When Arianna Huffington, the founder of ‘The Huffington Post’ said “Learning to code is useful no matter what your career ambitions are” – she was talking about how technology today is inevitable. Everything from education to food, entertainment to business and communication to healthcare is driven by technology. Today, whether you want to buy a sandwich or go on a holiday the only thing you need is a mobile phone and you can get done in a matter of seconds. Some would argue that Technology has made us lazy, but then there are others who would look at it as prioritizing the more important things in life by saving time off repetitive menial tasks.
The impact of technology has been immense and one industry it has revolutionized over the last few decades is retail. This is an industry that thrives on consumerism (which has been on the rise for the last few decades). In retail, the three major components would be: Pre purchase (procurement, inbound supply chain), Merchandising (point of sale, customer acquisition, selection, shopping) and Post purchase (customer service). The first problem technology helped solve was the Pre-purchase. This was where you saw the biggest retailers of the world (Walmart, Tesco etc.) use / embed technology to bring optimizations and efficiencies to their supply chain. The use of technology here is mature with majority of the P0 problems solved.
The next part and one that’s currently being solved for is Merchandising. The move from offline retailers to ecommerce has been the name of the game for the last 15 years. Amazon grew from a small online book store to one of the biggest retailers in the world. Slowly and steadily every category of product has found e-commerce as a way to reach a wider audience. Some of these have been seamless, whereas some have required a lot more problem solving. Clothing is from the latter, as here customers still want to be able to try a few outfits before buying one.
In India, Amazon entered in the early part of the previous decade and grew to become India’s largest e-tailer over the last 7-8 years. However, even they haven’t been able to solve the fashion & apparel category effectively. The biggest pain points for customers being:
- Need to try on multiple outfits before purchase
- Trust about the genuineness of the brands being sold online
- Wanting the product in a very short lead time (impulse or immediate event based purchases)
Myntra & Ajio today are India’s largest players in this segment. They have built customer experiences that are tailored to fit the fashion segment. They are marketplaces which have been trying to solve the above by offering:
- Mobile first Experience to ease shopping
- No questions return
- Easing the sizing problem with UI / UX
- Shortening the delivery time (sometimes even shipping within 24 hours in metros)
- Low prices by heavy discounting
They have been successful in moving a majority of the first time buyers to repeat buyers with their no question return. People find it easy to trust these websites and moreover the significant price discounts (especially in India, which is a price sensitive market) has helped their adoption soar.
The pandemic that hit us in the early part of last year ended up being a catalyst for growth of e-commerce as people were know locked at home and started working from home. A new category of buyers emerged, categories such as night wear, lounge wear, boxers grew multi-fold and the only beneficiaries here were a mix of the big ecommerce marketplaces & a handful of D2C brands (The Bear House, Souled Store etc. to name a couple).
These first time consumers over the last 18 months got used to shopping from the comfort of their home and have slowly become regular shoppers. This trend is only going to continue rapidly (especially in tier-2,3 cities as India has the fastest growing aspirational class in the world). While this growth has given rise to newer challenges to solve for, such as: excessive returns, last mile delivery, excessive discounting – the size of the market in India is so huge that the growth will only continue.
It is surely an exciting time to live through and see how consumer behaviour is changing ever so rapidly in front of our eyes. Fashion Retailers who keep up to the growth of e-commerce will thrive, the others will soon be obsolete. Soon, we will get to a point where people will soon start finding newer things to do in the time saved from having to go to a mall to buy clothes.