Flipkart-owned app-based fashion store Myntra has recently launched a new fashion brand ‘All About You’, designed exclusively for it by actor Deepika Padukone, and expects it to hit the $ 100 million mark in the next two years. Overall, Myntra has set itself a gross margin target of a billion dollars, and expects to achieve it sometime in 2016.
In an exclusive interaction with exchange4media, former McKinsey director Ananth Narayanan, the new CEO of Myntra, and Abhishek Verma, business head of Myntra Fashion, talked of the association with Deepika Padukone, their festival target and marketing strategy, and challenges faced in the app-only model. Excerpts:
What are your expectations from this tie-up with Deepika Padukone? What will it do for brand Myntra?
Ananth Narayanan (AN): The ‘All About You’ brand will widen and deepen our reach. We expect to make it a $100 million brand over a period of two years. I think it is a very unique value proposition for 18-to-35-year-olds, which will help us to continue enhancing the Myntra brand overall as a discerning fashion destination. This association will help us a lot, and live up to its promise of being a collection that connects with young women.
What is the kind of marketing that you plan to do around it?
Abhishek Verma (AV): We are present on all media platforms. Since we have launched the brand, we are present on TV, Outdoor and Digital media as well.
What is your engagement level with non-metro non-English speaking consumers who are more inclined to the vernacular medium?
About 55% of our traffic comes from Tier II cities. So as we think about newspapers, we do think of the vernacular medium.
What are your expectations from the festival season ahead? How do you plan to take on the intense competition?
AN: OND (October-November-December) is historically unrest season. We have been off to a great start. My sense about why we will do well is because we have several brand concepts coming ahead. We have lots of new product features that will be interesting for consumers, and will make sure that they keep coming back. We have an interesting marketing campaign around ‘Why Shop with Us’ that will go live soon.
More than anything else, just look at our selection. We believe that our selection is completely fresh and interesting. We have the best set of brands for our customers. That is why we will do well.
What are the challenges you have encountered so far after Myntra went app-only?
AN: Mobile is growing disproportionately. That is a fact and every six mobiles are equal to one desktop. Plus there is a 10% decline in desktops. So I think in the long term, mobile is the way to go. The reason for the move was that we wanted the company to be oriented around mobile, and basically stay in touch with people. Secondly, the app allows you to personalize things, which is not possible on the desktop site. What that means is that what you see when you open the app will be different compared to what I see when I open it. That is a very interesting consumer proposition. So, we intend to win big on mobile.
AV: Also if we talk about going the app-only way, it is still early days for us. We should expect to see our new set of product features on app in about a month. We are truly leveraging the power of an app.
Since you launched the app-only model, what has the adoption been like? What are the kinds of consumers that have been coming on to your app?
AN: The distribution of consumers has been roughly and not dramatically different.
AV: I think primarily since we went app-only, we have seen the average engagement levels of our consumers go up significantly. They are spending more time and they are engaging much more. And as a result of that our commerce has also been impacted.
What is the revenue figure that you are looking at this festive season?
AN: We will try and get a billion dollars gross margin in 2016 sometime. That’s the goal. We do calculate season by season and set targets, but cannot disclose those figures.
Could you tell us about your overall marketing strategy and whether it has been recalibrated?
AN: Not much change in our strategy but one interesting thing we have done is to get into a lot of digital marketing, where we are able to target consumers. We are able to personalize it. We are able to get to the Myntra value proposition very quickly and clearly. You know about our partnership with Facebook. I think that works very well. We have to make sure that we provide a lot of value to the consumer. That’s an ongoing experiment.