Myntra crosses $1bn in annualised GMV, to open their first offline storeAthira Nair
The year 2016 has been quite happening for Myntra– they hired top names from Amazon, FreeCharge and eBay; gave up on their app-only strategy and came back to the desktop; launched Try-on-Delivery; and a few weeks ago, acquired their rival Jabong for $70 million. Now, they are taking their strategic innovations to the next level - Myntra will be opening their first offline store before the end of the year. Earlier, online marketplaces such as Zivame, Lenskart, Pepperfry, and Buttercups, have already taken the offline stores’ route.
At an event in Bengaluru today, CEO Ananth Narayanan said, “This strategy is meant for marketing and touch-and-feel experience. We are also looking at how to work with different brand partners.”
Myntra has crossed $1 billion in annualised GMV in July 2016, from $800 million in January, Ananth said. He added that they gain maximum number of customers in July sales – about half a million this year. “We have 80 percent repeat customers. You can see the baseline shifting. In 2015, we has five million monthly users; now it’s 10 million.” A first in Indian online fashion retail, this is expected to help the Flipkart-owned portal touch $1 billion in GMV in the fiscal year.
According to Ananth, their full price sales have grown twice, and discounted ones have come down by 10 percent. He claimed that Myntra has had 70 percent YoY growth in the first four months of this fiscal year, with international brands growing at 140 percent. Ananth added that they expect to be profitable in the next fiscal year. Myntra will add to its categories in the home, fashion accessories, and personal care segments too.
Jabong to remain separate
Myntra’s most recent acquisition, Jabong, will remain an individual entity. The two will not merge, as this strategy helps them acquire more market. “For healthier unit economics, it’s better to position the two brands differently. The proportion of male-female customers is 60:40 for Myntra, while it is the opposite for Jabong."
Asked about marketplaces interfering with brands and retailers in terms of pricing and discounting, Siddharth said that it is completely the retailer’s call. However, Abhishek said that it is definitely a problem. “Now that Jabong has joined us, the discounting can go down. It will provide an enriched experience at higher price points,” he added.
Ananth was joined by executives from their partner brands Puma and Biba. Siddharth Bindra, MD, Biba Apparels India, said that e-commerce accounts for 15 percent of their current revenue, and they expect it to touch 25 percent in the next three to five years. Puma gets 22 percent from online sales, while BMI – which sells Tommy Hilfiger, Gucci, Calvin Klein, FCUK etc. – gets 25-30 percent.
Abhishek Ganguly, MD, Puma India, also said that consumer engagement with their customers has increased in the last three years via e-commerce as they target the youth. Vijay Murjani, MD, BMI Wholesale Trading, and Anjana Reddy, MD, Universal Sportbiz, were also present at the event.