Institute of Management

Technology

Atul Gupta
Section G
Roll Number: 140103040
Ft14atulgupta@imt.ac.in
Contact: 7053143313

CREYATE: CHANGING THE FACE OF BRICK & MORTAR

RETAIL IN INDIA

Arvind Internet Limited (AIL) a subsidiary of Arvind Mills Limited, a startup

aimed at revolutionizing the e-commerce industry with its custom clothing
brand Creyate. This is being done under the leadership of Mr. Kulin Lalbhai,
executive director of Arvind Limited. This is Arvinds first foray into the ecommerce space. Having brought global fashion to the Indian stage, Arvind is
now aiming to bring a world class brand experience online. E-commerce is seen
as the cornerstone for the future of the group, it is expected to contribute more
than 1000 crore over the next three years. The key differentiator for Creyate
in this crowded retail space is the customization it provides for each customer.
Arvind is known for its fine quality and best in class garments, there has
already been a lot of hype around the new Creyate stores.

An online start-up by Arvind group, Arvind Internet Limited (AIL) is venturing into ecommerce by launching Creyate, ready-wear and traditional custom clothing brand that
intends to be 100 crore plus brand by the next year.
Kulin Lalbhai, Executive Director at Arvind Ltd said, We are all set to be a leading
consumer lifestyle player in the digital space by engaging in several business models that can
scale globally. Arvind sees e-commerce as a key growth driver for the group and we aim to be
1,000 cr plus business in the next three years.
Indian Textile Industry
India is the worlds second largest producer of textiles and garments, with a massive and
diverse raw material base. In India, textile & clothing industry contributes nearly 4% of
Indias GDP, 12% of total industrial production and 11% of total exports of goods. Textile
Industry provides direct employment to 35 million and indirect employment to 45 million,
which makes it the 2nd largest employment provider in the country after Agriculture.
Globally, India has the 2nd largest textile manufacturing capacity, in terms of spindles and
looms. India is the 4th largest exporter of textiles & clothing products to the world, with a
share of 4.4% in the global trade. Over last 10 years, exports of textiles & clothing products
from India have grown at more than 11% p.a., which increased the share in global trade from
3% to 4.4% between 2003 and 2012.
The Indian textile industry is set for strong growth, buoyed by both strong domestic
consumption as well as export demand. The total Indian textile industry size, including
readymade garments, was estimated to be `4.7 lakh Crores (nearly USD 87 Bn) in 2012, of
which apparel had a share of 69% of the overall market and textiles contributed the remaining
31%. The sector is projected to grow over the next 10 years at a CAGR of 9-10%, to reach `
10 lakh Crores (nearly USD 200 billion) by 2020.

The exports of textile and clothing products, accounts for about 35% of the total textiles
sector in India. Exports will continue to play a pivotal role in driving future growth of this
sector. Global trade in textiles and clothing is expected to see a strong growth, from current
US$ 750 Bn in 2012 to reach nearly US$ 1,150 by 2020. This will create an incremental
global demand of US$ 400 Bn primarily driven by the increasing global consumption;
continued shift of production base from developed to developing economies and also value
growth from inflation.

India is poised to be a strong contender to grab a share in the growing pie of global trade. The
cost competitiveness of India, as compared to some of the other exporting countries in Asia
(e.g. China) has improved over recent years. Availability of key inputs, i.e. abundant supply
of fibres, industrial workforce and young demographic are favouring India. These advantages
combined with entrepreneurial ability and capability to build infrastructure will be key
success factors for Indias rise in global trade.
Indian Apparel Retail Market
The Indian retail market, estimated at US$ ~500 billion in 2012, is expected to demonstrate a
robust growth rate of 13% p.a. over the coming years to become US$ ~1.3 trillion by 2020
(Source: IBEF Retail Sector Report). Apparel retail markets share out of this is ~8%, which
puts the market size at approx. US$ 40 billion in 2012.
The overall consumption growth story of India, driven by favourable demographic trends and
rising income level fuelling consumerism, is expected to continue to gain momentum. In
addition, favourable government policies to boost investor confidence are increasing
investments in organised retail. Currently, organised retails penetration in India is only 8%,
which is expected to increase to ~20% by 2020.

