Tap the Accessories Market to Its Full Potential
Fashion has been a significant segment in the evolution of the Indian retail industry, not due to its size but the way it has influenced the Indian lifestyle
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The fashion accessories market in India has traditionally been largely dominated by unbranded players with the Indian Bazar famous for the jewellery stalls. Poets and bards have often extolled the beauty of the Indian Market but in the past few years with the growth of organized High Streets, Malls and Online penetration, we have seen some massive shifts in customer behaviours and the format for trading jewellery. Fashion accessories are a very high growth area as there have been few branded players present in this segment with this having changed fairly quickly in the past few years.
The future looks extremely positive in India with the largest youngest populations in the world. Fashion has been a significant segment in the evolution of the Indian retail industry, not due to its size but the way it has influenced the Indian lifestyle. And with the rising disposable income and consumer's 'Look Good, Feel Good' attitude, fashion accessories are gaining popularity among consumers. Customers are evaluating their spending, more money gets allocated to accessories as they are used more often and can easily complete and change a look.
Characteristics of Market in India:
Probably the single biggest challenge of India is its sheer diversity and heterogeneity of its consumers. As mentioned above, India's consumption is spread across 5500 towns and over 600,000 villages. While there is a strong clustering of consumption across 12-15 major metros and mini-metros, there is a very long tail for the bulk of consumption that makes it an imperative for many retailers and brands to invest in efforts (and be patient enough) to spread out far and wide geographically if they aspire to achieve large revenues from their Indian businesses.
The aspirations and expectations of the consumers are equally diverse, and therefore it's difficult to create retail formats that have a near-universal appeal within India.
Revenue in the Bags & Accessories segment amounts to US$555m in 2019.
Revenue is expected to show an annual growth rate (CAGR 2019-2023) of 18.8per cent, resulting in a market volume of US$1,104m by 2023.
User penetration is 15.0per cent in 2019 and is expected to hit 21.1[per cent by 2023.- KPMG
Areas of Change:
The fashion awareness in India has grown astronomically in the past few years, and the growth in accessories have seen a natural progression. In the past few years, we have also seen consumers moving away from purchasing pure Gold and Silver Jewelry to growing acceptability of fashion accessories and faux jewellery. This allows customers the accessibility to their favourite trends at a cost that works for every segment
With more working women the demand for stylish work appropriate accessories and handbags for work that can also easily transition into after work drinks or an event has also seen a growing demand. Women need and want to look stylish at work, yet want accessories that are hassle free
As purchasing power increases and the need to be unique the desire of customers for personalized products and experience in their shopping continues to grow. Jewellery that can be custom-made, or the customer is part of the Design process has also seen a huge rise as well and we believe this trend will continue to grow. Decreasing pricing and accessibility of 3D Printers will also see revolutionary changes
Social Media and Mobile
India has seen the largest transitions in social factors due to the penetration of Mobile and the Internet. Mobile platforms are expected to influence more than two-thirds of both apparel and fashion accessories purchases by 2022. The growing penetration of the internet, social media and e-commerce is now providing the consumers in tier 2 cities and below, increased access to brands and products, says the "Eliminating Friction in Fashion Path to Purchase' report by Facebook, KPMG and Nielsen.
With the high penetration of social media like Instagram and Facebook, the millennial of today has a growing demand to be able to access and purchase the latest trend instantly. They no longer want to wait to get their favourite looks and expect the retailer to fulfil this demand on their terms: Instantly. Fast fashion has had the greatest impact on the Jewelry business with collections no longer based on seasons but key drops or trends that last a few weeks replaced with something newer and fresher. Brands that can reach out to customers when and how they want will win the accessories market. The design is now the core of every Jewelry brand
Proudly Made in India
As more people start to appreciate the value of our Indian roots we have seen a shift of customers comfortable in their Jeans also sporting ethnic jewellery. Currently, fusion in its many variations is the biggest trend around and will get bigger in future. Our Ethnic brand, Fida has seen exponential growth these past few years, a testament to customers proud and comfortable to wear ethnic Jewelry
Parents today are indulgent and want their children to look at their very best. In recent years we have seen a growing demand for kid appropriate jewellery and accessories. In this category, we have found the price is not as much as a factor as cute and hygiene appeal
Men are not behind
The interesting growth area for us to see has also been the changing Indian male consumer who is slowly becoming as fashion concessions and has returned to his Indian roots where we often saw men as bedecked as their female counterparts. Men today enjoy wearing bracelets; necklaces etc inspired by Bollywood and their favourite Television Serial Actors. Metrosexuality is also back in fashion.
Omni Channel: Accessibility is the new Mantra
New operating models such as Omnichannel and assisted e-commerce could further fuel growth and adoption of online commerce. Despite all the growth of retail on the internet, to broaden the reach, offline stores remain essential. Having made only the slightest scratch in a massive market, we hope that we can continue to grow and access this exciting growth
In the past, as retailers, it was often hard to retail in certain areas due to complicated taxation rules. With the recent introduction of the national Goods and Service Tax (GST) and while it is still being refined, the multiplicity of taxation heads in no longer as big a challenge as before and this has also seen some positive changes
The Accessories market in India is on an exciting growth trajectory with key factors creating a growing market for brands. Ultimately the brand that can continue to be exciting and relevant, reinventing itself to keep pace with the changing customer is sure to become a cult favourite.