MUMBAI: Reliance Retail is launching stores where women can buy apparel, footwear, cosmetics and jewellery and then take the pressure off at a salon or café, all under one roof.
Called Project Eve, the experiential stores will stack in-house and global brands and compete with the likes of Shoppers Stop and Lifestyle, two executives involved in the store launch told ET. The stores will be 5,000-10,000 sq ft in size and premium to its existing department chain, Reliance Trends, they said.
Email query sent to Reliance Retail remained unanswered till press time on Thursday. “The stores will mainly focus on urban markets such as Mumbai, Delhi and Bengaluru,” one of the executives cited earlier said.
The diversified group, with interests in telecom, media and petroleum, is already one of the country’s largest retailers and operates department chains Reliance Trends and Reliance Brands, which has partnered more than a dozen premium international brands including Diesel and Superdry.
The new store, however, will focus on premium wear and highfashion global brands to differentiate itself in the cluttered domestic apparel market which is driven mostly by discounts.
“They should do well with all under one roof, but it is challenging as H&M and Zara have taken a huge piece with their expansion, and by being international brands, they are ahead in fashion and style,” said Ruchi Sally, director at retail consultancy Elargir Solutions. “Reliance would have to really outshine with their USP as experiential retail format and not through cost or pricing.”
With increasing competition and shrinking margins for core products, several global retailers including Nike, Adidas and Under Armour are looking for new ways to stand out. Experiential retailing is one such innovation where they offer a cafe, yoga place or a gym inside the store.
Competition in the Indian apparel market, which is expected to touch $60 billion by 2020, is likely to intensify as more global brands join existing players such as Zara, H&M and Gap which have aggressive expansion plans to tap into the opportunities offered by India’s non-metro cities.
Just a year ago, Kishore Biyani-led Future Retail launched fast fashion brand Cover Story with an aim to take international fast fashion brands head on.
In 2016-17, the fashion and lifestyle segment contributed about Rs 5,000 crore, or 15%, to Reliance Retail’s overall revenue of Rs 33,765 crore.
However, the segment has shrunk from 20% a year ago after Reliance Retail shifted focus to electronics and grocery. But margins in the apparel business are significantly higher than other business verticals that Reliance operates.