There’s a beeline for India – from publishers of magazines and newspapers to manufacturers of garments and textiles. Not quite without reason – its ever-growing affluent section is bigger in numbers than many European nations put together.
If you care to look beyond the obvious, you will realise those making this beeline have not just been taken in by speculative hype alone. Numbers scream realities, and the numbers indicate that the Indian fashion market is huge, it is growing, it is vibrant. The rich are getting richer, and the number of the rich is also increasing at an alluring rate. This lure is for all those who see India as the promised land for fashion and retail.
So what is it with fashion in India? What is it with sportswear in this country?
India is a country whose fashion lore warps back in time to the Indus Valley Civilisation. The ruins of Harappa and Mohenjodaro bear testimony to drapes, jewellery and ornaments that were ahead of their times. Too chic and funky for their times, many may contend. The times, actually, haven’t changed much. What has, is the wallet share of Indian consumers that splurges on fashion. A society that was by and large savings-centric has, in the face of growing consumerism, no qualms surviving on EMIs or equated monthly instalment for every purchase they make – be it for the home they want to buy to the designer dress or bag they wat to flaunt. As incomes rise and as do disposable incomes, it is the devil-may-care, upwardly-mobile urban consumer’s spend which is helping the Indian fashion industry boom like it never had.
The clothing and apparel segment, not surprisingly, emerges as the largest organised retail category and stands at Rs 1224 billion (2007), if the India Retail Report 2007 is to be referred to. In another two years time, this number is projected to climb up to Rs 1,715 billion. And yet, in this very big number lies the future of the market – less than 20 per cent of this market is organised. Add to this the fact that almost two-third of the 1.2 billion Indian population is below 35 years of age, and you are likely to conjure up something of an El Dorado in your mind.
India is now the fourth largest economy in terms of purchasing power parity, after the US, China and Japan, and is rated among the top 10 destinations for foreign direct investment (FDI). Consumers are driving retail growth and private consumption growth chips in with more than half of the GDP growth. The cascading effect on the country’s textile and apparel industry is only, but, natural. Apparel now has the largest share of the modern organised retail in India – that would be one-fifth of the current market of Rs 56,000 crore. And according to Technopak India Textile and Apparel Trends 2007, this will grow at a constant rate of 20 per cent over the next four years.
The wallet share that indulges in fashion has come about only through one elementary factor – changes in lifestyle. And when you deal with lifestyles, you cannot possibly keep yourself restricted to one facet of this change – you cater to all lifestyle needs. Brands have been quick to realise this and react accordingly. What you have in the bargain is not only an expansion of the product portfolios, you also have foreign brands flowing into the country.
The market that was constrained to dour formalwears and opulent occasionwears till the turn of the century underwent a far-reaching change as the new millennium rolled in. The seeds of liberalisation that were sown in the 1980s began bearing fruits – the Indian economy became one of the fastest growing ones in the world. The old order changeth and the feelgood factor yielded to the euphoric look-good factor.
People no more wanted to be seen in only what they wore to office or at occasions like weddings. What began was the trend towards wearing casuals, indulging in luxuries. But then these so-called luxuries were not mere luxuries in terms of affordability. People needed them, these became items of dire necessity. The notion that a luxury item is one that you can hardly afford no longer holds good. The bar has been raised.
The choices that landed up in the lap of consumers also spelt variety. You had variety because there were people around to deliver – fashion designers. Till the fag end of the last century designers remained an inaccessible and secluded lot, what with their high-priced coutoure. The Fashion Design Council of India (FDCI) took designers out of their boutiques and placed them in the glare of the mainstream media. Suddenly, fashion, and fashion designers too, were in. Fashion weeks being were looked forward to.
Indian designers, barring a Manish Arora, so far haven’t taken the ramps in the West by storm, but these are early days yet. The fashion weeks are barely a decade old and designers, by and large, still lack the systems, human resources, and money power to rapidly scale up operations. It would be premature to pass sweeping judgments and dismiss them right away. While the fashion weeks did their share of the good work, the split into a spin-off week may not be in the interests of Indian fashion.
The talented ones of yesterday did not have the wherewithal that upcoming designers now have at their disposal. A country of 1.2 billion people cannot be shorn of talent. What these designers lacked were enough liquid cash and people to give the right directions. This has begun changing and the effects are there to be seen. As the National Institute of Fashion Technology (NIFT) takes more care in nurturing talents, designerwear is increasingly becoming corporatised.
The Satya Paul brand has emerged as a pioneering name with its parent company Genesis Colors promoting Puneet Nanda and thereafter taking on names it believes in. Mega ventures, however, have not been mega successes for there have been high profile failures too. The multi-designer Be: brand from the Raymond group and Buzz from Shoppers’ Stop failed to click, and after an ephemeral existence, closed shop.
