. The less we worry
about seasons, the better we can price our products and also evade the high-margin, high-discount cycle
that disrupts our cash cycle as well. The other key factor that affects the landscape is the distribution
matrix: independent stores, wholesale, department store concessions, and online.
The shifting sands of retail
Mall rentals are easing, and suddenly there is ample space in retail available at a reasonable price. Only
the very brave are building malls. There is a white space to be exploited in the independent store space.
Departmental store spaces are getting crowded. In
womenswear, more space is being allocated to
westernwear and the brands introduced over the last two
years have increased. However, store chains have wizened
up and are trying to appropriate space for their own
private labels, and also rationalising the brands. This will
put demand on higher trading densities while continuing
to increase the number of options available for each brand.
There we are - caught between the devil and the deep sea.
Wholesale business with the local multi-brand stores in
any region of the country has stayed obstinately straight like the Indian kirana stores have. Brands doing
wholesale have rarely blinked, and their cashflow streams have been assured and are growing each year. It
is time that departmental store brands too look at the wholesale trade with variants of their own brands.
Finally, to the perceived disrupter of the ecosystem: online retail. There are many upstarts in fashion that
have created entire markets while running a small workshop of less than 500 square feet. However, for
the widely distributed pan-India brands, the e-commerce opportunity has been 10- 15 per cent of the
market. This metric changes suddenly when it comes to discounted products. Online sites have been
gateways for liquidating unsold products and are likely to remain extremely strong players in this space.
Very few brands claim to have more than 30 per cent of inventory sold at full price online. The skew of
consumption online is still in the metros and mini-metros, which is why the media spend on billboards by
sites are centred around these cities. Personally, I do not think the online euphoria will last. It'll not be
long before online players start targeting market share rather than grow the market, and we shall see
another version of the 'Cola-Wars'.

3. Problems and disruptors
The product development cycle is an area where Indian brands really
need to improve. In India this takes months instead of weeks.
Developing programmes with mills in India is a tedious exercise.
Clothing job workers can be unreliable on delivery schedules, with
absenteeism varying with weather, power availability, festivals,
holidays, wedding seasons and the like. World Company and Uniqlo are
fine examples of companies that exert extreme control on the entire
process - from design and fabric to the production of the garment. An
integrated approach can only happen if all stakeholders are in
alignment, and this has been an issue in India.
On the consumer side, brand loyalty is more likely to decline than grow. The main reason is the similarity
in the offerings between brands and their overall proposition to customers. Much as I would like to
believe that customers will get more quality conscious, the proliferation of fast fashion brands proves
otherwise. Hedonistic consumption of disposable fashion will continue to grow. This is now the excuse to
lower the barrier on quality however.
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