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Ethnic Zone Unfolds


With 27-store operations fetching a handsome revenue of Rs140 crore, Soch is now among the top three performers in most mall locations taken on a per square foot basis. The store has spun a success story, even as it gears up to become a Rs 200-crore company in this financial year.

A Bengaluru-based fashion retail chain with expertise in ethnic womenswear, Soch has embarked on an ambitious two-year plan of scaling up its turnover from Rs 140 crore in 2012–13 to. `200 crore in 2013–2014.

, who started Soch as a single store at the in Bengaluru in 2006, is the brain behind this rather impressive growth plan. Having a strong retail background, it didn’t take him long to figure out that the market of branded women’s ethnicwear was relatively untapped. The intuition proved right. “The success of the brand and its immense potential was established in a few months as Soch enjoyed the highest sales per square foot in one of India’s leading malls,” says , CEO & Owner, MD Retail LLP, which owns Soch. After having convinced customers in Bengaluru, Soch expanded its footprint to various places including Chennai, Pune and Mumbai.

Target Group

Although the brand’s designs reflect changing tastes, its target customer has always been the career-oriented woman, homemaker and student, all of whom fall in the age group of 16 to 60 years. “We service sec A, A+, B+ and many times sec B customer profiles,” he adds. “Considering the fact that almost every Indian woman has ethnic clothes in her wardrobe, our prospective market is large. Primarily, we target the working woman and the housewife. Our secondary target market is the youth.”

Over the years, there has been a change in the buying preferences of consumers. Earlier, people bought clothes for a specific occasion, now it is more of an impulse purchase. Today’s customer wants to be well dressed every day and not just for an occasion.

Product Range

The portfolio remains ethnic but with a fashionable twist. Simply put, the retailer understood the changing trend and positioned himself to meet the new demand. In ethnicwear, there has been a drastic shift from the traditional unstitched matching sets to ready-to-wear mix-and-match apparel.

At a time when hemlines are getting shorter and tradition holds sway, saris remain the best seller at Soch, followed by stitched and unstitched sets, kurtis and bottoms. The consumer tastes vary from store to store. At the outlet in Bengaluru, saris and kurtis sell faster than unstitched sets, while at Mantri Square, customers prefer unstitched sets to kurtis and bottomwear. These preferences differ depending on the primary catchment of that respective outlet. The more conservative catchments buy many saris and unstitched  or stitched sets. The catchments that attract more tourists and floating crowds, sell more kurtis and mix-and-match apparels.

This is illustrated through its assortment of kurtis available in seven sizes. It drives home the point that today’s woman has access to both ethnicwear and Indo-western clothes, regardless of her age or size.

Key Learnings

“Today’s consumer wants impeccable service, luxurious comfort while shopping, quick and easy accessibility to products, and convenience of shopping logistics. They want a store with good parking facility, a play zone for the child while they shop, enjoy a meal with friends after shopping and watch a film after shopping,” says Chatlani, generally summing up the consumer psyche.

Having understood consumer dynamics, Chatlani set out with a formula that became successful. The retailer won over consumers as he created a stylish platform for the woman to project her persona. “Soch gives woman the platform to portray her thinking through what she wears. We give each of our customers a wardrobe that speaks her language and shares her thoughts,” emphasises Chatlani, who has an innate understanding of customer tastes. He was quick to realise that the increase in people’s disposable income has been directly proportional to the increase in brand consciousness.

Over time, the Soch staff strength has grown to nearly 500 employees. Each store has a manager, cashier, security guard, tailor for alterations and approximately one sales staff for every 150 to 300 sq. ft. area. The larger formats have an assistant manager and an additional tailor.

It’s a professional setup and the staff undergoes training on product, service, language, and grooming skills. The HR team works on solutions for improving performance and efficiency at the workplace. Brownie points come in the form of an incentive structure, designed around recognising each employee’s performance and appreciating innovative thoughts and methods that a smart employee has adopted.

