Feature

Mapping the Gap

Aided with data on consumers, analytics on need gaps and waning brand loyalty, e-tailers abandon discounting to climb on to the private label bandwagon

Illustration Kishore Das

A 100 new categories across its eight private labels — that’s the target Adarsh Menon, head of private labels at India’s largest e-tailer, Flipkart, has set for his team for 2018. Meanwhile at Myntra, Flipkart’s subsidiary and leading fashion portal, Manohar Kamath, who heads the portal’s fashion brands, is thinking about increasing its portfolio of private labels, which is currently at 13, to 18 by the end of the year. Manish Tiwary, vice-president, category management at Amazon India, emphasises that private labels are an “important avenue” to give customers what they are looking for. 

Zivame, the online lingerie retailer, started as a marketplace with multiple brands in 2011 and launched its private label journey in 2013. It now has 90% of its business coming in from private labels. The Aditya Birla Group, which shut down its online fashion portal, Abof, a few months ago, is planning to relaunch it with private labels. 

Big e-tailers are not the only ones who are going big on private labels. According to media reports, online home services firms, UrbanClap and Housejoy, are planning to launch private labels in categories such as spare parts for home appliances and even beauty services. Even GoCoop, a social enterprise and online marketplace that connects rural artisans to local and global customers, launched a private label called The Good Loom at the Lakme Fashion Week in February.

What, then, is the lure of private labels? “The logic for indulging in private labels is simple. They give better gross margins to retailers across the board. Also, independent brands are unable to cater to all price points and consumer demands. Private labels address such need gaps,” says Ankur Bisen, senior vice-president at Technopak Advisors, a management consulting firm. “With large amounts of transactional and behavioural data, e-tailers are often able to identify these gaps quicker than other retailers and brands,” adds Devangshu Dutta, chief ex

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