Niches in the Indian market

India has seen an explosion in availability of branded offerings over the past few years. Every experience, whether a force of habit or something novel, has now been branded. With a rising disposable income, we seek familiarity and the promise of living a better life, and buy things that have some associations with them.

But with growth opportunities in their respective categories now petering out, brands must look for new niches to address. Below is the first set of recommendations in a series I will challenge to complete this month, on the Blue Ocean Strategy brands can undertake. These are niches that are yet to be fulfilled, and I would attempt to examine gaps and the reasons for them. Some statements below would appear as sweeping generalisations, so you can make your own judgements about them.

The first category I've chosen is Apparel. It continues to be one of the largest categories for consumption, and can be actually termed a basic need for most consumers.

Branded but Affordable Jeans: The denims market has grown over the years, with Jeans becoming the defacto uniform of the youth. Most brands in the market want to be Levis clones, with little differentiating them. If you feel that statement is too generic, try recalling the last three Denim commercials you saw.

Within the category, most brands retail between the INR 1500-3000 range now, with a range of styles available in their stores in high street shops. 

The Niche: A branded pair of Jeans that sells between INR 700-1200 and has the distribution muscle to find space in smaller clothing stores across India. Most brands selling jeans today prefer to open their own stores, but we've seen how that debacle is ending- brands across the apparel spectrum are being forced to look at their debt structures, and redesigning their strategy. 

Tier II and Tier III cities in India are in the throes of a consumption boom, and the youth wants brands they can embrace. So even though Denim is a somewhat modern, western phenomenon, brand managers have mostly portrayed jeans in the 'Zombies dressed well hang out in open top cars' kind of commercials. The brand manager for the category I'm suggesting can look at an Indian milieu to the add, perhaps use humour as one of the approaches to connect to the audience.

The total denim market in India is about INR 2000 crores (Link). This market is largely unorganized, and served by manufacturers based in little factory ghettos in Delhi and Mumbai. Bigger brands are already producing their jeans in Bangladesh and Sri Lanka for the excise and other benefits their governments offer. The affordable jeans market thus is ripe for competition.

The best brand which can extend its product offering to this niche: Fastrack

Caveat: Levis is trying to enter this category, but is not sure about how it can find its footing. Signature by Levis was recently rebranded to Denizen- a brand that has no stand alone associations. The price points are right, but distribution is still an iffy.

Lingerie: Again, a category with a bevy of international brands, and some pitter patter from the Indian brands that have been here for some time. The niche I'm talking about has price points just above affordable, so the customer can aspire for spending extra to get their fix of wearing some thing branded. There is already strong differentiation available- For example, no brand, International or Indian, has tried to communicate enough about the need for a right fitting bra. There's a brand called Grover's that has been talking about this for long, but they have somehow managed to limit their audience to school going girls.

This category would have to be distributed in a different manner. Instead of the 'let's tie up with distributors of other branded consumer goods/build our own distribution' model, the brand would have to go to the wholesale markets for these products, and give decent margins to distributors so they can push the brand. God knows this is category aching for brands, and it just needs someone who can push on a Pan India scale.

Even though one would find products available at all price points in this category, upselling mostly happens due to how it 'looks' and 'feels'. With a variety of design lines, a brand could minimise product designs, and control inventory- selling a few classic and designer lines, with new designs coming in every season to liven up the brand.

P.S.: This specific category also requires a retailer in the online space.

Your take on this?


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