You can?t miss this one. The s.Oliver store that opened in south Delhi?s upscale Promenade Mall last week has a huge entrance that literally sucks you in even as you struggle to take your eyes off violin virtuoso David Garrett plastered on the display window. ?The store is our marketing and advertising point,? says Gaurav Sehgal, COO, s.Oliver, explaining why they decided to convert the huge fa?ade of the store into an entrance and not a window, something most other brands would not have preferred doing. The brand?s fourth exclusive store in India also flags off an ambitious expansion plan?to be numero uno in the premium fashion, apparel, lifestyle category by 2015. The German brand entered India in 2007, the year that it crossed the Euro 1.1 billion turnover globally, in a joint venture with Orient Craft. It took Orient one-and-a-half-years of aggressive negotiation with the brand to get the deal going. And a little ground work too?420-odd pieces were flown in and tested on 600 Indians to check viability for Indian ?size?. In fact, it was one of the earliest entrants in the business of fashion in India ever since FDI was allowed in retail.
The path ahead in India is well chalked out for the brand that recently celebrated its 40th anniversary. It is targeting the 18-34 age group with its formal, casual, sports and weekend fashion categories. ?It takes people by surprise when we say that we will increase our turnover in the next three years by 700%. But it?s rather simple. We started at zero in 2007 and notched Rs 7 crore in 2008. We will end 2009 at Rs 13.5 crore and target Rs 34 crore in 2010. That done, we will notch Rs 55 crore in 2011 and Rs 100 crore in 2012. We have planned well and it?s all about plugging new stores,? says Sehgal. In terms of footprints it translates into 16 points of sale by March 31, including shop-in-shops in Patiala, Jalandhar, Amritsar, Ludhiana and two exclusive stores in Pune. In all, it will be 70 points of sale in the next three years. Doable, yes, if one considers that modern retail is expected to show impressive compounded annual growth rate of 40% over the next five years with a fresh investment of $30 billion. At that rate the market is expected to reach $535 billion by 2013, according to the latest India Fashion and Lifestyle Franchise Report.
?We don?t want to be a snob brand which just opens 10,000 sq ft stores. The idea was to be where the customer is. Our success is not in setting up a store at South Extesnion or GK. We will also make money when we open at locations such as Rajouri Garden, Karol Bagh and Lajpat Nagar,? adds Sehgal. From the 7,000 sq ft flagship at Select City Walk mall to the 360 sq ft space in Model Town, the brand maintains flexibility of approach while keeping other factors constant. The decibel level over weekdays is different from those on the weekends and adhered to across stores. The fragrance and humidity levels are controlled too.
The product mix is tweaked too?the stores in Punjab, for instance, will only have men?s casuals. Also, while the furniture and fixtures in the store are all imported, the average shelf height is kept at 5.7 ft, to match the average height of the Indian male.
Interestingly, the brand opted to keep a low profile in the last two years, inviting criticism that it was a very conservative company, one that wasn?t expanding enough. Today, the same moves are perceived as prudent. ?Despite the huge temptation and the mad rush, we played safe. It was like stock market?stores were doing Rs 2 crore of sales a month. We could sense something was wrong. And we saved money by not spending it,? says Sehgal. The brand resized its store in Bombay and tweaked categories at Select City Walk Store to survive the bust. ?We never closed any store, never fired any staff. Even now, we aren?t just going ahead blindly. We first tie up with a regional retailer, do a small shop-in-shop to understand the market and then plan to open a big store,? adds Sehgal.
And the abstinence has paid off well. The store at the Select City mall in Delhi closed at Rs 1 crore for the month of November and at Rs 1.1 crore in December. The January and February end-of-season sale is expected to rake in about Rs 2.5-3 crore. The brand?s mantra: offering high fashion at a fraction of a cost. It claims to be ?the most correctly priced international brand, at least 10-15% more reasonably priced than any of its competition.? Little wonder that it enjoys a 42% average conversion to walk-in ratio with the average bill summing up to Rs 3,700. ?We want your best shirt to be a Tommy or even Zara. But we want you to have 10 s.Oliver tees,? says Sehgal.
To achieve that, s.Oliver plans to invest heavily in strategic brand building?making its presence felt through Facebook, Twitter, radio channels, a dedicated customer loyalty programme, and cross-marketing promos with cinemas and food joints. Time for the ?brand? to arrive.