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612 League to open 800 stores by 2020; aims to be Rs 350 crore company

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With parents and children becoming more conscious about kids fashion and trends, the complex kidswear segment in India has been witnessing a boom.

612 League to open 800 stores by 2020; aims to be Rs 350 crore company
Going further, 612 League will add nightwear, inner wear, accessories, and shoes by 2018

The market – which was worth Rs 59,520 crore in 2015 – accounted for 20 per cent of the total apparel market of the country. It is expected that kidswear will significantly surpass the growth of menswear and womenswear by growing at a CAGR of 10.8 per cent to reach Rs 1,65,120 crore in 2025. This is one of the major reasons why the segment has attracted retailers’ attention in recent times.

Among the many brands catering to kids, the first Indian brand which focuses on pre-teen children is . The brand has segregated clothing lines for age groups of 0-2, 2-6 and above 6 year olds. It understands that the 2-12 age group is not one segment, but consists of varied tastes and choices.

In an exclusive interview with Indiaretailing Bureau, Co-founder, 612 League, Manu Indryan talks about India as a kidswear market, the brand’s journey in this tough market, its Omnichannel strategy as well as future plans.

How do you perceive India as a kidswear market?

The Indian kidswear market has had the most fragmented structure. Only now has it started moving towards an organized structure. Shopping experience has also seen a shift from store purchasing to online shopping. This growth has majorly happened due to the change in mindsets and shopping patterns in India.

Today, India is characterized by nuclear families with dual income households where parents want to dress their kids fashionably and don’t shy away from spending a little extra on their kids comfort and brand value.

Kids today have an exposure to a lot of social media through television and Internet, making them fashion conscious and keeping them at the pace with the latest trends in the kids fashion industry. The media exposure also influences their fashion choices and they love to adopt styles of their favourite style icon, celebrity or cartoon characters.

While the increase in purchasing parity and active participation of fashionably aware kids in the shopping decisions have been the major growth factors for the kids fashion industry, the way in which brands today make themselves visible and available on various channels also contributes to the collective consciousness.

How has been the brand journey so far?

Parenting the business right took 612 League from Rs 5 crore to Rs 130 crore entity. Six years back when 612 League started off with Rs 5 crore, we didn’t take the traditional route. Instead of starting a production facility, the brand first invested in a design studio with NIFT designers, consumer research and market study.

The journey from large format stores to exclusive brand stores pan India has been an interesting one. A pilot workshop facility in Ludhiana was set-up in October 2008 with 20 machines from where merchandise were supplied to Westside as white label supplier. The brand was later displayed at four stores of Shoppers Stop (North). Today, 612 League has made its presence felt in 150 cities across India with close to 500 touch points which includes 53 EBOs.

Throw some light on your business model?

Currently, we bring out 500 styles in 7 sizes and an overall count of 3,500 SKUs. 200 of these are quintessentially 612 products, i.e. international in appeal. Rest of the 300 are defined by the market spread, geography and season.

The production capacity is over 1,35,000 garments per month. We have multi-stage quality control systems in place from raw material (yarn/fabric) to garment finishing.

We entered the retail space through Shoppers Stop. Our approach has been strategic and calibrated. We still retail through diversified retail channels. After having established the brand our focus is now on growth of EBOs. EBO is where customer enters the brand space, it differentiates the label from the brand. 8 out of 53 EBOs are company-owned while the rest are franchise stores. The number is projected to grow to 60 very soon.

Keeping pace with the times, we have a robust presence in e-commerce as well as we see it as a value channel for us.

Many well-established foreign kidswear players have entered India of late and have taken the consumer base by storm. What is your approach to the competition?

The preference of branded apparel is seen a positive step, since it categorizes the kids wear market and helps in increasing the importance of brand value in the customer’s mind. Although, with more international brands coming in India, the competition has no doubt increased in the industry.

However, we at 612 League believe keeping Indian sensibilities in mind right from choosing the fabric to designing the collection, gives us an edge over the other brands. We understand our customers better than any other international brand and we customize our range not only as per seasons but also as per the demographics of India (North and South, East and West) as well as colour and fabric preferences.

What is your pricing strategy?

Parents in India still play a major role in so far as purchasing decision is concerned.

For our baby range, the target audience are parents belonging to middle/ upper middle income households.

For pre-teen children (6-12 years), our major target audience are the mothers as well as children themselves who are fashion conscious and love to wear smart yet comfy clothes.

