BackSnapdeal acquires Exclusively.com
Move part of plan to strengthen Snapdeal's fashion business and touch $2 bn in gross merchandise value
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New Delhi: Online marketplace Snapdeal.com said on Wednesday that it had acquired Exclusively.com, an online retailer of premium and luxury fashion, for an undisclosed amount.
Snapdeal aims to strengthen its fashion business, looking to touch $2 billion in gross merchandise value (or cost of goods sold) in the fashion category this year.
Since the inception of Exclusively in 2010, founders Sunjay Guleria and Mohini Boparai Guleria have sold and bought the company twice over.
In November 2012, online fashion retailer Myntra bought Exclusively.in (a fashion flash sales site back then) together with its subsidiary SherSingh.com, an online retailer of private label sports apparel.
It was in June 2013 when Guleria and Boparai Guleria together with some angel investors bought back Exclusively from Myntra.
“Myntra wanted to exit the company as it was largely focusing on competing with Flipkart and Jabong back then. We saw long-term growth in the business and decided to buy it back," said Guleria.
Industry experts anticipate the acquisition by Snapdeal to be a step towards getting into the business of flash sales, when products are offered at steep discounts.
“Flash sale businesses are picking traction again. Most investor and companies are looking to invest in this category. I don’t think the deal has been done for the team or for customer base," said an analyst who did not wish to be identified.
Guleria denies he has plans to get into flash sales again. “We might do limited window exclusive collections but they will be not on discounts," he added.
The deal was closed earlier this month and the name of the company was changed from Exclusively.in to Exclusively.com; the company plans to launch international luxury brands and designers on the site this year.
Until now the site has largely been driven by Indian designer labels.
‘Exclusively’ is an interesting brand name, said Abhishek Goyal, founder of Tracxn, a start-up that sells data on privately held firms to investors. According to him the deal could have been triggered by “the opportunity in luxury fashion market and the brand name".
“The ticket size in this category is high and globally also the interest in this space is increasing. Distribution, too, is a pain point in the luxury category," Goyal adds.
Exclusively, which currently gets 50% of its business from outside India, expects to expand its India business to 80% of its overall sales this year.
“Our goal is to sell in India while keeping the global edge," explained Guleria. “We are looking to grow the overall business to $100 million in next twelve months."
According to Snapdeal, luxury products and services are a $14 billion market in India, growing at 30% year on year.
More than 70% of consumers want to shop for luxury products in India rather than abroad, the company said in a statement.
“We have witnessed a surge in demand from consumers across the country for premium and luxury products. However, given that access to luxury brands is severely limited in our country, we have brought Exclusively into our family to provide our 40 million plus users access to the widest range of aspirational, high-end products and services," said Kunal Bahl, co-founder and CEO, Snapdeal.com.
Exclusively.com, which will continue to function as an independent site, currently retails India’s leading designers on its site, including Manish Malhotra, Tarun Tahiliani, Manish Arora, Anita Dongre, Rohit Bal, Gaurav Gupta, J.J. Valaya, Ritu Kumar and Varun Bahl.
“With increased awareness and growing disposable incomes, premium and luxury consumption in India is seeing a significant upward trend," Guleria and Boparai Guleria said in a statement.
Earlier this week, Mint had reported that Snapdeal.com was eyeing up to five acquisitions in the technology space this year and was in advanced discussion with two-three companies.
Last year was an active one with respect to acquisitions for Delhi-based Snapdeal, which announced five purchases including that of Doozton, a social product discovery technology platform; gifting recommendation technology platform Wishpicker.com; group buying site Grabbon.com; online sports goods retailer eSportsBuy.com and online marketplace for handicrafts Shopo.in.
Snapdeal, which has raised in excess of $1 billion last year from investors including Japan’s SoftBank Group, posted a loss of ₹ 264.6 crore on revenue of ₹ 168.1 crore in 2013-2014.
The company claims to offer close to 10 million products across 500-plus categories on its platform with over 40 million registered users and 100,000 merchants. The company aims to expand its merchant base to one million in the next three years.
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