The disastrous impacts of the coronavirus pandemic on the fashion retail industry have been in talks for a while now. The stakeholders are acting actively to mitigate these impacts. Out of the various strategies proposed by the retailers, resorting to discounts remains the most critical one.
Many lifestyle and fashion brands are offering discounts ranging from 20%-50% to lure customers and subside the harmful side-effects of the lockdown. The nationwide imposed lockdown restricted the spring-summer collection from going on the floors, as a result of which the retailers are seeking to sell it on big rebates.
Brands like Vero Moda, Only, Woodland among others are adopting the “buy now ship later” policy on their websites to ensure fluidity of sales. On the other hand, third-party eCommerce sellers like Myntra, Ajio, Koovs, and Shein have also received a green signal to deliver in green and orange zones.
In a fast-moving world, fashion is moving at an equal pace, hence, bringing months old inventory to the table at the original prices would just add to the dead stock. Therefore, to avoid such risks, retailers are being compelled to offer discounts. They are optimistic that this strategy will help them reduce the burden and the losses they have incurred during the lockdown period.
Noting that fashion is one of the hardest-hit categories due to the lockdown, Ankur Bisen, senior vice president, retail and consumer at Technopak, a management consulting firm, said “The current inventory brand will not be relevant once market fully. Brands have to sell off inventory, and therefore they are incentivizing consumers (through discounts and offers) to buy products,” he explained.
“Despite the discounts, brands will not witness scores of bargain hunters glued to online shopping, said internet economy expert, Sreedhar Prasad. “The experts also predict that the people who were largely shielded from the financial impacts of the pandemic will be the first ones to step into the retail world once again. “I believe these shoppers are not discount-driven. They have stable jobs with regular income flowing in and steady savings, they don’t mind spending ₹2,000 or upwards,” Prasad added.
The famous personal care brand, Bath and Body Works, on the contrary, believes that the brand-loyal customers will continue to shop from their favorite brands with or without discounts. “There is a spike in sales online on our website because our loyal customers are currently not able to get their desired products through any other medium,” said Tushar Ved, President, Major Brands India, which retails Bath and Body Works.
Furthermore, Realizing the growing efficacy of online platforms during such times, Bestseller India is emphasizing its virtual reach with a belief that it is going to give them a boost. upon asking about discounting strategy, “We are offering discounts but they are not deep,” said Vineet Gautam, chief executive officer (CEO) and country head, Bestseller India.