APRIL ,12

VOL. XIII

No. 4

`100

US$20

F A S H I O N • M A R K E T I N G • R E T A I L I N G

INDIA FASHION

FORUM

Talking Points• New Markets & MBOs• Bespoke Tailoring & Private

Labels• Modernisation &

Empowerment• Fusion & Fashion• Location & Space• VM & In-store Action

Cover BoF April FINAL.indd 1 4/2/2012 5:15:20 PM

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April 2012 | 162 pages | VOL. XIII No. 4 | www.imagesfashion.com

editor-in-chief amitabh taneja editorial director r s roy publisher s p taneja chief operating officer sandipan singh

executive editor madhumita bardhan sinha chief of bureau (mumbai) nivedita j pawar (sr. assoc. editor) sr. research correspondent nalini singh sr. correspondent aakriti agarwal copy editor cum correspondent trisha mukherjee research correspondent (kolkata) vasantasena biswas correspondent (mumbai) tista sengupta correspondent (bangalore) roshna chandran

business development assoc. vice president (north) vineet chadha assoc. vice president (west) santosh menezes assoc. vice president (south) suvir jaggi assoc. vice president (east) piyali roy oberoi dy. general manager (north) rajesh kaul sr. manager (south) sunil disley manager (north) jayant arora sr. executive (east) pratik ghosh

circulation & support assoc. vp – circulation & subscription anil nagar general manager – administration hemant wadhawan sr. manager – circulation r p singh dy. manager – circulation ranjeet kumar yadav dy. manager – operations rajesh kumar sr. executive – subscriptions kiran rawat

creatives art director pawan kumar verma asst. art director dinesh devgan layout designer rajeev kumar sr. photographer vipin kardam asst. photographer deepak malik photo coordinator kamal kumar production general manager manish kadam sr. executive ramesh gupta

Amitabh Taneja

The India Fashion Forum 2012 in its new avatar proved to be a resounding success. Bringing together the entire fashion, shoes & accessories and the textile sector and more than 250 global and home grown brands, IFF this year buzzed with a palpable energy and excitement that permeated throughout the venue and was the platform for many action-packed deliberations, interactions, business dealsand recognitions.

The three-day mega event was an eye-opener in many respects. The biggest opportunity was seen in thousands of family run retailers that are already operating profitably in small markets with sales of `5 to 500 crore. Though, mostly in textiles, many have already expanded their offering by adding ready-to-wear brands. While global and national players are most likely to operate in 59 cities with its million plus population, the next 100 cities will develop only if regional and local players upgrade and expand the size and scope of their stores. Hence the logical route to expand will be by forging strong partnerships with retailers in such untapped cities and towns to take fashion to the deepest corners of India to profitably grow the fashion industry as a whole.

Listening to the success stories of the regional players, one could learn many lessons. The business model set up by traditional textile retailers with tailoring outfits could be just the right way as the issue of decreasing margins in brands has been well tackled by such retailers targeting one-third of their business from tailoring and private labels and two-third from retailing a mix of local, national and global brands. Shop-in-shops in MBOs generate over three times the revenue for brands than in their own exclusive outlets.

But we also heard these retailers voicing concern about their next generation’s disinterest in taking over the mantle in the future. Get the glamour of brands in your stores, I say! This will surely lure the younger generation towards the family business.

I was happy to see that the India Fashion Forum 2012 definitely re-inforced the optimistic attitude that the fashion retail industry wears today. Great days ahead!

Editorial.indd 11 3/30/2012 3:22:06 PM

CONTENTSAPRIL 2012 VOL. XIII NO. IV

18 MY THOUGHTS Moving Beyond the Unorganised Deepak Tulsian, VP – Retail, Gitanjali Gems Ltd, shares

his prespective on India’s organised and unorganised retail markets.

88 AWARDSHonouring the fashion retailer for their last year’s achievements.

108 RUNWAY Brands showcase their latest collections.

122 NetworkingIndustry professionals interact and bond.

124 EXPERTSPEAK Overview of Retail Formats Amit Gugnani, VP, Apparel Operations, Technopak,

talks about the emerging retail formats that fashion brands are experimenting with to maximise their profits.

