Myntra clocks over $80 million sales in July
Myntra aims to generate annual sales of $1 billion in the year ending March 2017
Online fashion store Myntra on Monday said it clocked over $80 million sales in July, helped by its ‘End Of Reason Sale’ during the month. The company aims to generate annual sales of $1 billion in the year ending March 2017.
Myntra, which is owned by Flipkart, also said it is on track to break even early next year, but did not specify an exact date. The ‘End Of Reason Sale’ is held in July and December every year.
Gross sales, in this case, are net of discounts but before accounting for product returns.
Myntra chief executive officer Ananth Narayanan said the fashion store attracted 600,000 new users during the ‘End Of Reason Sale’ in July, of whom 80% have shopped on Myntra again, indicating customer stickiness.
Myntra said after the event, it now clocks more than 10 million monthly active users, up from less than 5 million a year ago.
Ananth Narayanan said the sales of full-price products, which do not involve any discount, have increased significantly since January and overall discounts have dropped by 10 percentage points.
“We are unit economics positive. We are excited by the growth trajectory because growth is coming in a sustainable manner. We want to be at the forefront of fashion revolution,” said Narayanan. “We are looking to turn profitable early next financial year.”
Myntra said it will open “physical experience” stores in the next three months for its private brands Roadster, HRX and All About You.
The firm, which launched categories such as home interiors, personal care and jewellery earlier this year to evolve into a lifestyle destination, will spend the rest of the year in improving selection and services, which is likely to help it achieve a net promoter score of 60 by the end of the year from 47 currently.
Net promoter score indicates the loyalty of a firm’s customers and the overall quality of its service. It is calculated by asking customers about the likelihood of them recommending the company to a friend.
Interestingly, Myntra’s parent Flipkart is also focusing on increasing its net promoter score and improving customer experience, which took a hit in the last 12-18 months as Flipkart rallied its resources behind increasing gross sales instead.
Last month, Myntra acquired Rocket Internet-backed Jabong for $70 million, a move which will make the combined entity of Flipkart fashion, Myntra and Jabong together command close to 60-70% of the online fashion market.
Narayanan said Jabong will be kept as an independent brand.
“Having two brands makes sense because there are more customers to reach out to. We are stronger on different geographies and customer demography. For instance, Jabong has a deeper penetration in north India and among women. There will be synergies around supply chain and logistics,” he said.
For Flipkart-Myntra, the acquisition of Jabong will boost sales at a time when Flipkart is struggling to revive growth and protect its leadership in a market where Amazon has made rapid strides.
Jabong offers more than 1,500 global high-street brands, sports labels, Indian ethnic and designer labels and over 150,000 styles from more than 1,000 sellers.
About 430 fashion and lifestyle start-ups have been founded since 2015, according to data provided by Tracxn, a start-up tracker, which together have raised about $481 million.
Myntra’s acquisition of Jabong also puts pressure on other online fashion stores.
Start-ups such as Tiger Global Management-backed Limeroad, Sequoia Capital-backed Voonik or Koovs among others, which were perceived to be posing a challenge to Myntra and Jabong until recently, may consequently face the heat as they will have to acquire new customers and stay firm on their niche offerings against an extensive collection from Flipkart, Myntra and Jabong, Mint reported on 28 July.