The Omnichannel conversation is not about offline vs online. Whether you are a new brand or an established one, every retailer needs to focus on how to converge both platforms to maximize traffic for the brand…
Which kind of products sell better online? Do customers worry about which channel they buy from? How are brands selling online today? How to manage brand promise on marketplaces? Are luxury products a good fit to sell on marketplaces? Can retailers collaborate with marketplaces? Why are online retailers setting up stores? Are the challenges different for them? How can brands go cross border?
These were some of the questions that an elite panel comprising Jaineel Aga, MD & CEO, Planet Superheroes; Meheriar Patel, Chief Technology Officer, The Mobile Store; Mike Ghasemi, Research Director, Retail Insights Asia Pacific & Head of WW Hospitality & Travel Insights, IDC Singapore; Pallav Atreja, Business Head – EBO & E-commerce, MAS Holdings; Pooja Maheshwari Salwan, Category Head – Fashion Tech and Gadgets, Ajio.com; Riya Vipan Kalra, Co-Founder, Candyskin; Sauvik Banerjjee, CTO, TataCLiQ, Vice President, Tata Industries – Digital Initiatives, Advisory to Group Cos; and Shivani Poddar, Co–Founder, Faballey.com, tried to answer in a session titled ‘O To O: What Does It Take to Win the Omnichannel War’ powered by Vinculum.
The session was moderated by Venkat Nott, Founder and CEO, Vinculum Group.
Venkat Nott kickstarted the debate by talking about Vinculum Group. “We are a software company enabling multi-channel retailing. At Vinculum, we created a platform which integrates into 30 plus marketplaces and 50 plus logistic companies that facilitates selling in any part of the world for retailers. Each marketplace has a specific requirement for products and it takes retail companies a long time to get their products specific-market ready. We are trying to solve this problem for the retail industry by automating it.”
Vinculum has also created a set of tools which facilitates a real-time view of the inventory for stores and warehouse which is fundamental to enabling Omnichannel commerce. The company provides retailers with a 360-degree Omnichannel experience with the ability to actually make money out of it.
“This is the perfect time for the Indian industry to leapfrog into the Omnichannel space, to go every step of the journey and we could do this in two to three years,” he stated.
The Omnichannel Journey
Shivani Poddar spoke about FabAlley’s model saying: “We started as an online brand about five years back, and we do everything for women from the age group of 20-35. We’ve recently launched a new mobile-enabled app, in keeping with the evolving consumer. We have also started expanding offline. We have 50 shop-in-shops as well as our own stores. We are now amongst the market leaders in the online space.”
“For us, the competition comes from brands. From an offline and online point of view, we compete with everyone, from Zara to Myntra to Amazon. Along with this, we compete with roadside retailers as well who sell a top for around Rs 500-600 on the streets. However, we don’t compete with marketplaces. They are our channel partners, our distribution channels and we work with them as they increase our sales.”
“From a retail point of view, we have tied up with the large format of store and distributors, who are also our channel partners. Our online stores produce the larger part of the business around 40 to 45 percent. We also work with a bunch of distribution partners which gives about 35 percent of the business and remaining 20 percent is offline for us,” she added.
Pooja Maheshwari Salwan took over from here, talking about Ajio.com. She said, “Ajio is the online website of Reliance Retail. Our competitors are not the likes of Flipkart, and Amazon; we are more vertical, so we look at the likes of Myntra, and Jabong as our competition.”
She described Ajio’s storyline saying, “We are more curators and we prefer to house premium merchandise at affordable prices. We want our customers to feel that they are looking at the best available products in the market in a certain price bracket.”
She explained that it was not just online retailers who collaborated with Ajio but offline retailers are well since that helped increase sales.
The Omnichannel Lingerie Model
Pallav Atreja of amante, explained the model saying that his was a premium, intimate-wear brand.
“We launched the brand in India in October 2007, and it’s been an incredible journey so far. We started the journey from MBOs and we have grown into the market, evolved to large format stores, to launching our own website three years ago. One-and-a-half years ago, we started our own EBOs. Basically, we’ve evolved into a multi-channel brand and online now accounts for 15 percent of our revenues. We see it growing and settling down at 17-18 percent as we grow. For now, we are working towards combining all these channels and giving our consumers an Omnichannel experience,” he stated.
The brand – which started in Sri Lanka – already has 11 EBOs in India. By the end of this year, they plan to take this number to 15 and next year, add 15 more stores.
“India is going to be the center stage of our expansion and Omnichannel plans. Apart from that, the target is to cover the entire South Asian market in the next couple of years. So, by 2020, we hope to be present in all the eight-country market of South Asia,” he explained.
