Myntra eyes Rs8,500 cr revenue for FY18, 45% rise in June end of season sale
Flipkart-owned online fashion retailer Myntra expects private-label brands to contribute over a fifth of sales during its 24-26 June sale, says CEO Ananth Narayanan
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Bengaluru: Flipkart-owned online fashion retailer Myntra is aiming to grow sales by at least 45% from last year during its upcoming season-end sale, driven mainly by exclusive tie-ups with brands such as Mango, Esprit and Forever 21, even as it looks to touch annual revenues of about Rs8,500 crore for the 2017-18 fiscal year.
Myntra, which will hold its biannual End of Reason Sale (EORS) from 24-26 June, also expects private label brands to contribute over a fifth of sales during the three-day event, said chief executive officer Ananth Narayanan in an interview on Monday. Myntra currently boasts of private label brands such as Roadster, HRX, Dressberry and Anouk.
The season-end sale comes at a time when Myntra is pushing to turn profitable and looking to move away from the traditional e-commerce discounting model. Earlier this year, Myntra launched a new sale event based on high fashion and minimal discounts, as part of a broader strategic shift towards selling full-price products.
“End of season is a very fashion-specific event—when we move from spring-summer to autumn-winter, every fashion group, including luxury brands such as Louis Vuitton, does an end-of-season sale. We’ll never get away from doing an end-of-season sale...We’ll continue doing the full-price events throughout the year—the end-of-season and full-price events are not at odds with each other. Both are fashion-specific events,” said Narayanan.
During its previous end-of-season sale event in January, Myntra generated sales of about Rs408 crore over three days, including sales from Jabong. The sale helped push Myntra’s monthly sales to over Rs850 crore in January—nearly twice the amount it generates during a normal, non-sale month.
For its upcoming end-of-season sale, Myntra is aiming to do even better than the January sale, although Narayanan declined to share details of the retailer’s internal targets for the sale.
“We’re expecting 25x of a normal sales day for Myntra, and about 13-15x for Jabong. We’re expecting 45% growth from July last year. Almost 1,800 brands are participating, and we expect about 15 million users to participate in the upcoming edition. We’ve never done anything on this scale before,” said Narayanan.
Myntra also remains on track to grow overall sales by at least 40-50% during 2017-18 and will look to touch revenues of about Rs8,500 crore, including sales from Jabong, said Narayanan.
For the upcoming sale event, Myntra is signing up third-party delivery partners, including local kirana stores to meet excess demand.
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“One key challenge is supply chain—this time almost 50,000 deliveries will be done on alternate delivery models. We’ve signed up nearly 800 kirana stores through Myntra Logistics. And these will help us during peak sales,” he said.
Myntra is also introducing a new concept called Myntra Shopping Groups, which allows buyers to shop in so-called online groups, as part of a move to drive higher traffic and retain more customers.
“People like shopping in groups— it’s an offline behaviour that happens. So, this time you can form groups of three to 20 people. You can shop anytime during the EORS and assuming you hit certain milestones, you get additional discounts for the next six months on Myntra, over and above all other discounts. We expect 100,000 groups to be formed during EORS,” said Narayanan.
Myntra, which acquired smaller rival Jabong earlier this year, is aiming to hit $2 billion in annual revenue run rate and also turn profitable during 2017-18. A $2 billion annual revenue run rate implies monthly revenues of roughly $165 million.