Fashion, grocery lead Indian etail surge

28 November 2014

NEW DELHI: Fashion and grocery are important categories in the fast-growing and fast-changing world of Indian ecommerce, where further acquisitions and investments by leading players are in the air.

Amazon is in talks about buying online fashion store Jabong, which has just reported a trebling of revenue in the first six months of the year. And Flipkart, which acquired rival online fashion portal Myntra earlier this year, has joined up with publisher Condé Nast to target fashion conscious shoppers with unique content.

The 'Flipkart Fashion Files' will feature a range of exclusive fashion diva/celebrity interviews, trend boards, brand and product stories along with lifestyle articles. Mukesh Bansal, head of fashion at Flipkart, described the Files as "a true combination of high quality commerce and content which will add a new dimension to our fashion category".

While the fashion etailers have yet to record any profits, the opposite is now true of the country's online grocers. The Economic Times reported Ganesh Krishnam, director at Bigbasket.com, as saying the business would be profitable this year, just three years after it was set up.

The convenience aspect is particularly useful to Indian consumers, according to Krishnan. "You can go shop at a Walmart or Tesco in the US and UK and they have parking. You can take the shopping carts right up to your car, so it's smooth," he said. "In India, none of this exists."

In addition to their lower overheads, online grocers have the capacity to grow more quickly, not being held back by the need to find prime sites and then build stores. Bigbasket.com, for example, currently operates in Mumbai, Bangalore and Hyderabad, but plans to launch in Pune, Delhi and Chennai in the next three months.

The whole online industry could get a further shake-up when Alibaba steps up its investment in India. Jack Ma, founder of the Chinese ecommerce giant, has signalled his intention to diversify Alibaba's business interests in India.

He explained that there were already 1.3m suppliers listed on Alibaba's Indian site. "Our platform was never designed for them (Indian SMEs)," he said, "but their capabilities in taking advantage of opportunities is fantastic, and we have to build platforms to ensure more of them use it."

Data sourced from Economic Times, Financial Express; additional content by Warc staff