Riya Vipan Kalra of Candyskin entered the discussion at this point saying, “Candyskin is a lingerie brand which was launched in January 2017. Currently, we are present in 45 offline stores and 13 portals plus our own website.”
She said that a big chunk of their sales came from offline channels – specifically the MBOs who have Candyskin fit consultants. “These are consultants who represent the brand and help the consumers put a face to Candyskin. We are also working on to increase our online presence by approaching more portals,” she added.
Exceptional Brand Journeys
Sauvik Banerjjee, CTO of TataCLiQ and Vice President, Tata Industries – Digital Initiatives, Advisory to Group Cos spoke about his brand saying: “When Tata Group ventured into the e-commerce space, the intent was not to become a pure play marketplace, especially since we were late entrants to the e-commerce marketplace. The intent was to ensure that we showcase the brick-and-mortar retail brand online while fighting the online discounts war – figure out if online discounting was at all achievable.”
The brand has been online for almost a year-and-a-half now, with about 1,000 brands onboard. TataCLiQ has even started a parallel electronics e-store, moved into accessories, kids, as well as luxury verticals.
“Everything that have online is shipped from the store and is part of our click-and-collect model. We want a seamless Omnichannel model to ensure that our brick-and-mortar retail dows not suffer in this offline to online conversation,” Banerjjee said.
“TataCLiQ is kind of a physical mall, where stores are connected. We are integrated with Vinculum and the intent is to ensure the efficiency of logistics. It’s a consumer engagement thing,” he said, adding that the brand is currently focusing on a ‘ship from store’ model – based on consumers selecting products online on the availability of their products in the proximity of their pin codes.
“We ensure that the product is delivered from the nearest possible store. Both delivery and returns are much more logistically convenient then,” he stated.
Meheriar Patel of The Mobile Store took over from here saying, “In 2015, when I joined The Mobile Store, it was a traditional brick-and-mortar retailer with 1,500 stores, no online concentration, no app journeys. We wanted to service our customers better. So, we designed an App called ‘Fastest Express Delivery’. This app now brings in 30 percent of our revenue.”
He says that faster delivery is just one of the services the brand has souped up in the recent past.
“Through our app, we provide end-to-end operations, great logistics and stock availability. Having said that, I feel technology alone is not the only thing which has played a big part in helping us grow. Operational efficiency, supply chain, as well as real-time technology are all helping us big time to achieve a growth scenario,” he stated.
Planet Superheroes, a small, five-year-old company which is in a sense, a license character merchandising company works on the philosophy that, whether India or anywhere in the world, customers don’t buy channels, they buy brands and they buy products.
“One has to ensure that a particular product fits a channel. When we started online, it was the best way to test out something so niche and it worked fairly well. But then we realised that over time, the cost of acquisition online starts diminishing returns. It goes beyond the rental cost offline. This was one of the reasons we decided to venture into traditional retail,” said MD & CEO, Jaineel Aga.
“Another reason why we are going offline is that we need to develop customer interest in our product and that can only come with channel partners and distributors. We need to create brand awareness,” he added.
Consumer Engagement, Market & Technology Trends
Mike Ghasemi of IDC Singapore plunged into the discussion at this stage, saying, “I come from IDC and what I do is to focus on retail industry trends. We do lots of surveys and technology observations and micro-economy research as well. Looking at the retail perspective in Asia or India, we see a common trend – all retailers are working towards improving customer experience. They are using new and improved technologies to engage consumers, both pre-and-post purchase. They are also keeping track of customer behavior, and his shopping journey.”
“IoT is now becoming mainstream. It’s helping retailers understand how the customer is engaging with brands, finding the location of the customer, the time that a customer spends on products and the areas which the customer concentrates on within their stores,” Ghasemi added.
He also explained that customers who shop online and offline have very different profiles. “The customers that shop online are obviously more tech-savvy – the ‘always connected customers’. They look for the best deals, they want to stay connected with the brand all the time, everywhere, and they are extremely demanding. Meanwhile, consumers who prefer traditional retail have a very different profile. They have a brand loyalty, product experience is important to them, but at the same time they have high expectation in terms of store technology. It is important how the store assistant helps / treats them,” explained Ghasemi.
“According to him, the Omnichannel conversation is not about offline vs online. “Whether you are a new brand or an established one, you need foundation otherwise you are just trying your luck. In my opinion, when you set up a business, you should focus on how to converge both platforms to maximize traffic for your brand,” he concluded.