Indian Apparel market has demonstrated resilience and growth in an environment

characterized by slow economic growth. This trend is further strengthened by demographic
dividend of India, i.e. young consuming age group. By 2020, India will have 64% of the
population in working age group, making it the worlds youngest emerging economy. This
young consuming class has new aspirations and is more open to experimenting with fashion
brands and modern designs.
Purchase behaviour of consumers is also going through a significant change. Fashion today is
heavily influenced by global social media, international fashion icons, increasing disposable
income and rising confidence level. This is leading the shift from need-based purchasing to
aspiration-based purchasing, and fast adoption of international fashion statements.
Further, favourable policy environment (e.g. the decision to allow Foreign Direct Investment
(FDI) in multi-brand retail), has boosted investor confidence and opened doors for many
international retailers to enter India. The apparel retail industry is expected to benefit from
better product designs, while improving business performance learning from global bestpractices. The policy also requires investment in back-end infrastructure and substantial local
sourcing of products. Businesses with strong local expertise and vertical-integrated set-up in
textiles and apparel, like Arvind, are expected to benefit from this.
Rise of E-commerce retailing (also known as E-tailing) is another dominant force adding
momentum to apparel retail market growth. In 2013, estimated at US$ 1 billion it makes only
~0.2% of overall retail, but it is projected to grow rapidly to account for ~7% of the market
over next decade. Rapid percolation of technology enablers, i.e. increased adoption of smart
phones, tablets and laptops, and speedily increasing online consumer base are the drivers of
this growth.
3

About Arvind Ltd.

Arvind Ltd is part of Lalbhai Group, which has vast areas of business interests, including
chemicals, fabrics, adhesives and engineering products as well as apparel. The company has
many apparel-related subdivisions, including denim, woven fabrics, knitted fabrics, garment
exports, advanced materials, Arvind brands, Mega Mart retail and Arvind stores. It also has
engineering, telecoms and real estate divisions. The company manufactures and supplies
fabrics all over the world. Arvind Mills manufactures denim, shirts, khakis, knits and voiles,
amongst other fabrics. Arvind is the third largest producer of denim in the world. Its garment
division manufactures jeans, shirts and knitted apparel for many international leading brands,
including Esprit, FCUK, Gap, Marks & Spencer, Reebok, adidas and Tommy Hilfiger. Arvind
also has its own apparel brands, such as Excalibur, Flying Machine and Ruf N Tuf, which are
sold through its exclusive brand outlets (EBOs) as well as in other leading retail stores.
Moreover, the company manufactures and sells apparel brands including Gant, Sansa Belt,
USPA, Energie, Arrow and Cherokee under licence. The company also has joint venture
partnerships with brands including Tommy Hilfiger and Lee. VF Brands Pvt Ltd is a joint
venture with VF Corp to manufacture and distribute brands such as Wrangler and Nautica.
Arvind Ltd has a national presence through its various exclusive and multibrand outlets, as
well as through leading department stores and many independent apparel retailers. The
company is always trying to expand its presence further and its retailing venture Mega Mart
is an example in that direction. The chain has 205 stores in 60 cities and six big Mega Mart
stores in Bangalore, Chennai, Pune and Mumbai and provides a multibrand shopping
experience where apparel usually offers deals and discounted prices. Other than Mega Mart
stores, the company also has 273 stand-alone brand stores and distribution reaches 975
multibrand outlets. The company also has 40 Arvind stores, which specialise in offering
tailor-made dresses, fabrics and ready-made dresses.
Arvind Ltd has subsidiary companies which handle some of the brands. For example, Arvind
Ltd handles its own brands, such as Excalibur, Flying Machine and Ruf N Tuf. VF Brands
Pvt Ltd is a joint venture with VF Corp to manufacture and distribute brands such as
Wrangler and Nautica. Arvind Murjani Brands Pvt Ltd is a joint venture between Arvind Ltd
and Murjani which owns the rights to sell the Tommy Hilfiger brand. Van Heusen (PVH
Corp) has entered into a 50:50 joint venture with Arvind Murjani Brands Pvt Ltd and has
bought back the licence from Arvind Murjani Brands.
4

