The premium and ultra-premium innerwear market in India has been witnessing increasing influx of international brands. With major international brands paving the way to consume a chunk of the premium and ultra premium segment, this ever-growing segment is going through many changes. While consumers have cared more for outerwear brands and less innerwear brands, this is gradually changing. For the men’s segments, higher priced premium brands shall be the key drivers in the near future. With several international brands in the fray, it seems that the leader so far, Jockey might see some tough competition.
Premium segment on the rise It’s apparently estimated that the premium segment is valued at INR 6000 crore to 7000 crore of the approximately INR 30,000 crore of the overall hosiery segment. This was in 2017; this year, this the mid-premium and premium market is set to consist of about 40 per cent, which is said to be about INR 9500 crore. By the year 2020, these two segments are expected to grow to about INR 20,000 crore, which is growing at around 17-18 per cent CAGR. In this the men’s segment makes up about 14 per cent and Jockey itself holds about 55 percent of the premium segment.
Brands such as Puma, Benetton, Park Avenue, Jack & Jones, Fruit of the Loom, FCUK, Levis, Van Heusen, Calvin Klein, Woodlands are some that have penetrated this premium men’s innerwear segment and are notching up impressive sales figures month after month. Puma’s 300 mono branded stores across India stocks men’s innerwear. They have a sizable presence in MBO’s with 200 doors at present and this number is expected to increase to a whopping 1000 in the next season. The percentage would be 50-50 percent across MBOs and EBOs. The men’s premium segment is at 10 per cent of the overall men’s segment. Puma Innerwear is positioned in the premium segment with a sport-lifestyle product language, which is at the core of PUMA’s brand philosophy. Innovative materials, performance credulity, fun colours form the basis of the product line.
Puma has just started the innerwear segment in India last year and their focus is currently on product quality and comfort rather than acquiring market share, which will happen as they expand this category in the near future. At the moment, they are closely gauging consumer response to their products to understand what works best in this market and will look at picking up momentum leading to aggressive expansion in 2019. Abhishek Ganguly, Managing Director, Puma says, “The premium men’s innerwear segment presents huge business potential for us. The supply chain and regular replenishment model is key here and in fact akin to the FMCG model. Our focus will be on this category and we will look at making this a big business contributor going forward. We believe that there will be consolidation as this segment currently lacks a second big player. Whichever brand manages to get the correct distribution mechanism in tandem with product, will come up as a strong number two player.”
Lux too has a wide network in the country. According to a spokesperson from Lux ONN innerwear, “With the retail reach of 14,000 outlets across the country, ONN is emerging as one of the fastest growing brand in the premium wear segment. Launched in the year 2010, ONN premium wear has very soon garnered substantial amount of market share in the premium innerwear market.
Park Avenue, Raymond, contributes largely to the total business of men’s innerwear as well. Mr Srikanth Ram, Head, Innerwear and Accessories, Raymond Ltd., explains, “Our main business comes through MBOs, which contributes around 80 per cent of total business. Our EBO’s contribute around 15 per cent and other channels contribute to the rest 5 per cent of the business.”
As for the share of the men’s premium segment vis a vis the overall men’s segment, he says, “The premium price range is between INR 250 to INR 600 and its market size is 15 percent (INR 1900 crore in the year 2018) of the total men’s market size of innerwear (12700 crore in the year 2018).”
Jack & Jones is another fashion brand that has made a mark in menswear fashion in the country. This edgy, rebellious and an iconic youth-oriented fashion brand entered the Indian market with the aim to revolutionise menswear fashion in the country. Today, Jack & Jones is one of Europe’s leading producers of menswear with more than 1,000 stores in 38 countries with menswear clothing being sold by thousands. As of today, the brand operates out of 67 exclusive brand outlets, 388 shops in shops and availability across all leading online portals. The brand also has a dedicated website for online shopping.
Benetton India, another premium brand, is aiming to grow by 100 per cent in the innerwear segment, Undercolors, which is the strong focus area this year. Says a
spokesperson from Undercolors, Benetton India Pvt. Ltd., “We provide value for money and our presence can be felt with five categories across 300 exclusive UCB outlets, 47 distributors, 800 multi brand outlets and 65 large format stores. Distribution channel contributes to 70 per cent of the innerwear business, 20 per cent from exclusive UCB outlets and remaining 10 per cent from large format doors.”
Awareness and demand
Speaking about the growing men’s innerwear segment, a spokesperson from Jack & Jones said, “With the rising digital penetration, increased disposable income and exposure to international trends and lifestyle, Indians are willing to spend more on innerwear than ever before. Owing to the influx of global brands in the market, premium men’s innerwear is one of the highest growing segments in this category. Innerwear has evolved from a traditionally utilitarian item to an essential fashion must have.” The different sub-categories of men’s innerwear include vests, briefs, boxers, basic T-shirts, shorts, pyjamas and sleepwear. Consumers today purchase branded products for vests and brief or boxers, and the label has vast offerings in this range.
The spokesperson at Undercolors, Benetton India Pvt. Ltd., opines, “Premium segment grown in the innerwear industry, brand awareness has increased in the customers. Premium segment is contributing close to 20 per cent. Innerwear industry off late has witnessed the entrance of international brands in the premium and ultra-premium segment. The men’s The innerwear market is going through an exciting phase, as men are also ready to experiment with their innerwear and open with trying some exciting and bold styling as well. The men’s innerwear segment in value is being dominated by the premium segment and the innerwear segment is contributing close to 48 per cent of the total innerwear business.”