The target, the consumer
The prime reason why the Indian market comes across as irresistible is two-fold – it is young and it is affluent. In other words, its sheer size as well as the quantum of wealth that has been streaming through it are seen as the beckoning factors.
India, last year, had 83,000 individuals who have a liquid cash of $1 million. By next year itself the number of millionaires here will jump to 134,000. India has more consumers for luxury goods than the adult population of many countries. In 2006 there were a million of such people in India; this number is expected to treble in another two years. According to the survey Indian Consumer Trends 2006-07, the highest spends are on jewellery, clothing, digital accessories and timewear, cosmetics, and skincare. The per capita annual spend on luxury goods was Rs 400,000, roughly a tenth of their annual earnings. Big amount that, and growing bigger by the day.
Growing numbers do not just present an opportunity, they are a challenge too. The challenge is primarily about scaling up operations enough to meet the burgeoning demands. The yearning for apparel and accessories is no longer confined to the big metropolitan cities – the difference in private consumption between households in the big cities and relatively smaller towns has narrowed down to a paltry Rs 25,000. In 1990, for every US$100 earned by an Indian villager, an urbanite made US$82 more. Today, the difference has dipped to US$56. This disparity is expected to taper down still.
In October 2007, India had about 200 million mobile phone users. In another three years, the number is slated to double. The proportion of rural households incurring expenditure on telephones jumped from 5 per cent in 1993-94 to 32 per cent in 2004-05, there was a rise from 25 per cent to 63 per cent in the urban areas. The number of households owning cars, motorcycles and television sets has increased – by 400 per cent in the same period. The number of people owning motorcycles or scooters recorded a 300 per cent jump. The affluence is spreading geographically as well.
It is these very arbitrarily culled out facts and figures that present the challenge from a different perspective – there is no way one can generalise the Indian consumer. Since one cannot use the same yardstick to measure all Indian consumers, one needs to have a wide array of products to cater to the market – there has to be everything for everyone. The advertising/marketing strategies too need to be as varied. After all, the productlines and marketing lines need to keep a number of segmentation features in mind – right from the conventional factors like age and sex to ethnicity and traditional values.
It is probably easier for retailers to do that since they can assort products from a number of companies. But for manufacturers, that would be a tad difficult. Hence, the need probably to either specialise or cater to specific wears. Those in the business of fashion have to tread that thin line – between the risk of spreading oneself too thin and catering to the needs and demands of Indian consumers.
This scenario also presents a challenge for market researchers. There is a need for accurate numbers about consumers and a break-up down to the last demographic and geographical detail. Numbers need to be correct or else you will go with the deluge.
One needs to make little more than a passing mention of the sportswear scenario. The unisex apparel market in 2006 was barely 7 per cent of the Rs 1135 billion fashion market, according to an IMAGES Business of Fashion research on sportswear/denims/tees. Active sportswear was the top performer with a 37.6 per cent growth in value terms over the previous year and 16.4 per cent in volumes. Within the next two years, the value growth of this segment is expected to dip to 4 per cent. The volume growth, however, will continue – to over 20 per cent. This push will come from the lifestyle trends referred to earlier in this article, and also the inherent need for brands to tap into this category which they did not fully exploit all these days.
What’s happening?
Shopping destinations are choc-a-bloc with shoppers, and these centres are bursting at their seams with the people flocking in to shop till they drop. The shopping space has increased – from 2 million sq ft in 2002 to 21 million sq ft in 2006 – but it never seems to be enough. A staggering 700 million sq ft of quality retail space is said to be the requisite projected figure for 2011. Prospects themselves are breathtaking.
Given this backdrop, wouldn’t it only be natural if the rentals in prime shopping locations were to jump? That it did – rentals doubled up in 2006 alone compared to the figures the previous year. Two years from now and the retail space across the country is expected to see further investments of Rs 200 billion.
The retail boom is there to be seen everywhere, but one can still pinpoint some places as to be the most “happening.” Let’s look at only four of these hubs.
The most “happening” of them all is Select Citywalk, an upscale shopping and leisure destination in the heart of South Delhi, arguably a region whose catchment area is the most affluent in the Indian capital. Housing, some of the most exciting Indian and international brands under one roof, Select Citywalk combines luxury and high street shopping, together with destination cafes, bistros, restaurants, and bars. The 1.4 million sq ft development’s city centre feel is marked by a 90,000 sq ft outdoor, landscaped plaza, rich with plants, trees, water bodies and specialised lighting, imparting a rich and soulful urban space, for relaxation and entertainment. The complex itself is spread over six acres and also houses serviced apartments.At a time, over 2000 individuals can park their cars during a visit to the mall which has as many as six anchor stores. It is the designing and planning that has made this mega mall, which operates on a fully-leased model, a delight. Select Citywalk is promoted by Select Infrastructure Pvt. Ltd, a joint venture of the travel & tourism players Select Group and developers Aarone Group.
