[Note: This article is part of The Junction Series. We will be covering the RetailTech sector in detail at The Junction 2017 in Jaipur. Learn more about The Junction here!]
With its rich diversity in terms of geography, climate and traditions, India is home to one of the most dynamic fashion industries in the world. While a number of established fashion houses and designer labels from the country have created a niche for themselves in the global arena, a large section of India’s apparel and accessories market is still unorganised – dominated by small and medium-sized businesses (SMBs).
This is particularly true for women’s wear (as per trend analyst Herlien Sabharwal), which is majorly catered to by the scattered boutique market with only 3% of products falling into the branded segment. These small outlets usually employ fewer than 10 workers, many among them often being family members.
The widespread adoption of technology in the country and the encouragement of innovation, by both the government as well as individual investors, has resulted in a great number of entrepreneurs making forays into the world of business. Emerging platforms for fashion have been able to leverage technological developments and gain traction through market innovations.
This evolution has been truly democratic in nature, as local designers and smaller players have also been favoured by the new avenues.
Smartphone Penetration Contributes To SMBs Growth In Fashion
The revolutionary spread of smartphone usage in the country has made shopping incredibly convenient. Customers’ increasing comfort with browsing online for their fashion needs, and the growth of social media has led to a phenomenal change in the country’s apparel segment. SMBs are successfully capitalising on the Indian market’s digitisation by using social media platforms to gain visibility and build an identity for themselves.
Digital platforms hold a plethora of benefits for boutiques, including showcasing their products and services, communicating information such as opening hours and contact details, and advertising to potential customers. Younger customers, in particular, have been more willing to explore lesser-known businesses due to their affordability and personalised nature.
Changing consumption patterns have also led to an increase in discretionary spending as disposable incomes continue to rise, and Tier II and III cities gain more exposure.
Hyperlocal Discovery – The Next Step For Fashion Ecommerce
For startups that focus on building fashion networks, SMBs are a very important category due to their keen understanding of the needs and varying sensibilities of customers in different cities. The boutique culture enables direct end-user interaction, allowing these businesses to offer personalised products and services to customers.
While mainstream social networking platforms such as Twitter and Facebook do help SMBs grow, there is a growing need for dedicated fashion platforms like Roposo that can equip these enterprises with unique features that enable hyperlocal discovery. In order to further democratise the fashion segment, networking platforms should offer much more in addition to the basic features like ‘Directions’ and ‘Call Now.’
Another way forward is for these platforms to organise ‘flash sales’ for SMBs and small ecommerce players. Attractive discounts and promotions offered for a short period of time will help these businesses gain traction as customers will impulsively opt for their products. In addition, online platforms can also help SMBs acquire investment through formats such as crowdfunding.
This is particularly important as the unorganised sector does not have an easy access to capital, forcing small outlets to borrow from the unorganised credit market at high-interest rates.
In Conclusion
To conclude, the unorganised fashion segment in India has been evolving due to a combination of factors. Changes in consumer behaviour and developments in technology have created opportunities for the growth of smaller enterprises.
The scenario has been a win-win for all, with customers being served a wider range of choices and entrepreneurs having access to a widespread network of fashion outlets. Further evolution is sure to be driven by a stronger association between fashion-centric digital platforms and small-scale boutiques.
