Soch: Evolving from a regional retailer to a pan-India brand
Premium ethnic wear brand Soch was incepted in the year 2005 with a store at Forum Mall, Bengaluru. In nearly 15 years of its existence, the brand has grown from strength to strength and is now present in more than 200 consumer touchpoints across the country in over 50 cities. It is also available to consumers through its webstore Sochstore.com and via online fashion aggregators like Myntra, Flipkart, Amazon, PayTM Mall, GoFynd and Tata Cliq etc.
Among its many milestones, two that stand out include the commencement of its website in 2014 and the launch of its firststore outside the country, in Nepal, in 2019.
Over the years, the brand’s product range has also seen a continuous expansion – it was one of the fi rst brands to launch kurti suits as a category in 2015 and also took the lead in enriching the consumer experiencevia digital interventions like inventory linked large format content displays in stores and Omnichannel retailing.
In an exclusive interaction with IMAGES Retail, Vinay Chatlani, Co-Founder and Executive Director, Soch talks about the retail journey of the brand, the international growth and also reveals what’s next for his brand.
Excerpts from the interview:
What was the reason behind betting on a category that was largely dominated by unorganised players?
My father and I have a fair bit of experience in retail, even before we started Soch. The idea for Soch was born from the insight that the modern Indian woman has a need for curated, stylish and on-trend ethnic wear, and that there was a vacuum in the market in this category. Our bet was also that with increasing disposable incomes, and more and more women joining the work force,they would gravitate towards a shopping experience that not only guaranteed them the quality backed promise of a brand, but also reflected their own persona.
Throw some light on the product portfolio of the brand. What is the USP of the brand that helps it stand apart from the competitors?
Soch is an ethnic fashion brand for the modern Indian woman. With the evolution of the woman, her needs, desires and tastes, the Soch product line is also constantly evolving. As a brand, we give our consumers a range spread across occasion and casual ethnic wear, however, we believe that it is our occasion wear range that gives us a distinct space in the mind of the consumers. We believe that a well-priced offering in the premium occasion space is a genuine gap in the market, especially if the consumer wants to look special, and not like every other woman.
Our huge variety – supported by both width and depth of range, which we constantly churn to bring in freshness is what helps Soch stand apart from the competition. At Soch, the consumers can find delightful variety across categories like Kurtis, Sarees, Salwar Suits, Bottoms and Tunics.
Share with us the operational structure of the brand. What steps are you taking to be an Omnichannel brand?
At Soch, we are focused on expanding our reach in different ways so we can serve and delight every consumer who would like our offering. We operate more than 130 standalone exclusive brand outlets across 49 cities. Our website – sochstore.com, services consumers both in India and internationally. In addition, we are present on a host of online platforms like Myntra, Amazon, PayTM Mall, GoFynd and Tata Cliq etc. extending the brand’s reach.
We understand that the consumer journey, post the Internet, has become multi-faceted and there are multiple entry points for discovery, decision making and fulfilment across this new journey. Our social platforms enable consumers to discover our content and buy it across any channel they prefer at the time convenient to them. Like any other retail format, we also face the challenge of ensuring the right SKU is available to the right consumer on the right channel at the right time. We have launched our Omnichannel app as well, to ensure that we are able to off er consumers at our stores a selection of merchandise available across the chain and not only the store they walked into.
Our catalogues at the stores have redefined consumer convenience and ease of shopping. We are also looking to digitise the same to bring a similar experience to a larger set of consumers as our efforts to integrate and drive seamless experiences across the Soch website, our marketplace presence and the endless aisle app integrated with the stores gain strength.
We aim to make our Omnichannel push stronger in the future, with enhanced inventory coverage and better customer experience on the omni-application.
What changes did you bring about in your strategy to enable you to become a pan India brand?
The business model and the product proposition to the customer has been tailored in the early stages of Soch for South Indian markets. In most of the other markets, we have looked at tweaking of the assortment and the representation of each sub-category to make it more appealing to the consumers in these markets. In the West, we were able to build traction pretty quickly and the East has surprised us. We have made inroads recently in the North, where we have had hits and misses. Yet, the North looks promising once we get around the fact that seasons change to extremities and that the aesthetics can change given cultural influences. We haven’t changed the positioning of Soch or our major category representations to expand across India.
How did you generate enough funds to start branching out into different parts of India?
Soch has grown entirely from internal accruals and some judicious use of bank debt. One important contributor has also been our franchise partnerships with people who believed in us and invested capital into opening our stores, and in many cases also running the operations for us.
What will be the next level of growth?
Our prime objective is to maintain healthy store level growth in double digit and to make sure we improve on our efficiencies on the supply side. We propose to add 20- 25 stores in the coming 12 months as wellas further expand our SIS presence.
or smaller markets/ catchments, we are working on a smaller format – ~800 sq. ft. – which should start scaling soon. We also expect trade format to kick off in the next fi nancial year.
Given the huge potential of e-commerce in surpassing the boundaries of physical retail, we are also sharpening our focus on e-commerce, especially for international consumers.
It is often said that regional brands are more focused than their national counterparts. How do you keep true to your brand essence with the level of expansion that you have achieved?
Regional brands have more focus because they are closer to serving their markets,helping them increase penetration and dominance in their core markets. National counterparts can tend to have a middling approach to serving a pan India market but there are exceptions to the rule.
By enabling strong integration of the product assortment, service levels, retail identity and 360-degree marketing, we have been able to retain the essence of what we stand for. Our processes, policies or delivery design don’t change by markets.
