Fashion in India part II: Breaking into the mass fashion market

Pictured: H&M store. Credit: H&M
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As we explored in our column last week, the luxury market in India is a space full of opportunity, as international fashion houses have been able to penetrate the market by simply bringing across their global designs. In global luxury fashion space, there is a level of homogeny. But, for those that are not part of the top one to two percent of consumers in India, it is not luxury that will be their go-to, but, instead, mass fashion.

“In order to expand further outside of the major cities, it is key that international brands consider that their European segmentations will need to alter to suit the sub-cultures that exist within Indian society.”

When thinking about this market in Europe, it is brands like Zara, H&M and M&S that are at the forefront, but in India, fashion retailers like Zudio, Azorte and Westside are particularly popular for the majority of shoppers. To get an idea of scale, between them they operate nearly 800 stores across over 250 cities nationally.

Zudio is the largest of the three, and is owned by Tata Trent, which reported a revenue of around $780m for FY24 and creates affordable fashion that is predominantly targeted towards Gen Z with women’s, men’s, loungewear and ethnic categories available. Westside, also owned by Tata Trent, is known for its affordable fashion, offering a range of apparel, footwear and accessories for men, women and children, while Azorte offers ‘western wear’ and ‘ethnic wear’ at a low to mid-range price point and although it has far fewer stores, it is part of Reliance Retail which saw gross revenue of around $37.1 billion in the same period. For the majority of the Indian population, this is where they shop because the brands are accessible and understand the sub-cultures that are unique to India.

For affordable to mid-level European brands, penetration of the Indian market is tougher. In tier 1 cities – like New Delhi, Mumbai and Bangalore – the likes of Zara and H&M are becoming more and more prevalent, but outside of these cities, they have practically no presence. Of Zara’s 20 stores, 14 are located in tier 1 cities whereas there is only one in a tier 3 city, and of H&M’s 43 stores, more than 60% are located in tier 1 cities. In order to expand further outside of the major cities, it is key that international brands consider that their European segmentations will need to alter to suit the sub-cultures that exist within Indian society.

Sanjeev Mohanty, who has had experience working across both the US and Indian markets and was most recently Managing Director of Levi Strauss in the US & Canada, tells us: “The way segmentation is done in more evolved markets like Europe and the US is through micro-segmentation. For example, skateboarding is a big streetwear trend or surfing which is part of the outdoor segment.” But this kind of segmentation doesn’t exist in India, as the consumer needs are different, so for international brands to truly penetrate the market they will need to adapt their offerings to fit.

However, this also brings up the dilemma of how far brands should go in trying to tailor their output to the consumer. Sanjeev explains: “The question is, how much localisation do you do? Over-localisation could be dangerous because it can alter the brand DNA and create dissonance with the consumer but just the right amount could be perfect for creating a niche for connecting with consumers. It’s a delicate balance.” For example, altering collections that are available in other markets, or launching them later, could switch off consumers and make them feel as though they are lagging behind.

Having said this, European fashion brands are continuing to enter the Indian market. M&S was opening a store every month as it continued to build on India as its largest store network in the international market, while ASOS, partnered with Reliance Retail last May to launch its own brands –  including ASOS Design, Miss Selfridge and ASOS Luxe. Inditex (which is the parent company of Zara) also confirmed in early 2024 that it was bringing Gen Z affordable fashion brand, Bershka, to Mumbai, opening its first store on 1st November last year. With a so-called ‘youth bulge’ (around 66% of India’s population are below the age of 35) and a swelling middle class, these trend-led brands entering the growing mass fashion segment makes sense.

It is clear that, particularly in tier 1 cities, there is a place for international high street fashion brands to make their mark in India especially as the world continues to become more connected and the population younger and more trend-led, but there is still some way to go before they can truly embed themselves in the entirety of the market and create an impact outside of the bigger cities. In comparison to the luxury fashion brands that have found more fluidity in both Indian and international markets, mass fashion retailers appear to be a number of years behind in both respects. However, despite this, it feels as though there is real opportunity in the space for an international fashion brand to break through – the question is, who will it be?

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