Authored by Entrepreneur Ms.Nidhi Yadav, Creative Head & Founder AKS Clothings
To say that Covid-19 has completely thrown our lives out of order and turned the economy upside down would be an understatement. Even before the pandemic hit us, we were witnessing the impact of the new omnichannel approach on retail – where the people were becoming more and more reliant on shopping on the online portals instead of physically visiting the retail stores. And now that people are more scared than ever of social contact, courtesy of the Coronavirus, a complete rethinking might be required on part of the retailers that would allow them to continue the business.
Once the COVID-19 pandemic started ravaging the economy, all business trends and forecasts were derailed. In fact, with the nationwide lockdown in India, the retail industry was essentially put on pause mode for almost two to three months. Now that lockdown has been lifted in most parts of the country, the fashion retail segment is restoring its elements.
To keep the business alive and customers engaged, retailers cannot just wait and watch and hope for things to get better; they have to make some strategic decisions. They need to step out of their comfort zone and do what they must to survive these difficult times. Being rigid isn’t the way to go right now.
According to the US-based data research firm, Mercatus, in the last month alone, the world has witnessed 1500% more online shopping account registrations and three times more mobile app downloads due to social distancing. And while these figures look pretty promising for online retailers, they are a bad omen for those who are in the business of offline retail. In the new normal, most urban dwellers would prefer to shop whatever they can via the online channel as nobody wants to put their health by visiting retail stores where they could come in contact with people who might be carrying the dreaded Coronavirus.
There’s an old saying that trees that do not bend when the strong winds blow, end up falling, and it is pretty accurate and applicable in the current scenario. While entrepreneurs have their reasons for choosing the platform they like to trade on – whether it’s online or offline – the most important thing to remember is to be adaptable to change. E-commerce is the need of the hour, and those retailers who do not want their brand to sink, need to create channels in the virtual market as well to retain their customers. The first rule of business is to set up shop where the people are, and nowadays, they are on the virtual platform; so that is where you need to be as well.
Even if the lockdown is in place, there are certain supplies that the customers will continue purchasing. Among these, FMCG (Fast Moving Consumer Goods) and food items have seen quite a spike in their online sales. Many FMCG companies have even ventured into new areas and have adapted themselves towards manufacturing goods that are seeing a surge in demand. Hand sanitizers, vegetable washes, immunity boosters, and other health supplements have been in high demand ever since the lockdown was imposed, and experts are predicting that their demand would remain high for the next 4 to 5 years at least. People have become much more health-conscious because of the pandemic, and they would continue to gravitate towards products that promote a healthy lifestyle.
As social gatherings, parties, and events are prohibited in the lockdown period, people will prefer to postpone apparel, jewelry, and other lifestyle products, but some essential goods would still be bought. That’s why many offline retail businesses have decided to pursue customers through online platforms and most of them succeed in this time shift.
As the consumers are likely to stay at home for a certain time with work and social interactions, categories such as women’s ethnic wear and nightwear, which were already accelerating (5% incremental growth over other categories pre-Covid) are bound to increase their pace of growth even more. Also, professional workwear variety and styles might take a hit and shift towards everyday comfort wear. Needless to say, comfortable home clothing and demand for fashionable cotton masks that are reusable and reversible is expected to rise.
From an online channel perspective (apparel constitutes 35% of e-commerce in India), items that have not been worn by multiple customers are likely to see continued robust demand, while other categories are likely to see a muted demand as the consumers would fear that other people would have tried on those products. This is one of the major problems with offline retail stores and malls, as people can never be sure that whether or not the dress they like has been already been tried on by someone else. Although you don’t get the option to try dresses online either, within a foreseeable future, we might see the intervention of AR technology in online retail, which would allow you to see what a certain dress would look like on you. Whether or not that technology would be scalable and how soon would it be available is a whole another discussion though.
Given that consumers are turning conservative, price-conscious consumers are likely to down-trade (e.g. preference for Arrow rather than Arrow New York) and are less likely to focus on values like sustainability. Emerging go-to-market models like rental, subscription, and re-commerce are likely to take a substantial hit as well in the interim due to concerns over safety and hygiene. Overall, many retailers would have to struggle for a while to sustain their business, but with the right strategy, dedication, and a spoonful of optimism, the storm could be weathered.
About the Author
While pursuing her fashion designing course in Italy, Nidhi Yadav thoroughly studied the business model of the iconic brand, Zara. Inspired by their success, she decided to replicate it in AKS, a brand of Yuvdhi Apparels, founded by Nidhi on May 14 with small seed capital of INR 3.5 lac and a small warehouse of less than a thousand units.
Today, AKS has its headquarter in the Millennium City of India, Gurgaon, and an integrated network of printing, dyeing, stitching and manufacturing units in the Pink City, Jaipur. Under Nidhi’s unwavering grit and leadership, the Brand has grown to 100cr revenue without any external funding and they are serving more than a lakh customers in a month and aiming to reach 200cr.