In few months of Jabong’s acquisition by fashion portal Myntra in the same domain, the latter is aiming combined net revenue of more than $1 billion by March’17. This instruction was given by Flipkart who now controls almost 70 per cent of total online fashion market in the country after the takeover. The e-commerce giant is looking to expand revenues in the shortest possible time with both Myntra and Jabong running as separate entities but would be leveraging each other’s strength wherever required. The net revenues of the two companies were estimated at $500 million last year, according to reports.
So with its sight on profitability which includes bringing in net revenue of more than $1 billion, according to media reports, Myntra already has its strategic moves in place. It is reported to move the research and development team of Jabong in Bengaluru to its own facility in less than two months of takeover. It had acquired Bengaluru-based mobile content aggregator Cubeit in July for an undisclosed amount and took a majority stake in clothing and shoes brand HRX, launched by actor Hrithik Roshan, to give a fillip to its private brands business. It has also tied up UK-based fashion retailer French Connection.
Recently to boost its international portfolio, Myntra has associated with Italian brand Love Moschino which is a younger counterpart of the internationally acclaimed Moschino. Now the fashion major houses over 30+ top global brands. The online retailer is also looking to build a combined omni-channel strategy that includes both online and offline services. So over a couple of months, Myntra plans to open brick-and-mortar stores to sell its private labels including Roadster, HRX and All About You, under Myntra Fashion Brands. While it’s reported that private labels accounted for 20 per cent earlier this year, Myntra is aiming to bring the share of these brands to 30 per cent by the end of current financial year.
With Myntra’s aggressive steps, Flipkart is betting big on fashion where it has the prerogative -- Myntra controls 70% of the online fashion retail market -- and the margins are as high as 50 per cent to turn the entire company profitable in the near future. But Amazon, in an attempt to take its competitor heads-on in this high-margin space, has launched the first of at least six fashion private labels which it proposes to introduce this year. Called Symbol, it is launched by Cloudtail India, Amazon’s largest seller, through which the US e-commerce major is gearing up for the upcoming festive season.