Flipkart to craft identity independent of its platforms, Myntra and Jabong

If one untangles the data jumble that marks the story of online shopping in India, the numbers that jump off the screen are those around fashion. With 35 million Indians buying their fashion and lifestyle requirements online, the market currently stands at around $4 billion (Rs 260 billion) and is estimated to touch $15 billion (Rs 975 billion) in five years according to a recent research report by Flipkart. And this is why the retailer is stitching up its own fashion story, independent of the two fashion platforms it owns, Jabong and Myntra.

Rishi Vasudev, vice president Flipkart Fashion, says that they are the leaders in the category with a market share of 35 per cent plus. “We are working to extend the lead and control 50 per cent of the pie by 2023,” he adds. 

The online fashion shopping platforms (exclusively for fashion unlike Flipkart, Amazon) in India, Myntra and Jabong, are both owned by Flipkart. Yet Flipkart is keen to define its own brand identity in the segment, not only with a host of established and exclusive brand tie-ups but also with a curated private label collection. It has launched five private labels over the past year and is looking to drive exclusive label partnerships with global brands. Vasudev says, “A key tenet of Flipkart Fashion’s strategy is to tie up with key brands and get them exclusive to the platform.” Exclusivity helps create a unique selection and maintain a strong handle over the pricing strategy. 

Apart from the growing popularity of online fashion as a category of purchase, Flipkart’s focus on fashion is also driven by its desire to expand its customer base. Fashion products work as bait; priced lower than electronic goods and furniture, they help first-time shoppers test the online waters. Once trust in the medium is built, e-commerce platforms believe, customers venture deeper and open their wallets wider. Flipkart says that its “new customer” base shot up by 42 per cent (February 2018 over January 2017) and the surveys showed that there was shift in perception among customers with respect to trendiness and relevance.

Fashion also sees a customer returning multiple times to the platform, thereby serving up opportunities to create brand stickiness. On an average a Flipkart fashion customer spends up to $30 a year on the platform over three visits the data show. Vasudev says that Flipkart has a large customer base on the consumer electronics front, especially for mobile phones. But customers don’t buy phones multiple times a year. Fashion brings in repeat visits, drives up transactions while also helping customers make their entry into the Flipkart ecosystem.

The growth of the online fashion category in India has been marked by a surge in private labels. Owned by the mother brand, these allow e-commerce players to create a storefront with something for everyone at every price point. Flipkart has private labels for women, men and children, all labels positioned as affordable fast fashion and offering clothes, footwear, bags and accessories. Myntra is marketed for the mass premium consumer segment and Jabong for the premium high end consumer. 

“Flipkart consumers demand fashion which is popular and accessible in their budget,” says Vasudev. The key idea is to be aspirational yet affordable, he adds, clarifying that they are keener on providing affordable options rather than curating or customising as the other platforms do.

Last year the segment witnessed a gross merchandise value (GMV) of $1 billion and Vasudev says he is keen to close at $1.6 billion this year. Footwear is among the highest selling items on the platform. “At the end of the day, the Flipkart ecosystem gains because with three different ranges of offerings across Flipkart, Jabong and Myntra we grab a lion’s share of the market,” he says.

However the question that many are asking is how do brands craft their own identity within the multiplicity of brands and platforms that they operate in? The idea is to offer products at price points so that they don’t compete with established brands but offer consistent quality.  The aim for many is to make the platform identity synonymous with that of the private label. While there are risks involved in such a strategy, Flipkart says that it keeps a sharp eye on quality and design parameters.

The private label team is led by eight designers among a host of product development and sourcing members. Additionally, Flipkart accesses its huge database on customer purchase cycles to bring new designs faster instead of waiting for the traditional design development cycles that brands follow. Private labels are positioned to get at least 3-5 per cent market share of each vertical said Vasudev. 

Getting multiple brands on the platform is just one part of the strategy to increase the range of products on the platform. The difficult part, says Vasudev, is building customer engagement and help them discover the products. “People can discover what they want without going through our inventory, through various channels where they discover trends,” he says.

Flipkart is also working on the user interface; for heavy browsing shoppers (mainly women) it has a rich media based experience that brings out top trends and curations based on topical events and global fashion trends. The platform is also engaging with brands to help them understand what buyers think of them and where they can offer more. For example it has partnered with Peter England, Wrangler and Puma to develop exclusive products. The idea is to develop the right mix for every customer.