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July 11, 2013
Shefalee
Vasudev, Mint (A Wall Street Journal Partner)
New
Delhi, July 11, 2013
Just
when the word “boom” has begun to sound believable in
the context of India’s fashion industry, the soaring success
of Zara, the world’s biggest symbol of industrial fashion,
proves how polarized India is as a shopping republic. It turns
the competitive game of ready-to-wear retail into a foxing ball
game. Every retail brand here is pushing at the exclusivity factor
through brand presence, sponsorships and advertising. Yet what’s
really selling is commonality, with every 12th person having the
same satin pyjamas, oversized bags, Oriental print shirts and
tweed jackets.
On the big scale there is little or no difference between us
and the mass shopper in Denmark, Venezuela, China or Canada. That’s
what the latest annual report of Inditex Trent, the joint venture
between Zara brand owner Inditex, a Spanish company, and the Tata
group’s retail arm Trent, indicates.
Zara recorded 56% sales growth, an annual sales turnover of Rs.405
crore through nine existing stores in India, in the 2012-13 financial
year. This puts it not just ahead of the country’s top apparel
brands but ready-to-wear prêt made by fashion designers.
This story has echoed earlier in other parts of the world, where
Zara beat giant fashion chains like H&M and Topshop, but with
apparel brands in India like Shoppers Stop, Westside, Louis Philippe,
Allen Solly or ColorPlus barely managing a grip on the tightrope,
its success raises new questions on retail competitiveness. Set
to stock ready-to-wear by the handloom-loving designer Aneeth
Arora (Pero), who won the first Vogue Fashion Fund award, from
next month, Wills Lifestyle, which also sells creations by other
Indian designers (usually insipid mini collections), may have
to do a lot of process work to compete with Zara. As will those
like Ritu Kumar’s sub-brand Label, which offers good price
competitiveness in the ready-to-wear segment.
“I don’t remember the last time I went to a Wills Lifestyle
or Allen Solly store and yes, I prefer Zara to any other Indian
fashion brand,” says 27-year Raashi Sikka, a television professional
who till recently worked with event management company Wizcraft
International. A self-confessed shopaholic who wears Zara at least
five times a week and goes to Zara stores about thrice a month,
she says she finds the brand stylish, comfortable and buzzing
with new stock. Sikka adds that for a single working woman, Zara
is worth the money, even if durability is not among the brand’s
strong points.
Girlie gush pours out of Zara fans. Like 23-year-old Ankita Grover,
who works for e-commerce website Jaypore as a merchandising assistant.
“I insist on Zara gift vouchers for my birthday and other
occasions,” says Grover, adding that while her usual budget
is Rs.2,000-3,000, if she had Rs.20,000 in a certain week she
would still spend it at Zara—she visits the store every week
to look around, if not buy. She even got Zara vouchers for her
parents on their wedding anniversary, knowing all too well that
they would be passed down to her.
Confessions that make 24-year-old Neha Varma smile. She is from
the same flock, describing Zara as her PMS pill. “I have
never felt the heady rush as I did when Zara first opened in India.
I go very often and save carefully for the expensive items,”
she says. Varma too prefers Zara over Western prêt made
by Indian designers.
Fast, funky, stylish, trendy and exciting, with something new
to offer every week, stocking everything from separates to casual
basics, jackets to layering options—this vocabulary has exhausted
and enlivened Zara buffs the world over ever since the brand from
Inditex SA first launched in 1975. The subject of numerous business
case studies globally, Zara thrives in the midst of global fashion
by being trendy but never original; yet it always puts out its
reproductions before the international catwalk collections make
it to the stores. It is now bought voraciously in more than 80
countries in the world, through about 1,800 stores. Eighteen more
stores will be added in India this year.
“Amancio Ortega Gaona, the founder of Inditex, thought
that consumers will regard clothes as a perishable community just
like yogurt, bread or fish, to be consumed quickly rather than
stored in cupboards, and he has gone about building a retail business
that makes freshly baked clothes,” wrote Devangshu Dutta
in “retail @ the speed of fashion”, a case study on
Zara for Third Eyesight, a specialist consulting firm on consumer
products and the retail sector.
Many experts have tried to analyse the secret of Zara’s
success. It all boils down to the brand’s ingenious utilization
of store staff everywhere in the world to share customer feedback
instantly, helping it cater to fast-selling trends in a short
time and simultaneously create a lovable problem of plenty for
the buyer. About 1,200 styles in 26 collections swim out to Zara
stores every year. “Their formula of success lies in production,
it is based on the fastness of DHL couriers, to use a metaphor,
and McDonald’s taste and tango all at once,” says designer
Hemant Sagar of the duo Lecoanet Hemant. Even as the top design
houses in the world now invest in research and development to
create products that would be difficult for Zara to match, Sagar
says Zara’s retail model makes India’s “cultural
hand-me-down mentality” worth reflecting upon. “India’s
identity crisis in designing, dressing and shopping that reflects
in retail is a long way from getting resolved,” he says,
adding that no big name will come out of India until designers
begin investing in technology as a priority.
Zara suppliers too swear by its incredibly fast response time.
“Zara outsources most orders to India between August and
April and their teams work rapidly from one stage to another,
from fabric sample to product and clearance in a matter of weeks,
if not days,” says Shriram Goyal, managing director of Dhruv
Global, a knitting apparel company, one of Zara’s many manufacturing
suppliers from India. Zara’s trendiest items are made closest
to home in Spain, so that the production process takes only two-three
weeks. The rest is done in other markets. Goyal explains how Inditex
outsources manufacturing to countries based on market strength,
like beaded and embellished work to India, polyester and other
prints to China and tailored stuff to Bangladesh, where labour
is cheapest.
Industry veterean Alpana Prasad, director of ESSquare, an Indian
buying agency which supplies to a classic, ready-to-wear brand
from the UK and competes with Zara in world markets, agrees. “Zara’s
inter-departmental linkages are excellent and their designers
are constantly on their toes. They invest in technology and fabric
development, offering about 500 colours across different styles
every year,” says Prasad.
Inditex founder Ortega, now retired, has famously never given
an interview, nor has he paid any star to endorse his brand. The
brand keeps the media at arm’s length, allowing only select
spokespersons to make occasional comments. Yet fashion websites
all over the world and magazines feature celebrities in Zara alongside
the globe’s top trendsetters swathed in luxury brands, elevating
its value. Indian fashion blogs like High Heel Confidential regularly
show celebs in Zara, the most recent being actor Madhuri Dixit
in a printed shirt arriving at the International Indian Film Academy
awards (IIFA) festival at Macau on 7 July.
It makes it a deep pool for Indian brands and designers to swim
in. The former may need completely reinvented platforms of display,
retail and sale to come anywhere near creating a fast-fashion
brand and the latter may just have to accept that their creations
will remain a niche aspect of fashion buying even in their own
country.
