While the parent company Flipkart is dealing with markdowns and employee attrition, its fashion arms Myntra and Jabong are moving ahead with great gusto. Both the fashion etailer are independently working towards enhancing their product portfolio and platform.
Myntra ties-up with two fashion brands
The fashion etailer launched its Brand Accelerator program in February 2017, under which they planned to form strategic partnerships with at least 15-20 brands.
Myntra has found two such brands in the shape of women’s western wear label Chemistry and ethnic wear label AKS. The etailer recently joined hands with both of these labels and is targeting 10-fold increase in sales.
The fashion brands hope that Myntra’s expertise in developing online brands, backed by strong technological support would help them to become one of the leading fashion brands in the country. Reach, visibility and volume are what Myntra is offering to these fashion labels.
Chemistry expects their online sales to account for 50% of the total brand sales. On the other hand, AKS plans to increase its annual gross sales from $6 million to $60 million.
What’s part of the Brand Accelerator program?
- Myntra would pick up equity in these brands according to their sales performance
- The etailer aims build a portfolio worth $1 billion over the next 3 years
- To move away from discounts and create differentiating factor
- Expected gross sales from these strategic partnerships is $500 million
Myntra’s CEO Ananth Narayanan said, “With Myntra, these brands get massive traffic, consumer data insights both online and offline and sourcing power. We can guide brands on where to open stores, which price points sell, which styles are popular, etc. We also have deep sourcing expertise because of our private brands. For us, with the brand accelerator, we add more unique products for our customers, increase our exclusive offering and we get higher margins.”
Jabong gets moody with virtual ‘Jabong Mood Store’
Let’s move on from Myntra’s brand accelerator program to Jabong’s mood store. Myntra acquired the fashion etailer in July last year. And since then both have been operating independently, except for sale events.
At present, Jabong is running a campaign ‘Many Moods, Same You’ to promote its virtual Mood Store. Jabong’s Head Gunjan Soni explained the thought behind this innovative store.
He said, “…The genesis was based on deep consumer insight… A lot of our customers told us that there’s no point in selling us ‘just apparel’; that they’d rather expect to be guided on ‘What pairs with what?’… Our research suggested that a consumer wakes up every morning and decides what she should wear that day, basis her mood. That’s when we thought – ‘Why is the entire shopping experience led by categories and sub-categories when the consumption behaviour is different from that?”
The looks presented by this mood store are based on budget, occasion and brands. Soni emphasized that this is just one of the many innovative concepts that are in offing in Jabong’s future.
Post-acquisition period treating Jabong well
While there were murmurs that all is not well between Jabong and Myntra, Soni has a different story to tell. Jabong’s head believes that after struggling with loss in revenue and NPS for a long time, the company is finally on the right track.
“Post-acquisition, it’s been a fantastic story. We ended this quarter (March end) at 30 percent quarter-on-quarter growth. As per NPS, from 20, this year we ended at 52 percent. This means we have actually revived consumer confidence. We have also been able to contain cost. For more than three months, Jabong has been gross profit positive. This has come on the back of growth revival with new brand launches; between March and April 2017, we launched almost 35 brands. We have also been able to improve our gross profitability in the last three months,” beamed Soni.