Mr Srikanth Ram too feels that the consumer is evolving rapidly and innerwear has graduated from functional to fashionable. “The industry is moving from price sensitive to brand sensitive. The premium segment is showing enormous promise to cater to these changing needs. Premium segment in India is going to grow at around 21 per cent CAGR in the next three years,” he states.
The spokesperson at Jack & Jones also feels that the demand for innerwear with higher functionality and greater comfort is rising fast. “With the increase in demand in the premium segment, the industry is moving from being price sensitive to brand sensitive. Hence, in order to always stay ahead of the game, brands need to constantly focus on innovation and product variation while remaining relevant to their target audience.”
He also mentions that seeing the exponential potential this category possesses, there is an incessant rise of brands in the market as well and so, brands, apart from creating innovative products need to also keep themselves away from reaching a saturation point within the category. “Each brand in the market has a different appeal and positioning. While some are high on fashion, others focus on comfort. It is now necessary for brands to find a balance between fashion, functionality and comfort,” he adds.
According to a spokesperson from Lux ONN innerwear, “Premium products/brands are any day better than mass products/brands. They are designed to convey an impression of exclusiveness, which makes it more desirable among the consumers. Hence, the demand and the market hold of premium products are always stronger in the market.”
A deluge of change in the premium segment
While overall the men’s innerwear segment is undoubtedly growing and so are the premium and super-premium segments; however, the premium segment has seen some major changes as well. Yet each brand has its unique share here too. The spokesperson at Undercolors, Benetton India Pvt. Ltd. states, “In the premium segment we are the only brand (Benetton) with the starting price point of 289, our competitors are much below when it comes to entry price point.
While Mr Srikanth Ram says, “Park Avenue is our major brand, which plays into two major segments. Medium segment (Pricing 125-250) and premium Segment (250-600). Medium segment is around 25 per cent of the total men’s innerwear market size. Medium and premium put together is INR 3170 crore of the total business.”
Also, the deluge of brands trying to cater to the rising demand in this segment has increased considerably with each trying to be a major player. Some brands have grown considerably and maybe there’s a shakeout or roll over of some brands in their growth story. “Apart from growth, I personally feel there is huge gap in the product category, which we will disclose once we come up with them,” says the spokesperson from Undercolors, Benetton India Pvt. Ltd.
Whereas Mr Srikanth Ram feels, “The lifestyle space in India is highly saturated due to competition from national as well as international brands. So, brands are looking forward to new avenues to add another 100 crore to their top line. Innerwear provides them with one such avenue to its growth potential.
Thus, every year, we see more brands are entering into this space. Going forward, we will see more and more national as well as international brands will be coming up with their innerwear lines.”
As for the level of saturation brands may hit in this segment, The spokesperson at Undercolors, Benetton India Pvt. Ltd. states, “It’s a competitive and aggressive market and I personally feel innovation is the key to maintain its position in the market and all brands are coming up with something or the other.”
While Mr Srikanth Ram thinks, “As the premium segment is growing at 21 per cent YOY, the brands are not near any saturation right now. But due to high growth potential, more and more brands are going to enter to this segment so competition is going to be tougher and tougher.”
As for Lux, the spokesperson says, “ONN is the premium Men Innerwear and casual wear apparel brand from the house of Lux, which is strongly positioned in the 20-30 year customer segment. The brand proudly boasts great quality and international styling with their wide product range comprising of innerwear, loungewear and outerwear. Keeping pace with the latest fashion and trend, ONN enjoys high youth appeal and is set to emerge as the most favourite brand of the new generation.”
When it comes to growth, brands in the segment have their strategies in place. “We are looking at growing from metros to mini-metros. We are also looking at expanding our presence in Tier II and Tier III cities as they offer untapped potential with an audience that is eager to consume,” comments a spokesperson from Jack & Jones.
Mr Srikanth Ram says, “The super premium market size is very small, so we are still not playing in that area. Our focused area is Medium and Premium where we hold around two per cent of market share on MRP. Also we are adding new categories in loungewear such as boxers and thermals. We, at Park Avenue, are making products that complement the needs of a man for every occasion.”
“As I highlighted earlier as well the customer has become very conscious when it comes to brand and the premium segment is highly dominating the men’s innerwear segment. Premium men’s segment is growing by multiple folds. Off late, many fashion / apparel players have extended their existing brand labels in menswear to men’s innerwear as well. Our primary focus is the door expansion this year and to open five exclusive Undercolors EBOs by year end,” mentions the spokesperson at Undercolors, Benetton India Pvt. Ltd.
“With the changing scenario we have witnessed here the changes in consumer’s preferences. Today, consumers are fast realising the power of Indian brands, their presence in the market, the quality of their products, and so we believe they are willing to pay for premium products even from domestic brands,’ explains the spokesperson of Lux ONN.
In the coming year, ONN will be trying to bring forth new styles among their casual wear ranges by introducing stylish products. “Being a pioneer in the industry, we understand the significance of marketing in today’s era and the consequences it shows. Hence, to attract the attention of consumers and to expand our presence in the market, ONN will aggressively invest on both print as well as electronic media to promote its new ranges,” he adds.
So, we can see that the men’s innerwear segment in the premium category is only increasing and brands are vying for space in this much in-demand category. Also, the domination of Jockey, which has been a frontrunner so far in this segment, does stand as it is.
However, the rise of other brands entering this segment and their international associations may have an impact on Jockey’s monopoly as people too have become more brand-conscious and willing to experiment as well.
Now, it remains to be seen if these players are able to overcome the domination of this brand and slice a big piece of the pie. Look for the concluding part of this story.