Are customer-centricity and price consciousness still important in the race to become a pan India brand?
Price sensitivities can vary by markets but it’s impossible to generalise about any particular city. It is true that many categories like ethnic wear can be elastic to prices, but that doesn’t really mean that cheaper products of dubious quality and finish will drive customers to a brand. Everyone evaluates price against the quality and that’s the ratio we need to perfect. There is a discount driven customer who can be fulfilled through end of season sale and factory outlets.
bigger rival brands in the national market?
The market in India is very large. Soch is already among the largest brands in our category and we believe our proposition is being delivered better by us than anybody else. There is enough room in the market for all of us to grow.
It’s prudent to focus on leadership. By that we mean getting incrementally better with what we do and create perceptual distance with regard to product and brand superiority against other players versus chase market share through pricing alone. The best way to grow is not to ape competition but try to be a better version of ourselves year-on-year, by concentrating on delivering superior value to our consumers.
Share with us the marketing and promotional strategies of the brand.
Our marketing effort is directed at making Soch the preferred brand in the Indian wear space. Salience is built through campaigns across print and outdoor. Personalised campaigns are done through digital, email and Soch Circle loyalty programmes. Below-the-Line is done through catalogues, in-store retail signages and coupon-based offers.
Any technological advancements that you made in 2019? Any plans for introducing new technologies in 2020?
We believe in taking our store to where the consumer is. In an increasingly digital world, we have achieved that objective by complementing our retail stores with the Soch website – https://www.sochstore. com/ and our Omnichannel app to enable our consumers to buy what they want, when they want. The global website, serving our consumers internationally has been our new foray in 2019. We have also been pioneers in implementing display technology in our stores. It comprises video walls and tablets which displays content of stock currently in store. It also promotes offers live in stores, helps conversion at the point-of-sale by helping consumers appreciate product details better like fl ow, look, ensemble etc.
We will be focusing a lot on backend technologies in the year 2020, with technologies to support quicker replenishment and better allocation of available inventory across the chain and technology that integrates feedback from various sources so we can use those as areas of improvement. We have started to see results of our efforts on driving a higher data orientation. Data analytics and breaking silos on how the data gets viewed across the different stakeholders via tools like BI Retail has helped planning and replenishment get more aligned to the consumer requirements at the store front.
The heart of any retail business is the people running it, and this year, we also intend to use technology to arm our people do their jobs more effectively. We should be seeing the roll-out of a new training app, as well as an integrated ticketing system that loops in all stakeholders for speedy redressal. Our sales associates are being armed with digital tabs which we believe will give them the required tools to not only make sales more efficiently but empower them with information to solve for consumer queries, and convert potential friction points to moments of consumer delight.
On the customer facing front, our Omnichannel play will get a much higher push and should see a much higher contribution of business from the same. We are also betting big on footfall and consumer behaviour technology to give us further insights into the next areas of improvement for the business, along with implementation of a technology enabled feedback system that helps us be more responsive and systematically integrate consumer feedback cycles into the business.
What is your market presence and how are you planning to expand it?
Our existing retail network comprises of over 200 touchpoints across exclusive brand outlets, multi-brand outlets and large format stores. Online, we sell through www.sochstore.com and also from fashion dominant e-stores like Myntra, Jabong, Flipkart, Amazon, and Tata Cliq and PayTm.
We plan to essentially double this footprint in 3 years. We are fairly new entrants to MBO and LFS formats, so we see larger growth in terms of touchpoints here. The East and North Indian markets are very big, lucrative and exciting markets that we have just started to explore. We are looking to aggressively expand our foothold in these 2 markets while continuing to grow in the South and West.
What is the total retail area of the brand and how are you planning to expand it by the fiscal end?
Soch stores cover more than 2 lakh square feet of carpet area. Our stores vary from 1,200 sq. ft. to 2,700 sq. ft. and we plan to expand our store footprint by 20-30 percent next year.
Throw some light on the growth trajectory of the brand?
We aim to cross Rs 1,000 crore run rate in the next 4 years, with an average CAGR of 30-35 percent. We have had an SSPD of ~60 over the last 3 years on an average.
Please share your views on South India’s retail market?
South India has good modern retail options and the customer is not very different from the rest of India. Cities are gradually becoming more cosmopolitan and this has its own challenges for retail. There is availability of good quality real estate in the markets and Indian wear continues to be strong in these markets and advantageous to us as retailers.
Over the last 3 years, organised retail has seen 25-30 percent growth, while unorganised retail has grown between 10- 15 percent. Growth in the South is more from salaried class and there is speedier movement of the young into the middle class, because of which the markets will continue growing.
Share with us the opportunities or bottlenecks for your industry?
The retail market in the South faces a challenge of good locations that are engineered for the industry requirements. Another challenge, especially in up country markets is the access to quality franchisee partners who can help the brand scale quickly. We believe that we can double the store count in the South in the next couple of years, with the right set of circumstances and inputs.
Is the market attracting investment in your sector?
There is likely to be a lot of deal flow in the Indian wear sector. Just five years back, it was predicted that western wear will take over from ethnic wear for women, and surprisingly ethnic wear has become increasingly popular and even department store chains are investing heavily in growing this category. There are few players of a size above Rs 300 crore and we are among the very few of them that have not already had multiple rounds of investment. So, naturally this puts us at a totemic point for the category as we specialise in readymade clothing, sarees and ready-to-stitch. Investments in this sector are likely to be on the radar of funds because when it comes to women’s ethnic wear, there’s a dearth of scaled brands with a strong value proposition.