Falling GDP growth, increasing inflation, and now the unexpected financial losses due to COVID 19 pandemic have made the Indian fashion products’ consumer quite cautious in his spending. However, as we look forward to entering a more positive phase soon, the fashion industry in the country will have something to cheer about. A favourable demographic dividend with a growing number of young fashion-conscious consumers willing to experiment with both ethnic and international brands, adds to the advantage. Today, fashion goods are not occasion-specific or need-based, but a reflection of personality, aspiration and status.
The Indian fashion industry has come a long way and continues to evolve with the consumer’s growing disposable incomes, confidence levels and exposure to global markets and brands. Being value-driven and aspirational, with rapid changing tastes, the new consumer has driven the fashion retail business to change product portfolios and retail formats continually. The consumer of today is time-pressed but has easy access to technology. This factor has led to online retail gaining importance and already showing signs of growing faster in the future. Online stores will further add to the accessibility of fashion-wear across brands with a comparison of prices, discounts, service offerings, feedback and opinion of consumers, influencing buying decisions. Availability of global brands, discount offers and customized products and creative content will dominate online retail platforms.
Retail technology and digital innovation substantially support creation of new and relevant retail business models, where operational efficiencies and business outcomes are enhanced too. New-age technologies, such as IoT, Data Sciences, AI and ML will not only significantly improve inventory and supply chain management but also provide an understanding of industry trends, changing consumer demands and buying behaviour. Data insights are optimally leveraged for taking timely actions in making the fashion retail business profitable with better product designs and customer experience.
Corporatization of retail is gaining more importance in the fashion products segment, enhancing the retail ecosystem in India. The penetration of corporatized retail into smaller cities too will grow with the adoption of Retail technology, addressing fashion demands there, which is driven by an increase in media reach and growing aspirations among the youth.
Indian consumers are accepting Privately-owned labels, and this segment will grow further and be actively promoted on social media. With increasing internet access, social media is also emerging as a reliable platform to introduce fashion brands by not only acting as an influencer but also as a sales outlet.
Trends already indicate millennials prefer to buy products on snap chat and Instagram. Facebook and Whatsapp are also proving to be good marketing channels.
Capsule wardrobes are gaining popularity with working executives who have time constraints. Growth of digital clothes with digital tailor adjusting the wearer’s picture to the clothes for showcasing on social media or be used as try-on is gaining attention too. Usage of sustainable materials is another factor shaping the fashion segment.
Offline retail outlets will increasingly adopt retail technologies to create innovative promotional strategies and customer experience online and also showcase massive selection, thereby aggressively competing with online stores. M-Commerce is playing a vital role as the majority of mobile users reach out to the retailer website to buy fashion goods. Omni-channel presence of fashion retailers will increase, to reaching out to more customers.
While India continues to present exciting opportunities for fashion retail with global brands engaging enthusiastically with the country, the industry is not far away from challenges.
Some of them include the country’s heterogeneous fashion market with consumers’ diverse tastes, making it challenging to create a retail format that is of near-universal appeal.
Multiple languages and cultural differences add to the challenges.
Poor infrastructure increases the inventory costs with supply chain hurdles caused by bad roadways, thus adding to timely availability of material and logistic constraints.
Human Resource, such as professionals who understand fashion retail are scarce and not well- equipped with the necessary skills and global best practices.
Technological innovation, along with favourable government policies and developments, can provide a solution, a shot in the arm for the fashion retail industry. To remain competitive fashion retail has to focus on innovative marketing and brand enhancement. Indian fashion retail industry will grow and progress only by collaborating with technological developments for innovation, ensuring the customer enjoys a personalized shopping experience. Fashion players have begun to adopt retail technology, creating new business value by restructuring and establishing more profitable business models to cater to the dynamic market.