Two of the country’s top fashion retailers–Ajio and Myntra–have kicked off their end of season sales ahead of schedule as slowdown in discretionary spending by consumers weighs on the market.
The two retailers began their sale season from Thursday, which is a month in advance, given that fashion retailers normally have a mid-year sale at the end of June or early July to liquidate inventory, according to industry executives.
While both Ajio and Myntra have put their best foot forward for the ongoing sale, from offering deep discounts (50-90%) to tying up with top brand ambassadors (Shraddha Kapoor for Ajio and Shah Rukh Khan for Myntra) to ensuring seamless delivery across pin codes, the bigger concern is the curtailment of discretionary spending visible in the market.
Both Ajio and Myntra have not specified when the ongoing sale will conclude, though retail industry executives say it will end in two weeks. Companies such as Trent, which runs Zara and Westside stores, and Shopper’s Stop may start their end of season sales in next couple of weeks, say industry sources.
Shopper’s Stop and Trent were not immediately available for comment.
“A sale season may give a short-term boost to topline but there is a wider slowdown in the market,” says Jaydeep Shetty, a Mumbai-based retail expert and consultant.
“The average ticket size for apparels has come down sharply and the tendency to bargain hunt has grown,” he says.
He attributes this consumer behaviour to financial uncertainty, rising interest rates and the need to save rather than spend money on items that are non-essential.
This point was also made by one of the country’s top apparel companies, Aditya Birla Fashion and Retail (ABFRL), during its earnings call last week. The company said that the impact of the slowdown was more broad-based now than earlier and the propensity to spend on discretionary items was low.
“The impact of the discretionary slowdown is fully visible across all segments of our business. While earlier the lower end of the market was more affected due to inflationary pressures, it now appears to be more widespread,” ABFRL’s managing director Ashish Dikshit said.
Tier II and tier III cities, Dikshit said remained sluggish as inflationary pressures and weak consumer sentiment impacted demand, though metropolitan cities were better in terms of sales performance.
Ajio and Myntra seem to reading the signs too, saying there will be new launches, exciting rewards and happy hours for those shopping on their platforms during the sale period.
“It is a great opportunity for consumers to take their fashion quotient a notch higher,” said Sharon Pais, chief business officer of Myntra.
Myntra has also unveiled a virtual fashion influencer called Maya to help consumers pick the right clothes across 6,000 brands and 2.1 million styles, the company said.
Ajio, on the other hand, says that it expects more than 60 million new users for its end of season sale which it has branded as the Big Bold Sale.
“Over the past editions, the Ajio Big Bold Sale has become a fashion extravaganza. This edition, however, is the biggest ever where consumers can shop across 5,000 brands offering over 1.3 million curated fashion styles,” said Vineeth Nair, chief executive officer of Ajio.
Both companies are using technological innovations to provide a neat and clean shopping experience, tutorials on the best looks of the season and how to achieve it, backed by influencer videos.
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