Retail Operations
The company increased its store numbers from 274 in 2012 to 315 in 2013. Furthermore, the
company has also strengthened its presence in multibrand outlets in India. The company has
its flagship Mega Mart outlets in all major cities of India. The frequency of discounts in the
companys Mega Mart outlets are throughout the year.
Table 1: Arvind Ltd: Retail Operational Indicators

Internet Strategy
The company is mainly focused on expanding its retail presence across India. The company
does not have an internet retailing website of its own. However, the increasing popularity of
internet retailing will result in the company starting its own internet retailing site in 2014 and
starting a new company by the name of Arvind Internet Retail Ltd.
Arvind Internet Limited (AIL) is the online arm of the Arvind Limited and is being led by
Kulin Lalbhai, Executive Director of Arvind Ltd. Kulin has significant experience in omni
channel space and retail domain. AIL will be a leading consumer lifestyle player in the digital
space by engaging in several business models that can scale globally.
Omni-Channel Retailing
Shoppers worldwide are no longer confined to a channel. For instance, a shopper could
research online via their desktop or hand-held device, verify review comments on social
networking sites, walk into a store to see the product, compare prices online, and conduct the
purchase transaction in the same store or online. Omni-channel retailing is all about providing
this anytime, anywhere shopping experience. North America is at the forefront of this
phenomenon. Even countries such as the UK, Australia, Singapore, and countries in Central
Europe are not far behind.
The multi-channel model grew with the addition of touch-points or channels such as ecommerce websites, mobile, social, call centre, and in-store kiosks. In the omni-channel
model, multiple customer touch-points are integrated seamlessly. Shoppers also have multiple
5

options to fulfil purchases; for example, buy online and pick up in store or deliver at home;
buy at store A, pick up at store B, return at store C, and so on.
An important aspect of omni-channel retailing is the supply chain. The retailer needs to invest
in capabilities such as inventory visibility across the network and order visibility across
channels to provide fulfilment options to shoppers in the most cost-effective manner. A single
view of data about customers, products, inventory and orders is another foundational
capability. Omni-channel also entails changes to core business processes and operations. The
store itself remains a significant touch-point. Store employees need to possess more
knowledge in serving shoppers who have access to a wealth of information about products.
They also need to be trained on new policies and procedures.
Omni-channel retailing is currently at a nascent stage in India, but the country is heading
slowly but steadily towards it. Leading brick-and-mortar retailers are foraying into omnichannel. Shoppers Stop, for instance, is making investments to be an omni-channel retailer.
Their e-commerce website was launched around a couple of years ago and provides a great
online experience. Future Group, the largest retail group in India, is also aiming to be an
omni-channel retailer. Ezones online platform, which was launched recently, led to a 5060
per cent increase in sales and is continuing to grow. Several online-only retailers such as
Flipkart, Jabong and Amazon have established themselves in the last few years and are
slowly making inroads. Other innovative channels are also slowly emerging; for example,
Delhi airport has a HomeShop18 virtual wall for QR code-based shopping.
Arvinds move into Omni-Channel retail: CREYATE
Creyate is Arvind Internet Limiteds first offering. A custom clothing website, Creyate aims
to provide an unprecedented experience with the help of an intuitive user-interface where
customers can personalise almost everything about their garment-fabrics, styles, components,
accents, monograms, and so much more. It also offers a curated set of collections for
customers to have as a starting point to their customisation journeys. The goal is to help men
and women dress according to their shape in custom-made garments that flatter and fit to
perfection. It is the ultimate confluence of Fashion, Technology, Manufacturing and you.
Creyate will cater to men primarily with shirts, suits, trousers; and shirts and denims for
women. The shirts will be available at price points ranging from 2,200 to 20,000, denims
from 2,100 to 8,000.
6

