Swedish multinational clothing retailer Hennes & Mauritz AB (H&M) has tied up with Flipkart-owned Myntra and Jabong to sell its merchandise online in India.
“We are extremely delighted to partner with H&M, one of the world's leading fashion brands, and host them on Myntra and Jabong. As India’s leading fashion destination for international brands, this partnership will allow millions of online shoppers across the country to access and experience the best of H&M and have it delivered at their doorsteps," said Amar Nagaram, Head – Myntra and Jabong, according to an H&M blog.
After China, the Stockholm-headquartered retailer is piggybacking on e-commerce giants to reach scale rather than relying on its own online shop in India.
In 2015, H&M made its debut in India with its first store in New Delhi and earmarked Rs 700 crore to open 50 stores. It currently operates 41 outlets in the metros and tier 1 markets as well as smaller cities such as Raipur, Indore, and Coimbatore. In FY 2018 (the company follows December to November financial year), India accounted for 0.6% of the retailer's global net sales — 1.4 billion Swedish Kronor (Rs 1,108.2 crore) of the total 210.4 billion Swedish Kronor (in global revenue) came from the country.
During 2018, the Swedish retailer expanded its presence to online in India through H&M’s online store and app. Globally, online sales now account for 14.5% of the total sales for the retailer with 47 online markets and 4,900 brick-and-mortar stores across continents.
“India is a growth market with large potential and we look forward to making our brand available to new customers across the country. Myntra and Jabong will be an important complement to H&M’s existing physical and digital stores in India,” stated Karl-Johan Persson, CEO H&M group in the blog.
India boasts of a retail industry worth USD 750 billion growing at 10-12% year on year, according to research firm Technopak. Of the total retail market, online channel contributes about 3%.
H&M,in its blog, said fashion brands Myntra and Jabong are “pioneer in m-commerce play”, and they "bring together technology and fashion to create the best experience in the fashion and lifestyle space in India." Together they have partnered over 2000 leading fashion and lifestyle brands in the country including Nike, Adidas, Puma, Levis, Wrangler, Arrow and Jealous 21 among others.
Myntra and Jabong claim to have combined 15 million customers, according to media reports.
Of the recorded 566 million internet users in 2018, 97% access net from mobile phones, a recent Kantar IMRB ICUBE report said. However, only 19% of internet users in India end up buying products online — the country had around 113 million online shoppers in 2018, as per the data collated by Forrester, and the number is projected to grow to 175-180 million by 2022.
The deal will give Myntra and Jabong exclusive rights to sell H&M products online in India for five-six years, a report by Economic Times said citing sources. It is worth noting that India’s new e-commerce policy bars foreign e-commerce players to get into exclusive contracts with sellers (however, sellers can voluntarily agree to make the deal exclusive from their side).
“The latest tie-up with H&M has been structured differently to comply with recent regulations that don't allow marketplaces to enter exclusive deals with brands,” the Economic Times’ report said.