Stores and Break Even

A new Soch store requires an investment of `40 lakh in fixed assets and an average of Rs 20 to Rs 25 lakh of deposit for four to six months. In addition, stock worth `3 to `40 lakh is invested in depending on the store size and location.

Soch is backed by a strong marketing mantra. The strategy unfolded with direct mails, e-mails, and SMSes to existing customers, hoarding campaigns and advertising in shopping malls. “We strive to grab as many eyeballs and enjoy as much brand recall as we can manage. This is very important for a format such as ours that needs to achieve high sales as our margins are wafer thin,” he explains. As with any other business, the greatest advertising is a word-of-mouth publicity from a satisfied customer.

Everything depends on demand-supply. When a particular category becomes a fast seller, there will be newer additions to the category, allowing the customer to choose from a wider variety, which eventually helps rake in more money. “This is a pleasant cycle that works wonders for not only us but our primary catchment too,” he adds.

Store Dynamics

Chatlani’s USP is location which has led him to have a presence in malls, high streets and shop-in-shops. Though the high street stores are bigger than those in malls, the product offering remains uniform across all stores.

Nevertheless, high streets pose a problem, as most of them don’t have vacant spaces and those that are available are high on rentals. For example, rentals in Linking Road in Mumbai range between `800 per sq. ft. to `1,000 per sq. ft.

Given these steep rentals in high streets, it makes perfect sense to explore retail options in malls where, to get the right location, neighbours, level, and zone are critical for the long-term sustainability of the brand. The consumer has so many distractions from the minute she steps into the mall until she reaches the store she intends to visit. Many times, she doesn’t get to reach the store she came into the mall for in the first place.

Chatlani has ironed out these creases through a presence in three Bengaluru Central Malls and plans to expand store presence in such shop-in-shop formats. “Most mall owners know that Soch is performing very well and in our own way we contribute to increasing footfalls to the mall. Since we are able to delight our customers, mall developers offer us good deals. In fact, Soch is considered a mini anchor as it is an important part of the Ethnic Zone,” he says.

The Ethnic Zone concept has been treated with finesse. Chatlani knows how to position his merchandise, backed by spacious trial rooms. The front end of the store, which attracts impulsive buyers, is usually well stocked. However, as a thumb rule, serious shoppers will make it a point to go into the store to pick up the merchandise that they want.

Some value-adds such as optimum temperature and fairly big AHUs are also incorporated in the stores. Finer nuances have been worked out in detail for discerning consumers. All elements in the store – right from the floral jalis to pleasant colours – are soft and feminine. Besides these frills, the stores pack in essentials like rest areas for family and friends who accompany the customer.

Chatlani has walked that extra mile to create a perfect level of comfort for his customers. Mineral water is supplied to customers and sweets are distributed to children apart from a first aid kit in the store for an emergency. Customers also enjoy the benefit of free alterations even months after the purchase.

The Road Ahead

Soch has laid out its marketing plans, as it gears up to clock revenues to the tune of Rs 275 crore in FY 2014–15. Chatlani’s retail roster is full, as he is strategically set out on a fast-paced expansion spree, working at the rate of one store a month. In the next three years, he plans to open 24 stores and diversify the business model. Currently, Soch operates on a company-owned model. It will take the franchise route by October for the first time. The company is looking at expansion which includes tier-II cities. To an extent, franchise model is believed to address operation-related challenges such as high rentals. “It is increasingly becoming difficult to achieve profits that we used to enjoy in the past,” he admits and adds, “Sadly, although we are anchoring the ethnic zones in most malls, in a few, we had to suffer for being in the wrong locations.” A case in point was in the R City Mall in Ghatkopar, Mumbai, where the store was located on the ground floor of Phase 1 of the mall. Since it was a long walk from the entrance of the mall, customers took the escalator and failed to notice the store on the ground floor. It was a lesson learnt, after which the retailer optimised location to the fullest.