New Delhi Homegrown retailer Metro Brands Ltd., which owns Metro, Walkway and Cobbler brands, and sells foreign labels such as Crocs, FitFlops and Skechers in India, plans to open 200 new stores in FY13. In an interview, Alisha Malik, Metro’s president for e-commerce and marketing, talks about the lessons learned from foreign brands, sustainable growth in online channels and plans to expand to 300 cities from the existing 170-180 cities. Edited excerpt:
How has been your experience with American brands like Crocs and Skechers in India?
Metro, Cobbler and Walkway are own brands so the entire gamut including product, store and marketing strategy is with us. For Crocs, we are their national retail partner and run most of their offline stores. That number is about 140, but we’re opening about four stores a week, so it varies. However, with FitFlops, the UK’s premium open footwear brand, we run exclusive outlets, offline and online (channels), and even distribution. Therefore, we can also supply FitFlops to a competitor. Globally, it is considered a women’s brand. The male stronghold in India is a bit strong as it has been favored by one or two South Indian actors.
For Skechers, we are not managing any operations, but we are their largest pan-India partner. So, it is a strategic relationship, but there is no contractual obligation. We’ve also got a unique Canadian brand called Bion. We have partnered with them to launch in around 25 of our multi-brand outlets to see brand acceptance and customer feedback before deciding to grow the partnership. There are others with whom we are in talks.
How do Metro brands benefit from these relationships?
We feel that due to our operational excellence, we can provide a great platform to brands as we have online and offline presence and pan India distribution. We can really help brands scale and grow. For us, there are many lessons to be learned from international teams in the way they communicate, promote products, the way they develop. It brings a different dimension to our team. In addition, it’s clearly a big lever for growth as we make sure that when we enter into these partnerships, it makes sense for us at a lower level. We don’t like to put all the eggs in one basket. We put the customer at the fore in all our decision making.
Which brands are seeing a revival in demand?
Demand is back in all categories – casual, ethnic; The athleisure market was already in trend and continues to grow; The formalities are back after people return to the office. We opened 20 stores in the first quarter and are on track to open around 200 stores this fiscal.
Where will you open your new stores?
It depends on the brand. So Metro and Cobbler have a lot of penetration in metros, but new malls are coming up in these cities and we are seeing good opportunities. We have mapped 300 cities for expansion. We are currently at around 170 to 180.
How do you map consumer preferences to different locations?
India is a diverse country. In a city like Mumbai itself, Colaba’s range will be different from Dadar, whose range may be slightly different from Linking Road as customers are different. So, while we can make changes to the limit, we have automated a lot of our replenishment systems and products. We do placements first and then, as that store sells out, there’s machine learning that recommends products that perform well in that area to add to that store.
It’s a bit of art and science. For example, in Punjab, you will see more colors than you will see in Chennai. You will find higher heels in Mumbai than in Hyderabad. When we moved to the Northeast, the sizes were completely different. That being said, with the rise of social media and access to western fashion, a lot of product ranges have become common across the country. But we will never lose the regional flavor as we know that when it is time for Durga Puja, you need platform heels for women and colorful chappals for men in Kolkata.
How many of your sales are online as shoppers return to the store?
We ended up at around 7.6% as offline actually closed in the first quarter. Looking at the December quarter, it was at 10-11%. Having said that, the pace of development has stalled. It’s not like I’m seeing a drop in my online growth rate. It’s just that offline is expanding and continues to grow.
Are Crocs or Fitflop imported or manufactured here?
The majority are imports. We have no role in manufacturing. I think discussions are on to make their products in India. As for our brands, about 95% of our production is in India. With a vendor base of over 200, we aim to be agile and flexible.
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