Contiguous with New Delhi is the city of Gurgaon. It falls in a different state (Haryana), but for all practical purposes it is part of the National Capital Region and synonymous with the term “mall mania.” When the MGF Group launched the Metropolitan and MGF Plaza in 2003, few could have predicted the domino effect that it eventually had. The effect was not of destruction but the other way round – that of construction. The one mile stretch today is home to as many as seven malls, there are two others within a 5km radius. Both anchors of the MGF Metropolitan Mall – PVR Cinemas and Shoppers’ Stop – draw in crowds by the thousands, and you have to be there to see the frenetic buying activities for yourself. Seeing might be believing, but what almost defies even belief is the fact that as many as 17 other malls are being planned in the vicinity. But then, this is also a hangout for youngsters and an ideal place for a family’s day out.
Bangalore’s The Forum is the happening hub of a happening city. The 650,000 sq ft five-storeyed mall is one of the very few that offers lateral entry points and hosts the biggest operational multiplex in India – the 104,875 sq ft, 11-screen PVR cinema. The mall is the favourite haunt of the city’s youngsters and IT professionals who contribute bulk of the 25,000 footfalls it registers on a weekday. During weekends, the numbers skyrocket to over 100,000. The mall has been built by Prestige Estates Projects.
One of the most successful mall experiences in India has been that of the swank Inorbit Mall in Mumbai that was conceputalised by Chapman Taylor Partners. Shoppers’ Stop and Lifestyle draw in the 25,000 weekday crowds and the 50,000 sq ft food court retains them with its sitting capacity of 750 individuals. There are over 100 retail outlets and during weekends the footfalls to the 450,000 sq ft mall (built-up area) rise up to 60,000.
In August 2005, India had 96 operational malls over 21.6 million sf ft of retail space. The projection for 2007, according to Malls in India, was 358 with a built-up area of 87.8 million sq ft. If there is one project that created a flutter from the time its plinth was dug, it is the DLF Emporio – the country’s first luxury mall that will house 130 brands, more than half of them international.
It is not that everything is hunky dory – there are some worrisome issues. The frenzy for building malls is being questioned by many as to whether there is this is driven more by hype than by actual demand. Retailers, right from the big cities of New Delhi to Mumbai to the smaller towns of Bhopal in Central India to Aizawl in the Northeast, are complaining of exorbitant rentals. Many brands have moved out of a number of malls, and some of the latter have even closed down. An industry consolidates itself when a shakeout begins. In the case of the fashion and retail industries in India, this may happen sooner than later.
Designer sells
Designerwear in India today is no longer confined to the hardly-frequented boutiques – it is a Rs 1800 million industry segment. It constitutes an inconsequential percent of the industry in terms of size at the moment, but in terms of scope – it can only grow. In another five years, this segment is poised to swell to Rs 10 billion. FDCI, which works towards promoting and marketing individual designers as well as creating a support for the fashion industry to enter mainstream fashion seems to be doing its bit.
It is in the wake of this that the split in FDCI’s official fashion week over sponsorship and venue issues comes across as a sore point. At a time when designers are still developing a new vocabulary for the changing industry scenario, we now have two fashion weeks – the official one being hosted in the capital New Delhi and the breakaway one in the financial hub of Mumbai. That’s one fashion week too many.
More than a 100 designer labels are today available across different format stores. But there are people’s favourites. In September 2007, Images Retail Intelligence Services (IRIS) conducted a field research on designerwear for a pioneering B2B glossy, IMAGES Business of Fashion. The survey came up with concrete favourites:
Ritu Kumar has developed a unique style of her own, reflecting the ancient traditions of Indian craftsmanship in a contemporary vocabulary. Kumar's understanding of ancient designs and the innovative use of traditional crafts has created a new classicism. She has been a revivalist and successfully bridged the gap between traditionalism and modernity. The first to introduce the 'boutique' culture in India under the brand name Ritu, she has proved that the products of the work of the hand can be as profitable as and even more glamorous than that of machine, and that Indian fashion is more than capable of holding its own in the international arena of haute couture. Her design philosophy is based on the premise that everything founded on a good aesthetic cuts across all borders-be they geographical, cultural or otherwise.
