Recreating the magic

As more brands flock to online marketplaces, the challenge will be to recreate the differentiated experience offered in physical stores. Here's how brands can move towards that goal

Competitive clutter at the point of purchase is intense today, thanks to brand proliferation, extensions, private labels, me-too products and copy-cats. Given that, brand salience - the extent to which a brand stands out from its competitors - is vital in competing on the shelf, and more so in the online marketplaces where the entire experience is orchestrated by the host website.

In other words, it's a goal not easy to achieve in practice.

But then you can't ignore digital retail. At Rs 18,000-20,000 crore, it represents about 10 per cent of the organised retail market, and is estimated to grow to over 15 per cent of the organised retail market in five years. Easy to why companies are flocking to online marketplaces with their product listings. While companies like Xiaomi, Motorola and American Swan are selling exclusively online, after testing waters across online marketplaces traditional retail players such as Nike, Puma, Raymond, Big Bazaar, Hidesign and Nokia among others are developing customised solutions to present their brands in near-perfect shape in the virtual world. So how can corporates stand out in online marketplaces without cannibalising their offline sales or brand equity? Most importantly, how does a brand recreate its imagery and experience on online platforms where they can't deploy the tropes available in physical stores?

Keep it uniform and simple

Vijay Basrur, head, ecommerce, Raymond, says, "The identity of a brand needs to be retained while selling on a portal, any portal. They (shopping portals) can't play with brand's identity." Indeed, no brand would knowingly want to confuse patrons by presenting themselves in different avatars in the online and in the offline markets. Unfortunately, they end up doing so because of the way most product listings are done in online marketplaces.

Broadly speaking, product listing of a particular brand on an e-commerce portal can be divided in three categories: the first set of listings are made directly by a company, next comes listings made by the authorised resellers followed by the ones made by sundry stockists and unauthorised resellers (who may have permission to sell in a particular territory and can register online to sell across India). For obvious reasons the last set of listings are found short on appropriate content and presentation. Such listings could sully the image of a brand and can end up being a bone of contention between the brand and the online marketplace. But they are not uncommon.

Just some months back, Raymond discovered that some unauthorised resellers were listing its products on various marketplaces. On its part, German sportswear company Puma is gearing up to crack the whip on unauthorised resellers. Many other companies are restructuring their reseller contracts to include guidelines to sell online.

Argues Ankur Bisen, senior vice-president, retail and consumer products, Technopak. "Many leading brands in mature e-commerce markets across North America and Europe have tried to put checks on unauthorised resellers in vain. That said, incremental sales are in the interest of both, the brand as well as the marketplace, and so the two should collaborate to create a place for unauthorised resellers in the existing set-up."

Amit Maheshwari, vice-president, fashion, Snapdeal, contends that even a reseller can be made accountable through stringent quality checks. "One of the biggest things brands want is to position themselves like they are offline. It is important for us to showcase them in the same way. To enable salience, we create joint business plans with brands. Snapdeal's account managers and brand managers work together to plan activations and co-marketing for clients," he explains.

Throw in an online SIS
To avoid confusing online shoppers with a disconnected picture of a brand, fashion portal Myntra collaborates with brand owners to devise mirror images of their physical stores. This is achieved by creating an online shop-in-shop (SIS) which is similar to any SIS in a multi-brand store such as a Shoppers Stop or a Westside. For instance, the façade of the Nike Shop on Myntra has a scrolling banner ad which keeps moving to show the company's comprehensive range of footwear available on the website. Similar to the brick-and-mortar architecture of a Nike store, its online SIS on Myntra is organised into categories such as 'running', 'fitness', and 'basketball' and so on.

Myntra shares its website's wireframes so clients can assess how their online shop-in-shops will shape up. Says Myntra's chief operating officer Ganesh Subramanian, "While we provide content templates to clients, we respect the fact that they must have full control over content and brand imagery."

To keep a tight handle on shopper experience online, leather goods manufacturer Hidesign has built SISes across major shopping portals like Myntra, Jabong, Amazon and Flipkart and encourages them to follow strict selling guidelines. The company allows e-tailers to offer discount coupons on products priced below Rs 3,000 and actively discourages them from selling its high-end products at a discount. Currently, a team of eight professionals including relationship managers, graphic designers, and conceptualisers keep a track of Hidesign's presence across various ecommerce platforms. Dilip Kapur, president, Hidesign, says it is crucial for the company to keep a hawk-eye on the brand's performance across e-commerce platforms. In its evolution Hidesign has reached a juncture where it needs to enhance its "experiential" side to the consumers, he says. "Since everything today is discussed in the virtual world we would like to keep our brand intact in its true imagery and value proposition," he adds.

But why should e-tailers take the trouble? Simply because it is worth their while. E-commerce portals either charge an upfront payment to set up online SISes or negotiate a time-based fee. If a fashion portal makes 30 per cent margin on an ordinary apparel listing, it can make 5 per cent more on an online SIS.

Easy to see why in recent months most shopping portals have added shop-in-shops to their repertoire. While Myntra and Jabong have 50 and 30 SISes respectively, Amazon has over 15.

Snapdeal claims that the main objective behind launching the SISes is to give full freedom to brands to showcase the right merchandise, and to create the best look and feel, content and imagery. With its soon-to-be-launched brand store version 2.0, the marketplace plans to give more ownership of its SISes to clients by providing them customised tools to manage their stores. Interestingly, SISes have given shopping portals a big sales boost because companies don't skimp on technology or other tropes to draw customers. After creating an online SIS for a footwear brand, Myntra saw a 50 per cent jump in its average order ticket size.

Define your online strategy
Even if you are a brand that jumped to the online bandwagon in a jiffy, it is still not too late to define your ecommerce strategy. To begin with brands must understand that online marketplaces are not meant for them if they see it as a channel to get rid of distress inventory. Puma India's managing director Abhishek Ganguly has a word of caution against this approach. He says, "When a company decides to sell everything everywhere it triggers an undesirable price differentiation. Not to mention, this could have long-term brand ramifications."

Puma has a global team responsible for designing its content and brand imagery for online portals. Its product strategy is aligned with the distribution strategy, which means different products are pushed through different channels. To put together its online marketplace calendar, Puma's marketing team conducts meetings with e-tailers six months in advance.

Kumar Rajagopalan, chief executive officer, Retailer Association of India (RAI), says consumers are suspicious of products/brands that appear inconsistent in their dealings with consumers. For instance, if a particular brand or product of a company is available on deep discount in a virtual marketplace and is sold at full price offline, consumers are bound to feel cheated. So brands must be clear in their thinking and follow-through. "What most brands are doing today is sell the latest and exclusive offerings on their website and exclusive physical store to ensure there is no cannibalisation in sales as a result of their presence in marketplaces."

Such segregation becomes easier to pull off if brands keep track of consumer-generated data and look out for tell-tale insights. But this is a dark area even now. While all major portals know what's selling on a minute-by-minute basis, not enough data on what they call "meaningful actionable insights" is generated or shared. Rues Kunal Mehta, vice-president and marketing head, Mandhana Industries, the exclusive licensee of Being Human, "Since we work on a buy-hold-sell inventory model with all ecommerce portals, we do not have access to sufficient consumer insights to enhance the online experience of Being Human." As a way out, Mandhana Industries, is planning to launch its own ecommerce platform. Praveen Sinha, managing director, Jabong, says sharing relevant consumer insights can help e-commerce companies monetise their SISes far better than it is done today.