11 Editorial

17 Letters to the Editor

40 March in Brief

63 Trade Calendar

156 Season’s Offerings

66 Outlets

147 Window Trends

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The 12th edition of India Fashion Forum was a mega event

where the who’s who of the fashion industry congregated to

discuss various opportunities, challenges and the way ahead for the Indian fashion industry.

IMAGES BoF brings back primary learnings from the

recently concluded event.

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India FashionForum 2012Key Learnings For the Way Ahead

Contents.indd 13 3/30/2012 4:23:56 PM

CONTENTSAPRIL 2012 VOL. XIII NO. IV

The Midlife CrisisHarminder Sahni talks how the lure of the young consumers has led brands to ignore the lucrative segment of not-so-young consumers.

H A R D T A L K

145127 DESIGNER WEAVES Lakmé Fashion Week Summer Resort 2012 Meher Castelino picks the hottest trends for the

upcoming season.

142 THE JOURNEY Riding the Success Wave Ajay Ramachandran, Brand Head, Van Heusen,

speaks about how to remain consumer relevant for two decades.

154 EVENTS Credo Brands Marketing Pvt. Ltd. brought together

all Mufti franchisee to share their best practices.

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Contents.indd 15 3/30/2012 4:23:58 PM

• MY THOUGHTS •

18 | April 2012 | IMAGES Business of Fashion

UnorganisedMoving Beyond the

INDIA IS ONE OF THE RETAIL HOTSPOTS; AND WITH MAJOR INTERNATIONAL PLAYERS EYEING TO GRAB A SHARE OF THE SPACE IT’S TIME TO STRENGTHEN THE ORGANISED RETAIL MARKET. DEEPAK TULSIAN, VICE PRESIDENT – RETAIL, GITANJALI GEMS LTD, SHARES HIS THOUGHTS WITH IMAGES BOF.

India ranks among the top five retail destinations in the world; and the country is witnessing many international brands competing with each other to create a strong foothold in the Indian soil. Also, the retail industry is gradually starting to walk the path of modernisation. With the influx of different international brand stores, departmental stores, concept stores, hyper and super markets, et cetera, international trends have helped to strengthen the organised

segment. The 2011 A.T. Kearney Global Retail Development Index states that the organised retail in India accounts for 7 per cent of the roughly $435 billion retail market and is expected to reach 20 per cent by 2020. Organised retail has a 31 per cent share in clothing and apparel and continues to see growth in this sector. The home segment is promising with a growth of 20 to 30 per cent per year. This can be attributed to young India becoming more and more fashion conscious. Consequently, even the accessories market is benefiting from

this trend. In the present scenario, the jewellery segment accounts for about 8 per cent of the total retail industry in India and the Indian jewellery industry ranks as the third-largest market in the world. Jewellery retail is growing at 15 per cent per annum, while the overall retail is growing at 12 per cent per annum. Only 6 per cent of the Indian jewellery market is organised, similar to overall retail market.

my thoughts.indd 18 3/30/2012 3:20:30 PM

• UPDATES •

April 2012 | IMAGES Business of Fashion | 43

TRYSTSBrand Reliance Brands, a part of Mukesh Ambani-

led Reliance Industries, has announced an equal joint venture with the U.S.-based Iconix Brand Group. The joint venture company – Imaginative Brand Developer India Pvt. Ltd will be based in Mumbai and will follow a similar business model to that of Iconix in North America, which focuses on growing royalty revenue through existing and new licensing agreements with both manufacturers and retailers, while providing marketing and brand management services. Currently, it also has similar ventures in other countries including Greater China, Europe and Latin America.

According to Iconix Brands, partnering with Reliance was an essential next step in its global expansion strategy. With this new partnership in place, and together with its existing global partnerships in other regions, Iconix plans to achieve its long-term goal of growing international revenue to a third of its total business.

The new JV company will own the fashion and home brands from the existing Iconix business in India, which includes brands such as Ed Hardy, Mossimo, London Fog and Ocean Pacific. Ed Hardy, and Mossimo, from Iconix Brands’ stable are already present in India through tie-ups with different companies.

INDIA WITNESSES FREQUENT BRAND MARRIAGES AND BREAK-UPS. DO NEW COLLABORATIONS BRING IN MANAGEMENT CHANGES? AND HOW DO CURRENT DISTRIBUTORS GET AFFECTED? IMAGES BOF INVESTIGATES THE RECENT JV BETWEEN ICONIX BRANDS AND RELIANCE BRANDS.

