E-commerce retail Sep, 09 2011

Offer the best deal for maximum returns

Though quite popular globally, online retail is picking up fast in India as well. The online retail sites are not only offering comfortable shopping experience, but also offering a lot of special discounts to lure customers. Franchise brands too are also

By Abha Garyali
Sub Editor
Offer the best deal for maximum returns

Shopping has undergone a tremendous change in the past few years. From going to markets to buy stuff, now customers can easily get all branded stuff delivered at their doorsteps. This has become possible due to the number of websites that sell branded products as well as services at half their original prices. This has started attracting more customers to opt for online shopping. Seeing the popularity of such deals and websites, many established, emerging as well as debutant franchise brands also offer deals online.

Booming e-retail websites

Retail websites have seen a sudden splurge in the last few years. The main factors contributing to the popularity of online shopping are growth in disposable income and changed mindsets. Pearl Uppal, CEO, Fashion and You feels: “When it comes to shopping, people these days are willing to take a chance with online shopping. Moreover, e-commerce companies are also going out of their way to offer a consumer not just a product, but a different experience.” Another factor can be with the widespread of the Internet, everyone wants to be a part of this e-revolution. Sanjay Ramakrishnan, Senior Vice-President, Marketing, Myntra.com, says: “Biggest advantage of shopping online is the ease of shopping. Online shopping also offers diverse options than an offline retailer. And a customer is offered with more choices of brands and styles. Also, unavailability of favourite brands at shopping malls is fuelling the growth of e-commerce in India.”

Online deals and franchise brands

The e-commerce websites not only offer branded products but also sell them at reasonable rates, which are far below the market prices. E-retail sites like www.snapdeal.com, www.fashionandyou.com, www.sosasta.com, www.myntra.com and many others have proved to be quite useful for franchise industry. Franchisors as well as franchisees regularly register their offers on these websites. Uppal shared, “We have franchisors who register with us and we push the brand through various marketing channels. We also collaborate with high fashion organisations such as Vogue India, Femina, etc where we both advertise each other’s brand and it makes for an excellent alliance.”

Benefits to franchise brands

The question that comes to everyone’s mind now is: How franchise brands are benefitting from deals if they are offering lot of discounts?

Marketing push: The foremost factor for any franchise brand to register on e-commerce websites is promotion of the brand, whether it is been done by the franchisee or by the franchisor. It increases their brand value as well.

Increase in footfalls: Popular brands offering products/ services at lower rates are enough to attract any customer to their outlet. Customers from faraway places can also venture to buy or take the services. Manish Bajaj, Founder, Tress Lounge informs: “Our aim for offering services on snapdeal.com or any other e-retail site is that it leads to brand’s popularity and high footfall. Clients have become more internet savvy and spend a lot of time online. Offers on e-retail websites are popular and thereby increases our popularity as well.”

Increase in loyal customers: The increase in footfalls certainly leads to augmentation in the number of loyal customers. Clients/ customers venturing once can be impressed by the product/service offered by the outlet. In their next visit they would not mind paying the full amount just for the same service.

Clearance of old stock: Selling via e-retail sites can easily clear the old stock of the franchisor/franchisee. He can make profits on the products that were not sold from his outlet. As informed by Uppal, “Big brands associate with us to liquidate old stock or slow moving products get a push because of viral marketing and other marketing tools that Fashion and You makes use of.”

Reaching out to tier II and III customers: Customers from small cities and towns which do not have big showrooms can order branded stuff from such sites. This increases the sales of any franchisor or franchisee.

Franchisees benefit from e-retail sites: Concept of online selling is especially useful in boosting the business of new and emerging franchisees. A new franchised outlet needs a lot of advertising initially for making people aware of its opening. This can be provided aptly by registering themselves on e-retail websites. Shahnaz Husain, Founder and Chairperson, Shahnaz Husain Group says, “The Shahnaz Husain parlours, seen on e-commerce websites like snapdeal.com are franchise salons and they do their own promotions and deals to further their own business.” VLCC also encourages franchisees to do local marketing by registering in e-commerce sites.

A look at the future

With an ever growing economy the scope for e-commerce is increasing. Moreover with internet making everything easily accessible, the e-commerce websites are sure to grow by leaps and bounds. Rahul Sethi, Head E-commerce, ibibo.com shares: “We believe that the size of the e-commerce market will grow to USD One Billion by 2015  influenced by factors like increased internet penetration, internet access on mobile devices and huge investments in the sector leading to players advertising in mass media which would impact responsiveness for online shopping from the end customers.”

Ramakrishnan shares: “E-commerce will definitely lead the retail revolution in the coming years. This is also complemented by the fact that most of the large offline retailers are also looking at online. We have tied up with big retail brands like Future Group and Reliance, along with other fashion and lifestyle brands such as Nike, Puma, Adidas, Reebok, Lee, Wrangler, Jealous 21 and many more.”

To conclude it can be said that e-commerce is a growing concept that is also helping in the franchise domain as well. Franchisors as well as franchisees are both benefitted from the concept, which promises to engulf more and more brands under it fold in the coming years.

Related: Franchising in Fashion - The Growth Journey

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