India is one of the fastest-growing economies and is expected to surpass Germany and Japan to become the third-largest economy by 2025. India represents a $1 trillion retail market and has quickly become the Mecca for Western retailers setting up base to stake claim. With the government relaxing FDI norms, it became easier for MNCs to grab a major share. The Gap Inc, Aéropostale Inc, Desigual, Levi Strauss, Rider, Ipanema and Adidas AG, are some of the companies who have aggressively forayed into Indian territory.

Growth triggers for retail

Around 86 per cent of Indian respondents in a recent study said they were likely to make online transactions with their phones. This is good news for retailers both local and foreign as India’s consumers place a priority on fashion and apparel when it comes to online spending. Many of India’s consumers are technologically savvy, and mobile has become the leading Internet-enabled device for both urban (73 per cent) and rural (87 per cent) users in India. With a steadily growing middle class, and the vast majority of their population below the age of 35 (65 per cent), India is sitting on a mountain of unrealised growth potential for the mobile market.

Growing western influence

According to CLSA, India’s fashion market is a $17 billion industry and is growing 25 per cent year over year. There is a growing trend among India’s population in embracing Western culture and style. Indo-Western wear, a fashion trend that fuses influences from both cultures, is on the rise among pre-teens. And in a recent survey of workforce populations in top cities in India, 64 per cent said they prefer to wear jeans or denim every day. Levi Strauss, one of the original denim brands in the US was the first to explore India as an emerging market and now boasts 185 retail points country-wide. Brands like Aéropostale, Lee and Wrangler have taken measures to regain their share of market by entering India. Zara opened its first flagship in New Delhi in 2010, followed by Mango and H&M.

Due diligence is needed

However, before a company decides to stake a claim of your own in India, one needs to consider the following aspects: Conduct research to better understand how India’s regulatory environment works; familiarise with Make in India; the secret to securing customer loyalty will be in conquering the language barrier, etc.