Update SR.indd 43 3/30/2012 3:17:12 PM

• EXPERTSPEAK •

124 | April 2012 | IMAGES Business of Fashion

Retail FormatsOverview of

THE RETAIL INDUSTRY IS MOVING TOWARDS BEING MORE ORGANISED AND BRANDS ARE EXPERIMENTING WITH VARIOUS RETAIL FORMATS TO MAXIMISE THEIR PROFITS. AMIT GUGNANI, VP, APPAREL OPERATIONS, TECHNOPAK, TALKS ABOUT THE EMERGING FORMATS.

The Indian retail industry has grown from around $290 billion in the year 2005 to approximately $430 billion in 2010. The key drivers of the growth have been - rapid urbanisation, increasing middle class double income families, increased exposure to fashion owing to higher awareness through media,

internet, et cetera. The size of the Indian organised retail industry is $21 billion, and at this figure, the organised retail forms approximately five per cent of the total merchandise retail of the country. The organised retail industry comprises various retail formats such as exclusive brand outlets (EBO), large department stores (LFS) such as Lifestyle, Shoppers Stop and multibrand outlets (MBO) and

then the traditional format of regular mom and pop stores.

Exclusive brand outlets have traditionally been the building blocks for most brands. EBOs offer brands the potential for complete display of the offering and also provide specific services related to the brand. The brand value proposition is clearly translated and experienced by consumers within the EBO format. Branded stores usually find presence in either malls or at high streets and largely experience-led prominent shopping destinations. Internationally, and also in India, brands have often used EBOs as an essential tool for brand salience and typically do not spend on ATL advertising activities. The EBO has been used for communicating the brand’s image and it offerings. Retailers have used visual merchandising as a tool to best present the product offering as well as fashion cycles while keeping in mind the shopping experience that the consumers seek.

Prior to 2008, EBO was the preferred mode of retail business entry. Most retailers took this route for their retail foray to exhibit brands in these exclusive formats across new malls or high streets. The real estate drivers saw the potential far too soon and the prices skyrocketed for these places. The early entrants were happy to leverage this opportunity, whilst the new entrants came under tremendous pressure of rising rentals of the brick and mortar format. Higher rentals started denting the overall profitability of the businesses, which were also going through pressures due to increase in raw material pricing, additional taxes levied on branded apparel and inflationary effects. All these combined factors led to reduced sales across formats. Some of the brands who took this path are now realigning the size versus location strategy across formats. Retailers are now penetrating tier II and tier III cities, where the rentals are still low and are able to ride the tide of high aspiration of the large population base in these cities. Thus, brands are foraying into smaller cities with the EBO format

Expert Speak.indd 124 3/30/2012 3:23:50 PM

Midlife Crisis

The

• HARD TALK •

Imust have shared Mark Twain’s famous words regarding clothing in some earlier article. But, I am repeating it again as this phrase keeps coming back to my mind all the time. Twain said - “Clothes make the man. Naked people have little or no influence on society.”

The power of these simple words is uncanny and I feel proud to be part of the fashion and clothing industry that makes a man a man. I notice it all the time - how people project themselves to their target audience, with the help of their clothing. The successful as well as wannabes - actors, politicians, sportsmen, businessmen, et cetera use designers and stylists to help them create a wardrobe that matches with their public

personas. The responsibility of helping the rest of us in doing the same falls on the shoulders of brands. But I am not sure whether many Indian brands are currently playing that role effectively for one of the most important segments.

The urge to capture the mindshare of younger consumers is making most of the brands miss the far more attractive and lucrative segment of not-so-young consumers. I am referring to the consumers, mainly men for the purpose of this article, in the age group of 45 to 55 years. These consumers are the same consumers who were between 25 and 35 years age group just 20 years ago when the clothing industry started to move from tailor-made to readymade clothing brands. So most of the Indian brands owe their success to this set of consumers.

