CAVEAT EMPTOR : THE FUTURE OF VIRTUAL RETAILING

November 17, 2016 written by
Mr Nischal Puri

 

 

This article marks the fourth chapter of his long exclusive, informative series: ‘What woman want’. This 6 article series will capture the insights of the Indian lingerie market and consumer trends besides noting the dynamics witnessed in this category – as a result of nation wide research by Horizon consulting India. Here as a part of giving our readers a new flavour regarding the realities of the Indian Lingerie market, we have started a column direct from the expert’s pen. With an experience of more than 20 years up his sleeves, Nischal Puri a veteran in the apparel and retail industry today,  has begun his own consultancy firm, Horizon India. After seeing many notable lingerie brands to their glorious present, Puri has now decided to add another feather to his cap and an intent to spread his extensive knowledge and understanding with the industry, he has taken up to penning down the same for us. He is a successful entrepreneur and an established thought leader and consultant. He can be reached at npuri@horizonconsultingindia.com

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Caveat emptor is Latin to  ‘Buyers Beware’,  the saying is old and have been the guiding principle of management thought process for decades, Caveat emptor have been cautioning the consumers to be aware of the sellers, to be safeguarded from fraudulent practices and from unethical and false promises and propositions.

 

In the greed dominated race of maximization of value, of extracting the maximum of every penny spent, consumers have relegated caveat emptor in the back ground. Its high time that the caveat is reanalyzed and reexecuted in all the dealings especially in light of the virtual retail that seems to promise the world to the consumers, selling the ease of shopping from the comfort of home, though the most popular place of shopping now is office, with workers spending good time on the shopping websites and even receiving deliveries in office, how has this led to deviation from the focus is a story for some other time.

So why I think that the consumer memory has to be refreshed on the caveat emptor, many reasons let me begin with the basic reason.

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Nomenclature: the nomenclature of online vs. offline, e-commerce vs. brick and mortar all these have a minute sense of superiority, self imposed on the shopping done by using the internet. As if buying online is like  the main frame buying while buying offline is passé, it almost appears to be positioned this way. The reason for this judgmental nomenclature is because the new entrant has defined the market and has safely relegated an antique tag to the current shopping method. A more non judgmental nomenclature would be real retail and virtual retail. Well indeed buying from the shop a physical entity is indeed real retail and buying from a store that exist in the internet is virtual retail.

De pattern: Over the last many quarters the conventional season of sale or end of season clearance sale calendar has been destroyed, the morning newspaper as a surprise announces in the front page up to 60% sale by one virtual retailer and the reasons are being now created and some have accepted that the sale is without any reason called as end of reason sale, the consumers buying pattern has become de patterned, the consumers are being given no reason to buy and perhaps buy more for no real reason, the caveat emptor needs to be exercised, how is it that a virtual retailer offering crazy prices, or is it a hook for initial period so that the consumer start trusting the virtual portal and eventually when the prices are increased they retain the consumer, well not sure but surely a point to delve on by  the consumer.

End of Brand:  In one of the high advertised lingerie portal that seems to have taken self imposed responsibility of teaching women how to buy lingerie and how real retail is not the right way and only virtual retail is the way to go has become DE BRANDED. The portal launched by using all the lingerie brands and compelled them to offer discounts and now they only sell their own labels sourcing done from China or local manufacturers. The de branded sale is the only way the virtual retailer can hope to make some profits, and in the journey of making its business profitable the virtual retailer has made good use of the branded players in their life cycle.

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The consumers need to exercise substantial caution, when non branded products are sold from real retail stores, they were looked down upon and now the virtual retailers are selling unbranded products but with suaveness and confidence that consumer will regard their brand stronger and would not care if they sell unbranded products. The sale of non branded products in the virtual retail is expected to grow exponentially, that is the only way forward, the consumers have to exercise extreme caution and prudence to make their buying decision.

Fake discounts. Consumers are so naive that they forget the true value of the products and despite years of cautioning they still get swayed by the word discount. more the better, all type of businesses have exploited this inherent weakness of the consumer and virtual retail is no different. Are the discounts genuine, the prices being offered are they the real value or the inflated price and then discounted, its been a norm in virtual retail where in even brands have exercised dual pricing one for real retail and one for virtual retail.

Lingerie sold from some of the virtual retailers are classical example, bra is being offered right from Rs. 99 to 1099, the look is not a differentiator. Perhaps fabric is perhaps fit is, but its the virtual world so how does consumer make out? the tendency is to fall for the least pricing. In a survey done by Horizon consulting India data compiled from 1500 online lingerie shoppers, 85% have communicated that whenever they have bought nonbranded merchandise they have felt cheated for the price they have paid.

Virtual retailers are bleeding and are expected to bleed further while they are still struggling to perfect their basic business model, consumers have to be cautious and exercise discipline in their buying decisions in assessing the true value of the merchandise they buy.

While the authorities are still unclear on what norms to bring in to put some sense in the virtual retail business, the only saviour for the consumers wallet is the consumer herself.

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