E-commerce boosting apparel sales

The e-commerce business has brought a revolution in the shopping model of India. While the online apparel category continues to top the list of high performers in e-commerce, a study by Technopak Advisors, a consulting firm, reveals this segment

will now grow almost ten-fold to nearly Rs 7,000 crores by 2015 pushed by Gen Z who already number 7.4 million. Gen Z interestingly known as the Net Generation has been held responsible for the increase in sales of garments on the internet and making e-tailing a favorite spot for private equity investments. In the last two years, the Rs 650 crores garment e-retailing business on the internet has attracted investments worth $70 million i.e. 40 per cent of the total funding Indian e-retailers bagged during the period.

In fact, the recent inflow of private equity investment firms into many garment start-ups is an indication that the apparel e-tailing platform is reaching a tipping point fast. This proves that e-commerce in India is riding on a robust model and a positive consumer response. For instance investment giants like Tiger Capital, IndoUS Venture Partners, Helion Venture Partners, Sequoia Capital and Accel India have invested in the range of $5 million to $52 million in portals like Letsbuy, Flipkart, FashionAndYou, Yehbhi, and Snapdeal. Apart from selling apparel, these e-retailers offer everything from gadgets to diamonds and shoes to stationery. They are not leaving any stone unturned to woo their customers by keeping no restrictions on opening or closing hours.

Among big cities, consumers in Mumbai topped the chart in doing online shopping followed by Ahmedabad and Delhi. However, shopping on the net is gaining traction with consumers beyond metros and Tier I cities as well and the emergence of simplified e-commerce business models indicates that e-commerce sites are gaining momentum across India. So far sites like SnapDeal, Deals and You, FashionAndYou, Flipkart, Homeshop18, Rediff.com’s DealHoJaye and many others have come up with India-specific propositions. Apparently these sites are looking beyond metros and Tier I, II and III cities and towns. Deals and You, a group buying portal which has a mature user base in the age group of 25 to 34 as compared to its competitors in India, does business across 60 cities. Homeshop18 ships its products -covering 450 well-known brands and seven million SKUs -across 3,000 locations. It boasts of 1.4 million unique visitors. Naaptol, a VC-funded company, is currently seeing 70 per cent growth coming from beyond the metros. Recently the company launched NaaptolClub.com, keeping in mind the need to sell fashion apparel, accessories and home decor products from top notch brands. Rediff.com’s DealHoJaye, covering 40 cities, offers region-specific discounts. FashionAndYou swears by its success in non-metro India with designer apparel.

Further 3G and 2G facilities have given the world a smooth internet access. With 214 million users accessing internet on their handsets, there is nothing to stall the momentum of online shoppers. The current generation doesn’t feel the need to drive to a crowded mall or navigate through the entire mall to buy just a tee shirt. Rather it feels it’s more convenient to shop at home and get home delivery.