These are the consumers who were early adapters and are the ones who shunned the traditional way of dressing for the modern way. The generation after them was born when the market was already established and the readymade clothing had already taken its fair share. This new generation never experienced the joy or pain of going to a fabric store, buying fabrics and co-ordinating it as per their own understanding of latest fashion and then going over to the tailoring shop a little further away and give instructions to the tailor for the collar shape, number of pockets and buttons, et cetera, while the masterji measured them up once again. These consumers in the age group of 45 to 55 years are now in the prime of their careers and are successful beyond their own imagination and have the willingness

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April 2012 | IMAGES Business of Fashion | 145

Hard Talk.indd 145 3/30/2012 2:56:07 PM

154 | April 2012 | IMAGES Business of Fashion

• EVENTS •

Brand Mufti aims to satisfy consumers whose preferences have moved beyond off-the-rack mentality and want to make a fashion statement reflecting their own distinct personas.

Launched in 1998, Mufti have been focusing itself in imprinting the mantra of forever young in the minds of its consumers.

The franchise model works within a proven system, and the instant brand awareness and credibility that it generates is vital. Mufti is aware that its franchisees are the ones who are critical to its success; they are the people selling its products. Going forward with this philosophy, the brand organised its Spring Summer 2012 Franchisee Meet on 28 February 2012 at the Ramada Convention Centre Powai, Mumbai.

“The idea is to not only open stores

but also to do it well,” emphasises Kamal Khushlani, Director, Credo Brands Marketing Pvt. Ltd., the makers of the brand. ”We want to train our people. We were doing it individually earlier, but now we wanted to get them all together.” The entire focus was on peer group learning as opposed to wisdom being handed down by the company.

With approximately 150 franchisee managing nearly 170 stores, the law of averages makes it natural for some stores to fare better than others. But what surprised the brand was that some of the bigger cities were unable to generate revenue as per its potential.

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Mufti Organises

Mufti FINAL.indd 154 3/30/2012 1:46:57 PM

April 2012 | IMAGES Business of Fashion | 155

Franchisee Meet

1. Mr. Alpesh Jain, Retail Icon of Mufti, V Style, 2. Mr. Avnees Mishra, Highest Sale Store, Ethix Clothing 3. Mr. Avneesh Mishra, Retail Icon of Mufti, Ethix Clothing 4. Mr. Gurpal Walia, Retail Icon of Mufti, A.G. Enterprises 5. Mr. Manan Bakiwala, Retail Icons of Mufti, Padmavati Retail Pvt Ltd 6. Mr. Manpreet Singh Sahani, Retail Icon of Mufti, Tipsy Topsy 7. Mr. Sangesh Dalal, Retail Icon of Mufti, L.K.Agencies 8. Mr. Sanjeev Gupta, Retail Icon of Mufti, Kratika Enterprises 9. Mr. Rahul Tolani, Retail Icon of Mufti, Traffi c Jam

”Our store in Delhi was doing only `6 lakh a day whereas places such as Pune were doing approximately `1 lakh. Even remote places such as Bilaspur in Chhattisgarh and Sarsa in Gujarat were doing `45 lakh and `10 lakh, respectively,” revealed Khushlani.

What better way to countermand this hurdle than bring together all the franchisee holders to evaluate what each one was doing. Mufti organised a whole-day seminar to discuss the best practices adopted by each store and analyse the best way of improving sales. The objective was two pronged; the franchisee got to know each other,

and the company focused on getting constructive criticisms and suggestions to mutually grow their business.

The meet was a resounding success with many eyes being opened with figures showing the success achieved by small towns, multiple store management and the co-existence of mall stores and high street stores. Open forum discussions about what each franchisee was doing highlighted the right approach to the business and created learning opportunities for all.

Acknowledging the importance of recognising excellence, the promoters

of the brand awarded all achievers of the last season. The bigger franchisee were enrolled in a “Mufti Retail Icon” chapter. Consistent growth performers were awarded as Growth Star along with the

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Highest Single Day Seller and the Highest Sales Performer awards in the Autumn Winter season.

In keeping with its philosophy of being a youthful brand it was not all work for this big congregation. The day ended with music and fun. A table-thumping speech by Jadish Joshi, a motivation speaker, who is also well known for conducting business enhancing courses set the tone for the evening. Cocktails and dinner put the final touches to this great experience, energising all Mufti partners to be prepared for the next season. BoFBoF

Mufti FINAL.indd 155 3/30/2012 1:48:21 PM