The Great Fight For Shelf Space

AMAZON, FLIPKART, AND MYNTRA ARE JOSTLING FOR TOP SPOT IN THE ONLINE FASHION RETAIL SEGMENT. THEY BRING GREAT STRENGTHS AND GREATER MONEY-POWER TO THIS BATTLE. AS OF NOW, THE SMALLEST PLAYER LOOKS LIKE IT’S WINNING.

- Deepti Chaudhary And Debojyoti Ghosh

IT LOOKS LIKE any other printed T-shirt; the image is of a man sitting beside a campfire. Nothing out of the world, and definitely nothing that will make you shell out Rs 500-plus. Till you point a smartphone at it and see the picture come to life on the screen; the flames flicker, sparks shoot out into the night sky, and you can walk closer to the fire as you move your phone.

Online fashion retailer Myntra plans to launch these augmented reality T-shirts in the next month or so; its chief executive, Ananth Narayanan, says he’s excited about the “amount of technology and fashion innovations that we are doing”. E-commerce watchers will tell you that Narayanan has little option but to innovate. He’s up against stiff competition not just from global heavyweight Amazon, but also from his own parent company, Flipkart, to say nothing of the dozens of small fashion startups scrambling for market share.

Globally, online fashion retail is one of the largest categories in e-commerce, and things are not much different in India. Gross margins in the online fashion business tend to be very high, sometimes as much as 40% for branded products and 50% to 60% for private labels. This is very important to the Indian e-commerce industry, which continues to grapple with losses. Flipkart, for instance, saw a 68% increase in losses in FY17. International e-commerce giant Amazon concluded the year 2017 with losses of $3 billion, mostly attributed to its spending in India. Amazon did not give separate financials for its India business.

The Indian online fashion market is projected to grow 3.5 times from its current $4 billion to touch $14 billion by 2020 and everyone wants to ride this wave.