www.ritukumar.com
Branded by Time as India's Master of Fabric and Fantasy, Rohit Bal draws from history, fantasy and folklore to create his masterpieces, which retail for up to US$10,000. Bal’s sense of aesthetics is finely honed, and each of his creations is handcrafted to perfection, with meticulous attention to detail. He has access to the best to industry has to offer in terms of materials and workmanship – from villages where local craftsmen weave dreams with magic fingers, to factories, workshop and outlets where retailers jostle for survival, to the opulent grandeur of glitzy boutique and malls at the best addresses in the big cities of high fashion.
www.rohitbal.com
In a country where a bulk of the fashion trends are shaped by the Hindi film industry of Mumbai (Bombay of yesteryears), or Bollywood for short, it is no surprise that the most of the film industry should have a favourite of their own – Manish Malhotra. It has been Malhotra’s wears that have been instrumental in the makeovers and relaunches of many leading leadies of the Hindi film industry. Malhotra is known for his style, and his innovativeness has been fetching him awards for costume design from the film fraternity by the dozens.
JJ Valaya, known for combining entrepreneurial abilities with originality in designing, has a number of labels to offer. The JJ Valaya label is known for its signature bridal trousseaus and exclusive eveningwear for discerning women and men, JJ Valaya Couture collection defines trends for the season, Studio Valaya line evolves the same trends into a watered down, cleaner and more affordable younger look. Valaya’s style ignores gimmicks and chooses instead to innovate on a quality that defines elegance – that of timelessness. His larger-than-life shows reflect this philosophy and have been instrumental in revolutionizing the scale of single designer shows in the country.
www.valaya.com
The duo of Rohit Gandhi and Rahul Khanna design Western clothes which are practical and wearable – straightline clothing with emphasis on detailing and comfort. Their collections retain the basic elements of style and quality, keeping in mind the increasing demand for Westernwear in India. They keep their silhouettes sharp and defined with an emphasis on fabrics, cuts and a lot of detailing rather than on embellishments.
If there’s a case of a brand image being larger than that of the designer behind it, it is that of Puneet Nanda who named the Satya Paul label after his artist father. Nanda’s design philosophy is ‘Appear as you are, be as you appear’ and he designs garments with a global appeal in an ever changing and multifaceted color palette. The Satya Paul collection of saris, suits, suit fabrics, shirts and blouses bears his unmistakable stamp through vibrant graphics juxtaposed with delicately etched designs, unusual colour palette and vivid contrasts.
www.satyapaul.com
Rocky S came up with his first eponymous label in 1996, but changed to Rocky S Noir ten years later. His speciality is corsets and dresses, and stylised silhouettes, and designs extensvley for the film community in Mumbai. This has not stopped him from promoting his pret line, and now together with a large retail store in the city Rocky S has been designing garments ranging from bridals and ethno-chic to Westerns .
For someone who turned down the job of stylist with Vogue magazine to set up hiw own label, Manish Arora’s signature style has been his visualisation. Arora is known to be winning awards for his creative surges and sells his line both inside Indian and abroad as well. One of those designers said to be with a cutting edge, Arora’s Fish Fry label is stocked by 75 outlets outside India. His inimitable style also makes him the only Indian designer who shows each season at the Paris Fashion Week on the catwalk.
www.manisharora.ws
Ravi Bajaj, known for his elegant cuts and designs, was one of the first to launch 'signature label' boutiques in India. Bajaj has a reputation for both classic and elegant Western wear, and was the first designer who came up with the idea of corporate couture by designing uniforms for the Jet Airways staff. Bajaj has a distinct understanding of market forces and fashion trends that has helped him break away from the routine. It could be the designer salon that sells stylised Westernwear, or the ability to use unusual fabrics and materials for his ensembles.
www.ravibajaj.com
Ritu Beri was one who began designing outfits for herself. One thing led to another, and before one knew it she was in the designing business and a name to reckon with. Beri, known to market herself with as much elan as she promotes her own collections, has achieved instant success even in London's Regent Street.
www.rituberi.com
The promised land
So what promises do this land hold up to foreign companies and their brands?
While there is nothing xenophobic about what people by and large want, the Indian government is yet to throw open the retailing industry’s doors to outright FDI. Foreign brands that seek more profits and more control might be loathe to moving into India right now, but many already have. Lured in by the sheer numbers that have been already mentioned. The challenges that this country poses to debuting international brands are many, prime among them being high duty costs, real estate, and human resources.
Governmental regulations on FDI in India have been deterrents to quite an extent, yet not so much that brands would be staying away from India. More and more companies have been taking recourse to the single-brand route. In 2006, the government decided to allow 51per cent FDI in retail ventures that deal with a single brand. With some amount of political turbulence being expected in India till the general elections that seem to loom large every passing day, it is unlikely that there would be drastic chages on the regulation front now. It would also be some time before the skyrocketing real estate prices stabilise.
Till then foreign brands would rather hook before they leap.
