Founded in 2011, Jabong has emerged as one of the seasoned players in the Indian eCommerce avenue. A brainchild of Arun Chandra Mohan, Praveen Sinha and Lakshmi Potluri, the company deals in fashion and lifestyle.
Given the fact that the online fashion curator could be considered as one of the torchbearers of the ‘startup culture’ revolution in India, iamWire got in touch with Co- Founder and MD, Jabong, Praveen Sinha to get a better insight into the digital commerce space and seek his views on the general craze for raising funds observed amongst startups, Jabong’s merger with GFG and more in this sector.
Praveen opines that “the industry highlights the appetite of investors and sentiments of what they think will work”, but what he also feels is that “there are many startups which don’t need funding. Praveen adds, “Raising fund to build a business is secondary, first is to build a viable business model”. Clearly, Praveen is extremely product focused, an attribute that contributed in enabling Jabong to conquer the online fashion market in India.
Praveen believes, “most people are interested in raising funds and then they decide how to utilize it.” However, he is quick to add, “this is my personal opinion about small startups and is not relevant to bigger eCommerce players like Jabong.” Further he notes, “For us, I would say we should of course raise funds when it is required but we are well capitalized at the moment. Also, now there is a structural change as Jabong has become a part of the Global Fashion Group (GFG). Hence, a lot of fund-raising happens at the global level and not at the Jabong level. In the future as well, there won’t be any news from Jabong but you will hear of it from GFG”. The statement clearly confirms the fact that being a part of GFG is Jabong’s first step to go global. But at the same time, it is also suggestive of who actually has the upper hand in running the company now.
Last year, Berlin-based startup incubator, Rocket Internet merged 5 fashion brands across the globe into one entity at a combined valuation of $3.5 billion, thereby forming the Global Fashion Group. The brands include, Dafiti(Latin America), Lamoda (Russia and CIS), Namshi (Middle East), Zalora(South East Asia and Australia) and Jabong (India).
Speaking of GFG, Sinha asserted, “GFG was able to form because each of the countries were developed independently, but now they are forging relationships to build a global fashion company. It works reverse, as it was set up and then converged.”
“At a very macro level you will see a general merchandiser of a global scale but you will not see a fashion merchandiser of a global scale. This is the first attempt to make a global fashion company at a very high level.”
Elaborating on GFG, the Co-founder of Jabong states, “We managed to get River Island, Dorothy Perkins and many such international brands to our country. Now GFG gives us a strong opportunity of existing relationships. Hence, the chances of convergence increases. It gives a good commercial and a branding angle to us which has proved to be very advantageous.”
“In terms of fashion assortment, developing your own label requires a strong design and back end supply chain team and GFG helps in this aspect by making supply chain more cost efficient, thereby increasing the commercial viability”, he adds.
As far as the picky question of talent retention is concerned, Praveen emphatically states, “Talent retention is another benefit that we get from GFG. Many of the young and promising talents who join us, have global exposure. GFG enables us to exchange and retain talent, where I can even send people from my team abroad for global exposure and then bring them back”.
Jabong has been known for flouting conventions and breaking boundaries when it comes to business strategies, be it the company’s partnership with Lakme Fashion Week or running its own property called Jabong Online Fashion Week or for that matter, the introduction of Juice Magazine – choosing print, an offline media strategy to optimize its digital presence. And post it’s merger with GFG, the pressure to carve out novelty and to bring innovation has doubled. Sinha believes, “the key is to focus on the future without letting the present go.”
One of the areas where Jabong has been innovating lately, is its mobile strategy. One of the initiatives specific to mobile which is currently a work in progress is the development of an image search bar where the users can upload a picture and search for the same/similar product.
“Mobile is very important as it’s the tool through which most of the transaction will happen in the future. Right now we receive 50% of our orders from mobile and 50% from our desktop but in the future it will become 70-30%. We believe that both mobile app and mobile site will be relevant, and desktop site is relevant till the time there are enough users coming through that medium. So, I will not kill one over the other.”
With GFG, Jabong has already leapt ahead of its counterparts. Even the mobile strategy employed by the company looks promising. However, given the digital revolution and with technology snowballing and advancing to higher avenues, the market is witnessing a surge of emerging startups with ingenious models. The phenomenon thus, intensifies the need for a company to innovate and evolve constantly. More often, it is observed that the struggle to sustain on the top is way more challenging than reaching there. Hence, it would be indeed interesting to wait and watch how Jabong weaves a sustainable strategy for its way forward.