Retail not-so-easy offline

Retailer Media caught up with Sidharth Taparia, CEO & Founder, VoxPop Clothing – a brand that provides authentic licensed products and has partnerships with Walt Disney, Warner Brothers, HBO, Tom and Jerry, Barbie and Yash Raj among others.

Taparia is of the opinion that it is not-so-easy for licensees to retail offline, reason being piracy, pre-conceived notion of distributors and loopholes in distribution channel.

 What is the current scenario in licensing kids’ apparel segment?

Licensing for kids’ apparels obviously has taken off. We got a number of brands which have been at the forefront of licensing brands for kids’ apparels. Disney, Warner Brothers and Viacom 18 are some of the prominent brands which have done good work around kids’ licensing along with some local brands such as Green Gold Animations for Chhota Bheem. There is obviously an opportunity in the market which is large, but I think it has still scratched the surface. It’s primarily because the larger players with larger vision have taken the license for kids’ apparel.

Mostly, some smaller apparel companies with limited distribution who have taken licenses have not been able to build it very large. But, given the challenges of distribution, we need someone to take on the kids’ licensing which has very strong footprint in terms of distribution that can build a category significantly. Clearly, an opportunity is there, because the brands have strong resonance with TV and movie content hence, providing a great platform for licensing.

What are the other challenges a licensee faces?

There are no challenges from the end of licensors as they support their partners significantly in terms of market, content, design, and global inspiration. I think that the challenge in India is the distribution as distribution in apparel industry is larger than others because there are not many doors which are available in offline Brick & Mortar world. The mom and pop stores don’t have the kind of space for license merchandising.

That’s why; Voxpop has taken a different route where we believe that distribution is a challenge in India. So while we took licensing as a theme, we built it as online platform where we can offer proper choice and access to our consumers across the nation. It is still a large challenge with offline distribution.

Is pricing a major concern in this segment?

No, I don’t think so. Pricing is a challenge in the minds of the brands and the distributors. I don’t think that consumer is that sensitive to price, if you design good products with superior quality. I am not saying, you need to overprice given the comparative landscape, but pricing is definitely not a challenge.

How is the market for licensed kids’ apparels in Tier II and Tier III cities? 

Talking about our business, we sell about 55-60 per cent of our merchandise in top 10 cities and remaining 45-40 per cent is sold in Tier II and Tier III cities. So, a pretty large portion of our business is directed through Tier II and Tier III cities and that’s primarily happening because online gives us access.

I had to do this in offline world, it would have been quite difficult because of not having the right shops in Tier II and Tier III cities, distributors trade having pre-conceived notions of what products work and what does not, and pricing and piracy being a challenge and many more. That’s why most of the offline distributors do not take these products because they believe that it won’t work and product gets stuck at the distributor’s level. It doesn’t even reach to the consumers.

Is there any demand difference between Tier I vs. Tier II and Tier III cities?

Demand is there universally because TV is there in 65-70 million households in India, and kids in all tiers have exposure to cartoons on TV. The challenge is that a kid in tier I has more affinity to the brand and has more exposure to the characters than a kid in tier II city. This is being reflected in their preferences as well. For instance, a kid in Mumbai picks avenger or Spiderman merchandise, while the one in tier II city goes for Chhota Bheem. Though overall, the global characters popular from decades have a more firm base as compared to other characters.