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Fashion goes local in India

News, 24 December 2015

NEW DELHI: More global fashion brands are opening stores in India and reporting successful initial trading but continued long-term success will depend on creating products designed for the local market, according to observers.

One of the world's largest fashion brands, Sweden's Hennes & Mauritz, better known as H&M, opened its first store in India in October and was reported to have made sales of Rs 1.75 crore on the first day.

And US teen brand Aeropostale has claimed daily sales of Rs 8 lakh since opening a New Delhi store in November.

The novelty factor will play a role in these encouraging early figures, but global brands that benefit from economies of scale will have to adjust their approach to take full advantage of what is expected to be a booming Indian apparel market in the near future.

As the Business Standard pointed out, H&M's current seasonal sales strategy isn't going to work in a location like Mumbai: "faux fur and woollen overcoats just won't make the cut".

"Having a localised, Indian-specific collection is very important," said Gurpreet Wasi, principal consultant/retail business at research firm IMRB International.

This is something businesses themselves recognise – and not just those operating in fashion. Consumer electronics brand Panasonic, for example, has focused on the localisation of products and technologies to suit the preferences of Indian consumers, while fast-food chains have been quick to localise their menus.

"We are working to create products which we think are relevant to the India market and the fashion preferences here," explained Sumit Dhingra, COO, Gant, Nautica & Aeropostale.

Young people especially are more exposed to these brands because of the internet and e-commerce, but physical stores are regarded as playing an important role in delivering a tactile experience.

"Many of our customers love to experience the brand, and hence we will continue to open physical stores," said Dhingra.

Data sourced from Business Standard; additional content by Warc staff