Apparel retailing is a success story, thanks to high margins. E-tailing apparels is a different business.
By Prashant Mahesh
Indians love buying apparels. Whichever part of the globe they are in, Indians have demonstrated that they are great apparel-shoppers. Even though many international brands are locally available, they do not miss an opportunity of buying an imported one.Apparel retailing has been successful in India. Thus, it is not surprising that we have success stories such as Shoppers' Stop, Piramyd and Spencers Plaza. In apparel retailing, a retailer has two choices: either to create his own brand or sell other brands. Own brands definitely offer higher margins over non-store brands. Margins in apparel retailing could be anywhere between 40 and 50 per cent.
The moot question now is this: will apparel selling succeed on the web?
Analysts argue that though an apparel website may be great, it is not a substitute for the tactile sensation the buyer enjoys. So apparel e-tailers would have to borrow an idea or two from cataloguers who have succeeded in selling to people who do apparel shopping not at brick-and-mortar stores.
Yes, an e-tailer can successfully sell apparels on the web if he can keep his costs lower compared to a brick-and-mortar store's.
This is possible. For, an e-tailer does not have to carry huge inventories and can cut costs in the supply chain.
That is one reason why cataloguers have been able to deliver the goods. They have the advantage of being used as references or guides to the Internet and they work as a complementary channel for moving merchandise.
Direct mail catalogues can really drive people to the web. A combination of focused merchandising, extended colours and sizes and convenience leads to success.
In apparel e-tailing, effective communication with customers can help lay the foundation for buyer-loyalty. The Askeddie option allows consumers to type in questions and participate in live real-time chats.
A good e-tailing communication can make relevant and enticing offers to prospects and bring them back to the site.
How to win the loyalty of apparel-buyers on the Net? Apparel e-tailers should consider a liberal return policy, offer instant help and provide exciting range of colours, sizes and styles.
Thanks to the popularity of Internet, fashion has gone global. Hence, e-tailers should offer the latest fashion trends from across the globe. For an apparel e-tailer to succeed these are needed: an extensive database and its effective management.
Fine. Things are not as rosy as you expect. Most apparel e-tailers have been slow on the uptake. Pantaloon.com is still under construction.
If you were to visit the other large apparel e-tailer Trent, you can find that he does not have a basic website and only sketchy information is available on the site Tata.com. Shoppers' Stop is just working on its plans to take its shop online.
To be sure, apparel e-tailing is yet to take off in India. However, e-tailers are confident and optimistic. Reason: Indians are used to catalogue selling.
Says Atul Pradhan, executive director of KPMG India: "Buying online things like a white shirt, which is more of a commoditised product, is fine. But, then one should not expect an Indian to buy a designer suit or a sari."
As far as apparel e-tailing in the West is concerned, buyers are found to shop at ease with cataloguers with whom they have had pleasant experiences in the past.
That trend might catch on here in India too. Probably, very soon we might see Indian cataloguers flocking to the Net.