Indian ecommerce lures brands

04 May 2011

NEW DELHI: Apparel and sports brands like Nike, Puma and Wrangler are enhancing their ecommerce presence in India, anticipating rapid growth in the market.

Myntra, an online retail hub, expects revenues to rise to 75 crore rupees in 2011, as the amount of items on sale surpasses 10,000.

This platform's daily visitor numbers leapt from 4,000 to 10,000 netizens on an annual basis in 2010, and are pegged to hit 25,000 in 2011.

"Fashion and lifestyle is a $30bn market in India," Mukesh Bansal, a co-founder of Myntra, told Business Today. "We want to dominate in the online space first before considering any other category."

Currently, Myntra has signed up 30 firms - a list incorporating Adidas, Disney Kids, Lee Cooper and Wrangler - and Bansal said that room for further expansion remains.

"There are at least 250 brands we can target," he said. "We offer designs from the latest season and we don't sell deeply discounted products the way some of our competitors do."

Sports expert Puma, owned by French operator PPR, is leveraging Myntra in a bid to reflect shifting preferences and habits among its core audience.

"Today, everyone is online," Rajiv Mehta, managing director, Puma India, said.

"Young people, a key target group, tend to save time by hunting for deals online and eventually lead virtual lives."

In an effort to fully exploit such positive trends, Puma may even ultimately launch exclusive lines through Myntra.

Nike, one of Puma's major rivals, has tapped the same site, in the first instance as this strategy yields access to a broad population.

"Myntra gives our distribution an additional edge beyond conventional multibrand outlets and large retailers," Sanjay Gangopadhyay, marketing director of Nike India, said.

Elsewhere, eBay's local arm recently announced a tie-up with partners including Adidas, Puma and Reebok to sell official apparel from the Indian Premier League cricket tournament.

"The e-commerce model bridges the supply and demand gap. The distribution of large brands is not as good hence it makes sense to buy it online," said B Murali Krishnan, senior director, marketing and products at eBay.

Research conducted by eBay revealed buyers in 3,296 cities across India made ecommerce purchases last year.

Some 2,234 metropolitan centres within this total were from the second and third tiers, showing the enormous reach delivered by the internet.

Neha Gupta, a senior analyst at Gartner, predicted that rising affluence, and the climbing penetration of devices like netbooks and smartphones, would exert a beneficial influence going forward.

"The buying power in smaller towns has increased and hence these places are not a second option for ecommerce players anymore. Once the stage is set, it will foster growth," said Gupta.

The experience of deals site Fashionandyou, primarily aimed at female shoppers, equally suggests the web carries considerable potential.

It boasts 1.2m members living in 300 towns and cities, and able to choose between offerings from over 100 designers.

"Women's aspirations in metros and small-town India are similar," said Pearl Uppal, chief executive of Fashionandyou.

"But due to fashion access being limited in small towns, online buying options become attractive - 35-40% of our sales are from small-town India."

Data sourced from Business Today, Times of India; additional content by Warc staff