Home / Companies / Start-ups /  App-only Myntra generates annualized sales of $500 million

Bengaluru: Online fashion retailer Myntra is generating annualized gross sales worth more than $500 million, up from roughly $400 million in May when the company shut its website and became an app-only platform.

The increase in sales represents a slowdown in growth for Myntra from the levels of the past two years, when it doubled or tripled sales.

Myntra, which is owned by Flipkart Ltd, is targeting gross sales of $1 billion in the next financial year. Gross sales excludes discounts and product returns.

The Bengaluru-based firm has also set a target of achieving operating profitability by March 2017. Myntra is increasing sales of higher-priced products and charging customers for deliveries for certain items to cut losses.

Since Myntra is privately held, the company doesn’t disclose revenue and loss numbers.

“Growth is not a problem. We grew 66% in October compared with last October, when we had the desktop, mobile web and the app," said Ananth Narayanan, who joined Myntra as chief executive officer in October.

Analysts have criticized Myntra’s app-only move, saying it’s anti-consumer and restrictive.

As a result of slowing sales growth at Myntra and because of a management exodus at rival fashion e-tailer, Jabong, online markets such as Flipkart, Amazon and Snapdeal have gained share in online fashion.

Myntra, on its part, maintains the customer experience is significantly better on apps than websites.

“We believe apps will be the way mobile transactions happen. Our repeat rate in terms of repeat purchases by consumers is the highest in the industry, north of 80%. This means that what we are doing on the app as far as the experience is concerned, consumers seem to be loving it. To do that, you need to be focused on consumers and that’s what our app-only strategy is allowing us to do," Narayanan said.

Myntra’s owner Flipkart said in November that it will introduce web-based apps that will potentially make it easier and more convenient for people to shop on mobile phone browsers. Myntra is also considering reopening its mobile website, Mint reported on 30 November.

“As technology evolves, perhaps we will do that (launch apps for mobile web). The Flipkart mobile web app provides a very different consumer experience (than what is traditionally available on mobile web)," Narayanan said.

Myntra will also launch a revamped version of its app to boost customer engagement. The updated app will have features such as a fashion feed (similar to that of Facebook Inc.), a forum for users to interact with each other and content on fashion brands.

Online fashion businesses are trying to create social networks for fashion enthusiasts, encouraging them to share tips on these websites as well as read articles and see videos. The move is aimed at hooking customers through content and social networking to try and gradually wean them off deep discounts.

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