When a customer clicks on the website, www.creyate.com , he can select the fabric of his
choice, cut and style which is fitted onto an online mannequin. After a customer selects what
he/she wants, Style Stewards-the company's representatives, go to the customer's home, take
his/her measurements, also give style advice and complete wardrobe solutions. And once
measured, customers can 'Creyate' their own garments from anywhere and they will be
delivered as per their exact fit at their door step.
As of now, the Style Stewards are available only in Ahmedabad and Bangalore. The company
plans to soon have them in Delhi next, followed by Mumbai. It plans to be present in 15 cities
by the year-end.
A Creyate store is more like a design studio, with iMacs installed in the centre for designing
garments, and swatch books available for touch and feel of fabrics. The show stopper
garments that are on display, serve as concept validation in terms of final product. One can
walk over to the garment and scan the QR code and the same garment will appear on screen,
ready to be worked upon as per the individual's choice.
Set up at an initial investment of around 20 crore, Creyate intends to offer alternative to
ready-to-wear as well as traditional custom clothing. It targets to be a 100 crore plus brand
by next year.
The company plans to take Creyate to global consumers next year starting with the US
market, where online custom clothing is a large thriving market, followed by Europe.
Mass Customization
Creyate is an omni-channel brand which means it is both online and offline. It is a start-up
and is looking to change the way people shop for apparel. E-commerce is the next big thing
and they want to sell personalised clothing.
However, in the online space, everything is mass manufactured. So when one walks into a
Creyate showroom, one can choose from hundreds of clothing material and creates their
personalised suiting, shirting. The 3D visualisation software helps one to create their garment
by taking accurate measurements and deliver it in 12 days at their doorstep.
The products may be more expensive by 15-20 per cent. But it will be a personalised product
and not mass manufactured and marketed. One can create more than 100,000 variations on
the website. The designs will be created in the automated factory at Bengaluru. Creyate will
7

cater to men primarily with shirts, suits, trousers; and shirts and denims for women. The
shirts will be available at price points ranging from 2,200 to 20,000, denims from 2,100
to 8,000.
International Expansion
As per the data released by the Directorate General of Commercial Intelligence and Statistics,
Indias cumulative apparel exports grew by a robust 15.3 per cent during April-November
2014. The country shipped out apparels worth USD 10.8 billion during the period. In rupee
terms, exports grew by 16.6 per cent to 650.8 billion. China, the leading exporter of
apparels, faced a slowdown in its exports on account of a surge in manufacturing and labour
costs. Bangladesh, too, faced issues such as lack of adherence to safety compliances at work
place, wage hike and unrest among workers. The above factors are expected to have led some
prominent international buyers to divert their orders in favour of India.
Apart from these, domestic factors also aided India in establishing a relative advantage over
other apparel exporting nations. Unlike many of its competitors, India has a vast pool of
skilled and trained workforce. Other than this, the governments decision of an upward
revision of duty drawback rates on apparel exports is likely to boost Indias overseas
shipments in the coming years. Also, Prime Ministers ambitious Make in India campaign
is likely to generate an avid response amongst the readymade garment manufacturers.
As a consequence, Indias apparel export earnings are expected to grow by 14.8 per cent in
2014-15. Exports are likely to stand at USD 17.1 billion during the year. In 2015-16, the
countrys overseas apparel shipments are expected to increase by 11.5 per cent to USD 19.1
billion.
AIL, is expecting a turnover of 1,000 crore over the next three years as it seeks to grow its
offerings on the Internet, where increasingly a large population of shoppers in India have
been logging on to buy goods online.
Arvind Internet will also extend its omni-channel retail model into international markets such
as the US, UK, Japan and Germany. Arvind already has a presence in some of these markets
through its textile exports business. Arvind currently retails 30 brands in the country across
1,200 stores.
Competitive Landscape and Future Strategy
8

