Ethnicwear industry remains traditionally an unorganised segment but has demonstrated steady growth over the past years. Industry experts say it is set to grow further by 8.4 per cent over the next decade from the present Rs 61,679 crore, or US $11.63 billion.
Modern retail, especially large format retailers, are ramping up their expansion plans across metros and even taking it to tier I and II cities. This factor will contribute significantly to the growth of the Indian ethnicwear market.
Women First
The women’s segment currently accounts for an overwhelming 87 per cent of the total ethnicwear market at Rs 54,425 crore (US $10.26 billion); the growth of this segment alone continues to boost the performance of the overall sector. Within this decade alone, ethnic womenswear is expected to grow at a steady rate of 8 per cent.
Even kids’ ethnicwear has been seeing a growing curve with the next few years expecting to see a 10 per cent increment. Even within this niche category of children’s ethnic outfitters, girls’ ethnicwear market is two and a half times the size of the boys’ ethnic market.
While the market for men, presently at Rs 1,623 crore (US $305.82 million), is expected to grow at a CAGR of 8.5 per cent, this will largely be within high fashion as it is a high value segment that is heavily guided by occasion-based purchases.
The opportunities thrown up by the wedding or bridal market in India are tremendous. Right from local boutiques to established traditional retailers and regional brands, every bridalwear retailer is vying for a share of the loyal consumer’s wallet in a market that is governed more by design than brand. Exclusive ethnic brands such as Manyavar, Diwan Saheb and Vastra are few players that have managed to command a premium for their services.
Festive Gamble
Owing to the religious and cultural diversity of India, a wide range of occasions are celebrated. Such celebrations typically start early in the year in January, when Northern India celebrates Lohri, and culminate around October-November with Dussehra and Diwali. On such festive occasions, consumers tend to purchase ethnicwear for both personal use and gifting purposes, as brands typically bring out new trends and designs to coincide with a festive occasion. These occasions typically drive the growth for women’s, kids’ and men’s ethnicwear. Business is buoyed by periodic sales that spring up during festive season.
Slow and Steady rise
Ethnicwear was initially a category that was largely restricted to an older age segment. However, it is now finding acceptance even among younger consumers, especially women. The young college going girl teams her Indian kurti with a pair of jeans or leggings representing a fusion of ethnicwear with westernwear. This has led to brands offering products that are a mish-mash of ethnic fusionwear in western styles and prints, in order to capture the opportunity. With an interesting interplay of wovens and knits, these brands have completely redefined ethnicwear for younger consumers.
Ladies across all ages prefer salwar kameez as it is convenient, comfortable as well as adaptable to changes in fashion trends. One of the key emerging trends contributing to the growth of this segment is the gradual increase in the number of women in the corporate workforce. Many brands had anticipated this and made suitable changes in their respective product portfolios.
Thus it is not surprising that within ethnicwear kurtas and salwar kameez, which represent 38 per cent of women’s ethnicwear market, are expected to grow at robust rates in the next decade. Currently at `20,700 crore (US $3.90 billion), the salwar kameez category is poised to witness optimistic growth at a CAGR above 10 per cent.
Manufacturers Adapted
Although traditional markets shall continue to be of importance, a consequence of the above factors is the increasing salience of modern formats among consumers. Until modern retail opened its doors for urban consumers, local tailors and neighbourhood boutiques were satisfying the ethnicwear needs of most consumers. Large format retailers were unheard of. Further, these local tailors barely met standards in terms of quality and designs. With the coming of modern retail, consumers have easy access to branded products that straddle the tiered pricing segments. In the value segment where few organised brands have been able to make a mark for themselves, large format retailers such as Reliance Trends, Max and Big Bazaar offer private labels. In the premium segment, there are national players such as BIBA and W, to name a few, while strongly entrenched local players dominate their respective geographies. Neeru’s in Hyderabad, Frontier Bazaar and Bombay Selections in Delhi and Jashn in Mumbai are some examples.
Popular LFS formats such as Shoppers Stop, Lifestyle and Westside are increasing the width of the private label offering and offer the consumers contemporary styling as well as convenience of comparing multiple brands under one roof.
A very crucial pocket of growth will be the demand from small towns which are the metro cities of the future. A large number of brands are already eyeing this opportunity. Miraaya, for instance, has a strong presence in tier II and III cities both through its EBOs and large formats. BIBA has also opened a large number of stores in tier I and II cities such as Vadodara, Indore, Patna, Visakhapatnam, Agra, et cetera. However, the demand for ethnicwear is large even within these cities and this demand frequently drives small town consumers to big cities for their shopping requirements. The onset of the e-commerce revolution is also changing the game. Consumers are able to purchase many, if not all, popular ethnicwear brands from the comfort of their homes.
Limitless Platforms
With many brands setting up online stores and others selling through online portals, customers who do not have access to brick and mortar stores can purchase the brands online. Though there are issues that need to be ironed out before the online space emerges as one of the preferred shopping destination for ethnicwear, many ethnicwear brands have started to think of their online presence as a viable sales channel rather than just a website.
As different channels continue to emerge and evolve in the ethnicwear market, the growth of brands will be largely dependent on their ability to differentiate themselves across product and service offerings.
ABOUT THE AUTHOR
Amit Gugnani is currently the Senior Vice President of Fashion (Textile & Apparel) and Engineering division. He has over 14 years of experience in apparel manufacturing. Pakhie Saxena, Associate Director, Retail & Consumer products division, has over 12 years of work experience. The views expressed in the guest articles are those of the respective authors. The editor and publisher may not necessarily subscribe to the same.
