Glad rags and gladder tidings
Fashion sales online are booming in India, with clothes, footwear and accessories now the single largest category of online purchases. A report by Redseer Strategy Consultants found that fashion sales had increased due to a greater number of Indian and foreign brands selling clothes and accessories online, as well as a constant supply of fashion-related content on social media platforms. The report also found that more women were purchasing fashion goods online, and that online shopping was being driven by convenience and trust in the brand.
Indian consumers are driving a boom in fashion sales online. Over the last three years, people are increasingly purchasing clothes, footwear and accessories on e-commerce marketplaces like Amazon, Flipkart and Myntra, as well as buying from company-owned websites and apps such as Urbanic, H&M, Zara and Marks & Spencer, among others. Earlier, mobile phones were the most bought items online but now fashion is the single largest category with a 27% share of all online purchases.
These are the findings of a new report by Redseer Strategy Consultants which says despite a slower growth in the financial year 2023, e-tailing, that is, online retailing, is two and a half times bigger than pre-Covid times.
Mrigank Gutgutia, partner at Redseer, says more women are purchasing stuff online fueling an explosion in fashion sales. Also, the number of Indian and foreign brands selling clothes and accessories online has increased, offering a wider choice across price and product spectrum, he says.
But there are other reasons too why a category which requires touch-and-feel and right fitting has grown so big online.
Firstly, the constant supply of fashion-related content on social media platforms has created both awareness and aspiration, especially, among Gen Z. “Anyone on Instagram today can actually reach the biggest fashion influencer anywhere in the world,” says Rahul Dayama, head of marketing at Urbanic India, UK’s trendy fast-fashion, digital-only brand. “Consequently, the understanding of styling has increased many-fold.” Since its India launch in 2021, Urbanic has put out more than 1.5 lakh pieces of content to grow the market.
Not only is consumer engagement with fashion content higher, influencers help in educating customers on different styles and fits. “Brands do videos which showcase the silhouettes making online purchase decision in the category easier,” Dayama says.
Omni-channel retailer Marks & Spencer too has seen robust growth in online sales. It has its own website and app and also sells on Amazon, Myntra and Ajio. Its lingerie and sleepwear are sold on Nykaa and Zivame, in addition to Flipkart and Amazon. “Currently, the online channels contribute 25% to M&S’s total revenue,” says the company’s managing director Ritesh Mishra.
For M&S customers, shopping online is driven by convenience, trust in the brand, standard sizing, previous in-store experience and easy return policies, Mishra says. Currently, only 30-40% of India’s total (offline and online) fashion industry is organized or branded. The rest is unorganized or unbranded fashion.
Typically, as Indian consumers mature, they migrate from unbranded to branded products. “Fashion was a very neglected segment earlier where people didn’t care about what they wore. That has certainly changed,” says Dipanjan Basu, co-founder and partner at Fireside Ventures. “Their aspirations have grown thanks to exposure on Instagram and Facebook,” he adds.
Fireside Ventures has invested in an online women’s wear brand Fable Street. Basu says they are looking for more opportunities to invest in new-age fashion brands that can scale. He believes people will shop for fashion both online and in offline stores. Though e-commerce will continue to thrive with higher adoption of digital payment systems and increasing comfort with online shopping, “buying clothes and accessories in a retail store works as a therapy and will never go out of fashion,” he says.
Flipkart-owned Myntra, India’s largest e-commerce market place for fashion, says technology is democratizing fashion. Myntra has announced the launch of MyStylist, an AI based stylist expert, to provide customers with styling tips and it offers vernacular search in 11 languages. With the increasing GenZ consumer base, it also launched FWD, a one-stop shopping destination for this target consumer group.
Urbanic’s Dayama says the aspiration to dress well has percolated down to the smaller towns and the young are experimenting more with fashion. That explains why Redseer thinks that fashion, as an online segment, will continue to see robust growth over the next few years. As India’s e-tailing market exceeds $150 billion in GMV (gross merchandise value) in the next 5 years or so, fashion will account for at least $50 billion out of that.