Elevating Sales in Tier II and Tier III Cities owing to increased Online Shoppers is Expected to Fuel India Online Fashion Market in Future


February 2017 | India News

  • Future growth of India online fashion market is expected to be driven by increasing demand for online fashion accessories products from Tier II and Tier III cities.
  • Myntra, Jabong, Flipkart, Snapdeal, and Amazon India are major players operating in the market. Myntra is observed as the second largest player in online fashion market owing to the tie-up of company with more than 500 leading fashion and lifestyle brands.
  • Tier I cities were the major GMV contributor in online fashion market in FY’2016 owing to the availability of personal disposable income with the people residing in these cities coupled with the high awareness.

Ken Research announced its latest publication on “India Online Fashion Market to 2021 – Elevating Sales in Tier II and Tier III Cities is Expected to Fuel the Market in Future” provides a comprehensive analysis of the online fashion market in India. The report includes the cumulative GMV generated by the market players from the sales of online fashion products, including apparel, footwear and accessories. Further, the market in the study is differentiated on the basis of tier cities into tier I, tier II, and tier III cities. The market is also segmented by four price segments – economy, mass, premium, and elite. The study also highlights the detailed information about logistics procedure followed in online fashion market and government regulations pertaining to the market, which will guide new entrants to plan their strategies accordingly. Various marketing analysis factors such as trends and developments and Porter’s five forces analysis are also added in the study for clear understanding about the factors responsible for present scenario of the market. The future analysis of overall India online fashion market has also been discussed along with recommendations from analyst view.

Online fashion market is spreading its footsteps in tier II and tier III cities. It has been observed in FY’2016, majority of online sales was generated from eight metro cities whereas the rest of the sales is generated from 3,133 Tier II and Tier III cities, which also includes 1,233 rural hubs. The online fashion retail has sighted a significant increase in sales from Tier II and Tier III cities since 2012. The overall growth in Tier II markets have been about 600% from FY’2012 to FY’2016. The most common products bought in Tier II and III cities are fashion items including apparels, footwear and bags. Non metro cities like Ludhiana, Aurangabad, Kochi and Bellary contributed 35% in the total sales of luxury brands in FY’2016. The growing demand for online sales in these cities has fueled the online fashion market of India.

“Horizontal e-commerce players should focus on increasing the profitability through private label sales, reducing the advertising budget and improving the NPS score for buyers and sellers while, verticals players should focus on above the line advertising for increased penetration and for better positioning as a specialized fashion store to sell a fashion look along with individual itinerary. Vertical players has to build a USP in one of the fashion segment through unique design, increased number of brands including private label and international brands, improved accessories sales along with offering better discounts, cash backs to the customers”, according to Research Analyst, Ken Research.