Looks like the e-commerce industry is taking a leaf out of the pharmaceutical industry. A decade back, we saw lot of mergers and acquisitions in pharma sector and the consolidated three to four major players were battling it out for numero uno positon.
As is the case in e-commerce insudtry now. Amazon, Flipkart and Snapdeal are the three major players in this sector in India. Players such as Fashionandyou, Jabong and Yebhi have good market share, specifically in apparels, but if they are not able to consolidate their position by involving more investors, they will be bought, too. Already we are hearing lot of offers being made to Jabong.
Indian e-commerce market is estimated to be around $3 billion so when corporate giants such as Azim Premji and NR Narayan Murthy invested in Flipkart and Amazon respectively it didn’t came as a big surprise for me.
No doubt Flipkart, who also bought Myntra recently, is the biggest player as of now, but Amazon has done exceptionally well by clocking $200 million sales in a very short time — it took Flipkart seven years to reach this level.
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The online shops are obviously trying to piggyback on fashion industry as well. Quite recently, Amazon became the title sponsor of Indian fashion week, organised by Fashion Design Council of India. The design council has the biggest pool of designers in the country with more than 300 registered designers. This could be a win-win situation for designers as we will get the marketing, distribution and logistic support of players like Amazon to reach to the masses, especially in the ready-to-wear (RTW)segment.
The RTW market is still very naïve in the Indian fashion industry, which is still dominated by bridal and ethnic wear. So this could be the best thing could have happened to pret fashion. Yes, initially it will take time, as the price points, quantities and quality checks are likely to put a dampener. But one has to be ready for the grinding to reap benefits.
Jabong and Myntra are also getting involved in a big way. The recently concluded Jabong online fashion week was a case in point. Although sales figures have to be seen, the initial buzz was undoubtedly good. Similarly, we saw Myntra doing Mytnra fashion weekend in Mumbai last year, which also got a lot of attention.
Though all these efforts are still new and it will take time for the actual benefuts, one thing is for sure: these steps will diminish the line that exist between an established designer and an upcoming one.
There have been concerns from some financial experts about the losses these e-commerce companies are bearing — by introducing crazy sales weekend, for instance — in order to topple each other This is the reason I feel that only the big players will be able to survive.
Personally though I am quite divided about this development. The MBA graduate in me is a bit apprehensive: there will be cut throat competition between the major players. But as a designer there will be lot of opportunities to come. And as a consumer, I feel these are the best days for the shopaholic in me.
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