How do you see lingerie market is evolving in this country? According to you, where this market will stand in terms of growth over next five years?
Lingerie is seen as a utility product because it is a daily necessity. Though this market is largely unorganized but maximum growth is coming from the organization of the unorganized market. If we look at market share of unorganized ‘product’ and ‘distribution’ separately, then the product would be about 77%, and distribution constitutes 95% market.
Currently, the size of lingerie market is around 25,000 crore and growing anywhere between 15%-20% y-o-y basis since last seven-eight years. And, this market is projected to grow at least 15% over next five years. The market is poised to touch about 30,000 crore figure over next couple of year. Among the overall market the share of premium segment would be about 23%.
According to you, what could be possible challenges someone can expect while establishing a lingerie brand in India? Can lingerie business see a brighter shine in small town markets as well?
When you are looking to establish any brand in India especially in apparel segment then there are many challenges to deal with. I think biggest challenge now is, consumers have become less forgiving and with the influence of social media ‘feedbacks’ are widely published and read by many which was not the case earlier. And with the advent of e-commerce, the consumers have access to so many brands not only Indian but international as well; hence, the survival among the throat cut competition is tough. Despite all this, there is a tremendous opportunity to cash in on if someone is able to do it in the right manner.
If we look at the industry, India is a very new market for organized players. Even, the journey of oldest players is not more than 10-12 years old. There are many bottlenecks to win over especially for upcoming entrepreneurs, first and foremost, lingerie is a very technical product, the manufacturing process requires very high quality functions, and an efficient supply chain is yet another important element of entire product development cycle. Presently, fulfilling all these parameters are extremely challenging. Moreover, it is a herculean task to establish a manufacturing facility in India, and main cause is dearth of skilled workforce. The requirement to manufacture lingerie is more specialized versus the apparel.
India is never been a large exporter of lingerie items. Though, the things are changing, but India is quite far to compete with China or Sri Lanka. These two countries are globally known as largest hub of lingerie manufacturing. It would take some time before we developed understanding of manufacturing and would be able to make high quality products by own.
As per my experience, tier 2 market is actually more brand conscious than the tier 1. Metro consumers are evolved to the point where they are more concerned about the product itself; whereas, tier 2 markets are always been more brand conscious. The same trend has been seen in the multiple categories of fashion.
How do you see your journey so far? Pretty Secrets started as pure play online then you moved to offline stores? What made you to go through this shift?
I was into lingerie business more before the Pretty Secrets was launched. I used to run a brand business which was largely offline. I never look business as a distribution channel. We are not looking as Pretty Secrets as online brand or offline. Our focus is to make good products along with decent brand building exercise, and make sure it reaches to consumers by having a robust supply chain to match with. For us, the distribution is secondary, though, we are available at all distribution channels, but it is consumers’ discretion where they want to make purchase.
How do you plan to grow your exclusive network?
We have already tied up with all leading large format department stores such as Globus, Future Group led Central and many more. Apart from our exclusive website, we also retail via shopping app. All the leading marketplaces such as Jabong, Myntra are yet another distribution channel for us. Moreover, we have just started our exclusive physical presence by launching the first store in April this year. We already have around 18 stores by now, and we plan to have 30 stores by mid January. Offline is relatively new channel for us, presently, we are working with around 300 retailers the target is to reach at least 1000 retailers pan India. We are heading towards an even split between online and offline.
What is ratio of returns in this category?
In online space, the return rate of lingerie as a category is less than apparel. There are two reasons for same, first, certain products can’t be returned due to hygiene reasons. Second, lingerie is sort of private product and many customers tends to feel shy of getting it returned.
Any plans to foray men’s category?
No such plans for now.
Which is your largest category in terms of value and volume?
In terms of value, the largest category would be even spilt between bras and nightwear. And, in volume, it would be panties.
Going forward, what are the plans to foray into luxury and premium space?
I cannot comment anything right now. We are looking towards premium lines but nothing concrete has done so far.
What is your best selling price point?
Our average selling points within bras is Rs 600.
Any comment on your manufacturing facility?
We work with factories located outside India, largely China and also Cambodia, and all the designing happens in our office located in Mumbai.
What are the plans to raise more funds?
We have already raised multiple rounds of private equity and venture capital. And, as the company will grow we may raise another round of funding. We are on track of growing over 100% this year and we are looking to keep up that high growth till next three to five years.