We see ourselves as an aspirational brand and a real clutter-breaker when it comes to offering differentiated products for the various age group within the 6 months-12 years bracket. Our collection is affordable and we have always kept in mind the Indian sensibilities to provide the best of fashion to our customers. So, any parent looking for characteristics like fashionable, comfortable and affordable in one brand, we are one stop-shop destination for them.

Throw some light on the category mix? Which is the fastest moving category?

Our current product category is majorly divided into baby, boys and girls. For infants and toddlers the age bracket falls under 6 months – 2 years.

We provide our customer a wide range of apparels for different age groups which are conducive to the active lifestyle of a child.

We look at international forecast and co-relate it to Indian culture. We spend a lot of time and effort in trying to understand the lifestyle of urban middle class and upper middle class. The age group is defined by an active lifestyle.
Ripped jeans, track pants, and layered shirts have done exceedingly well for boys. Scottish skirts and leggings and shirt dresses have been a favorite with pre-teen girls. A lot of categories have moved from occasion/leisure wear to daily wear.

The fastest moving product categories are girl’s dresses and boy’s T-Shirts.

Any plans to explore new categories?

Yes, we have recently added ethnic wear (spring soul) for boys and girls in the age group of 3-14 years. Also, we are launching 612 fearless – a high fashion range for teenage girls in SS17. Going further, we will add nightwear, inner wear, accessories, and shoes by 2018. This would make us an umbrella brand for children in the age group of 6 months to 16 years.

 

Share your Omnichannel strategy.

Being a kidswear brand we look for marketing strategies that are both innovative and interactive for kids. Considering the evolving shopping patterns in India, where parents and kids are equally fashion conscious, we look for marketing opportunities that can involve both to make their shopping experience fun and wholesome.

We had recently launched Wonder Store concept through our EBOs in Bangalore. The Wonder Store is first-of-its-kind Virtual Reality shopping platform in India, based on the Augmented Reality Technology.

It’s a gesture controlled, kid-friendly kiosk which enables trials of over 300+ products with just a flip of a hand and the option for placing an order. The platform is designed to engage both parents and kids.

Keeping in mind the convergence of consumer across the digital and brick-and-mortar platform, we follow an integrated approach to marketing. There has been a shift in shopping patterns from real time product buying from the stores to online shopping.

Owing to this change, we have been committed to provide our customers the comfort of online shopping by increasing our digital platform reach.

Adapting to the change we have geared ourselves for the e-commerce and today we have an established presence on e-commerce website like Myntra, Amazon, Snapdeal, Firstcry, etc. online contributes to about 9 per cent of our sales. It is geared towards going double digit by 2020.

We have also created three differentiated features on the website – 612 Genie (that has surprise offers), 612 Mommy Moments (platform for mothers to share intimate moments with the child), and 612 Icon (achievement oriented).

Apart from this, 612 League is also focused on expanding its digital reach by collaborating with online wallets like Paytm to make payments easier for customers.

Please share your revenue target for the current.

Our revenue target for the current fiscal is Rs 170 crore.

How much does online contribute to your overall sales and what is your target by 2020?

Our online contribution to total sales is roughly around 11per cent in the financial year. The goal is to be a Rs 350 crore company by 2020. We are also focusing on expanding digital reach in a big way. We have an engagement driven website and mobile app. Surprising as it is, but 70 per cent of the traffic comes from the app.

How many point of sales do you have currently and what is your target by 2020?

We have grown from 176 touch point from 2012 to close to 500 in 2017 and we hope to achieve a sale point target of 800 by 2020. The touch points are spread across 150 cities in the country.

Any plans to explore new cities or testing foreign waters on the cards?

This year we opened our new exclusive stores in Vadodara, Ahmedabad, Kurla, Bangalore and Ludhiana. We have also added our presence in UP, Karnataka, Tamil Nadu and Rajasthan through Reliance Trends, Central and Shoppers Stop stores recently. Our best performing markets are Delhi-NCR, Kolkata, Jaipur, Mumbai and Patna.

Our current focus is to expand our footprint within India and not to penetrate into the international market yet.

Please throw some light on your expansion plans.

We have plans to expand our exclusive store presence in west and south in particular. We have plans to target cities like Bangalore, Mumbai, Hyderabad and Chennai.

Any plans to raise the money to aid the expansion plans.

Currently, we are in the process of second phase of funding.

Where do you see the brand five years from now?

The clear cut vision is to become the largest kids wear brand in India. We are a 1Rs 30 crore company right now. In order to become a sustainable household name in kids wear segment we should be a Rs 350 crore company.

Talking of BIG PICTURE: we want to become the last word in kids clothing.