Online retail store shopnineteen.com was launched in March 2012, and ever since has been growing at a quarterly rate of 40 percent. Coupled with great pricing, the web store has established itself as the fastest growing online fashion brand for women in India. In conversation with IMAGES Retail Gobind Singh Pahwa, MD, shopnineteen.com shares the brand’s journey so far. Excerpts…
When did shopnineteen.com begin its operations? How important is e-commerce today?
Nineteen was conceptualised in the summer of 2011, when we were looking for avenues to diversify our interests from exports and cater to the domestic Indian market. We wanted to bring forth a private label that would cater to the needs of young women, providing them the latest trends at affordable prices, while incorporating international quality standards.
The Indian middle class of 288 million people is equal to the entire US consumer base. This makes India a real attractive market for clothing e-commerce since it is one of the most searched categories not just in India but globally too. Moreover, considering extremely high rental and management costs of a physical store, it makes good sense to launch a brand online.
What are the highlights of your e-commerce strategy?
Since the launch, our brand created a space for itself due to its diverse designs and international trends we brought to our customers. Being an online platform, our focus has always been the digital space to communicate with our customers.
Talking about our promotion strategy for the brand, we are using only social media tools for brand promotion. Starting with Facebook, shopnineteen.com was very swiftly present on almost all social media platforms, including Pinterest and Instagram.
The social media strategy that we follow is to engage consumers by reflecting the intrinsic values of our brand ‘Nineteen’. At shopnineteen.com, we have a certain personality of the brand; a certain thought process that we want to bring to the consumers to highlight what goes behind making their favourite brand. Also, a lot of exciting contests, discussions, participative engaging posts, etc. are a regular feature here if you are connected with us on social media.
What is the profit ratio for shopnineteen.com? How is this figure going to change in future?
Since the inception of shopnineteen in March 2012, we have been growing at a quarterly rate of 40 percent and since we manufacture ourselves and sell directly to the end consumer, we manage to keep 40 percent to 50 percent margins. Currently, we get close to 25,000 women on our site daily, who shop for close to 600 pieces a day. As far as breaking even is concerned, we hope to do so by 2016.
How is the overall performance of the brand and are you satisfied with it?
In the last two years, we have grown our presence in the e-commerce industry. Today, we have 25,000 women visit our website daily and we service 26,000 pin codes in India with an average of 600 order deliveries per day. This figure is expected to double within 3 months.
Keeping in mind our limited resources, both human resources and financial, we have done considerably well in a short span of time and endeavour every day to be the best private label for young women in the country.
What is the average ticket price online? Which items are popular with customers for buying online from your website?
Our average ticket price would be Rs. 500 and our top selling category is tops.
What are the main trends you have witnessed in terms of online behaviour and e-commerce on your website?
Over the last few years, India has witnessed tremendous growth in the smart phone segment, which has changed the way people used to shop in India. Today, customers come to our portal not just for convenience factor, but also look for international designs at affordable range. Also due to the exposure on television and the Internet, customers have good understanding of new fashion trends and know what they want. Of late, we have seen that customers have become more participative and come up with really concrete feedback.
What are the main challenges you face in running an online operations successfully?
Our journey has been a great learning experience. Coming from a completely different industry, it was difficult initially trying to optimise the costs and processes. Logistics is a big hassle in India and we pay heavily for that too. We tried using economical courier partners at the outset to optimise costs. However, we ended up with delayed deliveries, wrong statuses, etc. To better our customer experience, we switched over to better courier partners that had a good TAT and we also set up APIs with them to enable customers to get access to tracking their shipments.
We are also one of the very few online retail brands to have a supply-chain management tool installed in the backend to note every single movement of fabric to final dispatches of goods. This helped us reduce pilferage, massive time management and exhaustive data points to analyse and perpetually improve too.
We have recently added PLM software to further improve tracking of the product life cycle and to further automate the work process.
Over the past two years, what are the changes that you have made in your operations?
Over the last two years, we have been constantly working on improvising customers experience at various levels – from giving our visitors a seamless shopping experience on the website to strengthening our delivery system.
In this fast-changing e-commerce industry, one needs to keep evolving continually and implement better practices as and when the need arises.
According to you, what is the future of e-commerce in India? How does shopnineteen.com plan to evolve in it?
According to a recent report, India’s e-commerce market, which stood at US$ 2.5 billion in 2009, reached US$ 8.5 billion in 2012 and rose 88 percent to touch US$ 16 billion in 2013. The survey estimates the country’s e-commerce market to reach US$ 56 billion by 2023, driven by rising online retail. Keeping in mind that Internet penetration in India is a mere 10 percent, the future seems extremely bright for the online industry as a whole.
Our strategy is to be the foremost fashion-label choice for young Indian women. We endeavour and work consistently towards our goal each day by bringing in best practices and experiences.
Tell us about your future plans?
In 2014, we are focussing on a faster turn-around time to launch new products and to add an array of products to the current as well as new product lines.