Dec, 2016      |     By Anil Kumar, Ujjwal Chaudhry

Fashion e-tailing in India

Fashion is currently one of the biggest categories with a 22% share to the overall GM​


Anil Kumar

Anil Kumar

CEO

Ujjwal Chaudhary

Ujjwal Chaudhary

associate director

  • A comprehensive performance review of the online fashion retail sector
  • Assessed through a regularly tracked set of performance indicators
  • Published quarterly

Seven key dimensions for assessing sector performance

Online Fashion Sector Assessment Scorecard- CY 2016

Industry review- CY 2016

Indian e-tailing grew to USD 14.5 Bn in 2016, but growth slowed down significantly compared to 2015

Fashion is currently one of the biggest categories with a 22% share to the overall GM

Overall fashion market remained mostly same throughout the year compared to the overall market

As of 2016, horizontals are still the leading the online fashion retail market but verticals follows closely

Industry review- CY 2016

Private label share- Share of high margin private labels increased more for verticals as compared to horizontals in CY 16

Industry review- CY 2016

Customer Adoption - Overall online retail adoption grew slowly in CY16

Industry review- CY 2016

Customer Satisfaction Scorecard- Overall customer satisfaction saw an improvement during CY16

Customers were satisfied by price attractiveness and product variety available online in CY16

Customers were satisfied by price attractiveness and product variety available online in CY16

Customers were satisfied by price attractiveness and product variety available online in CY16

Industry review- CY 2016

Seller Satisfaction Scorecard- Overall seller satisfaction showed limited improvement in CY16

Sellers were unhappy with lack of sales growth and increased online selling costs in CY16

However, sellers reported an improvement in first mile and warehousing experience over the year

As well as the seller panel experience has also improved for the sellers

Industry review- CY 2016

Delivery Excellence- While delivery time remained same y-o-y in CY16, delivery reliability and % fast deliveries improved

Delivery Excellence- Key Takeaways from CY16

Captive logistics takes centre stage
  • Captive share increased more than 1000 bps y-o-y
  • Large horizontals invested in ramping up captive arms to deliver a superior customer experience
  • Fastest ramp up was seen by Snapdeal's captive arm, Vulcan Express

Warehouse orders become the norm

  • Share of industry orders fulfilled from warehouse also jumped more than 1000 bps y-o-y
  • Driven by increased focus on retail model and by pushing sellers to warehouse storage through multiple initiatives
  • Amazon Seller Flex was one such initiatives wherein sellers could deploy Amazon best practices while storing goods in their own warehouses

Industry review- CY 2016

Industry unit economics improved in CY16- primarily due to cost side improvements

Indian e-tailing is still nascent with a large growth potential -> barely 2% of overall retail spending is currently online

Online shoppers in India currently constitute a very small % of total online population, which should grow rapidly in next few years

Growth in online shoppers to be enabled by a fall in common barriers to online shopping by 2020- per RedSeer consumer research

In an aggressive scenario, we expect the market to move to USD 80 Billion by 2020

Industry financials also likely to improve by 2020- driven by increased sales of higher margin fashion categories

For RedSeer Offerings please write to us at query@redseer.com