Most traditional retailers are moving towards omni-channel marketing. As consumers move
seamlessly between digital and physical channels, even during the same shopping trip, the
lines between online and in-store shopping is getting blurred, and reaching out to consumers
through all possible shopping points is becoming imperative.
Future Group plans to invest 100 crore over next 18 months to provide consumers a 'single
view' of its many brands across physical and digital channels. It is targeting 30 per cent
increase in business once its omni-channel platform becomes operational.
Infiniti Retail, which operates a national chain of multi-brand electronics stores under the
brand name Croma, has started delivering orders placed online the same day in 16 cities
where it has its stores. The number of daily clicks on Cromaretail.com stands at 2,10,000.
Trendin.com, the e-commerce website of Aditya Birla Nuvo-run Madura Fashion & Lifestyle,
has witnessed 200 per cent growth in its online orders since its launch in 2013 and is planning
to launch store pick-up and return services. Trendin.com showcases merchandise for men,
women and kids and houses brands such as Louis Philippe, Van Heusen, Allen Solly, Peter
England and People.
As the Indian e-commerce market evolves, customers will become more discerning and come
to the internet for things other than discounts and wide offerings. For the apparel category,
experiential e-commerce will become more relevant.

The case gives rise to two very important questions. As omni-channel retail is no more an
option but rather a must-do for retailers, how to get it right? How do retailers create an omni
channel environment inside their physical stores to ensure they capture the intent of the
consumer to buy and convert it?
As omni-channel retail is no more an option but rather a must-do for retailers, how to
get it right?
1. Ensure brand consistency
What most retailers and customers want is brand consistency. They are looking for
that ability to take their offerings and provide an experience to the customer that is
consistent across all touch points. They are also looking for a real-time system of
9

reference. So it won't help that an inventory lasts only for a few good months and then
hope the trend doesn't change - when, in fact, as a retailer they have to change
constantly.
2. Use open standards
One needs an open platform because you can't create everything new yourself using
your own technology team. The ideal approach is to have an environment with a
single stack of technologies that can serve all the different touch points. This enables
the marketing, product and sales teams to collaborate and present all of their offerings
to the customers, using any technology or device, all coming from a single source,
from the technology standpoint
3. Implement mobile commerce
Mobile commerce radically improves your ability to run a more agile and customerfocused business. With mobile commerce as part of the omni-channel solution, the
ability to deliver exceptional web-based experiences to a constantly connected
customer base generates streamlined purchase processes, more informed sales force,
improved service delivery and overall efficiency. Mobile commerce will also help
distributors and wholesalers minimise the cost of labour-intensive processes through
the use of self-service technologies
4. Know tomorrow's customer demand
A robust supply chain will give your business the following benefits: Higher customer
service levels by having products available in stock as customers need them; lower
expediting costs by reducing repositioning and expediting through improved shortterm forecasts, improved collaboration with demand planning across stakeholders through embedded analytics, scenario analysis, and collaboration tools. Lastly, an
enhanced production agility - by translating demand signals to short-term supply
requirements
5. Personalisation is key
Retailers need to embrace moving on to a platform that can seamlessly provide the
connection between manufacturers and customers for all of their products that they

10

want to offer, and to personalise it down to the level of an individual customer's

location.
How do retailers create an omni channel environment inside their physical stores to
ensure they capture the intent of the consumer to buy and convert it?
1. Conversion: Retail stores convert only 30% of the customers that walk into their
stores as most of them walk out because their size/ style/ color are not available.
Brands should provide their stores with tablets from which they can access stock
availability across stores
2. Click n Collect: If a customer orders online he can still pick up the product from the
store
3. Integrated Loyalty programmes: Customers get rewarded points irrespective
whether he buys online or offline. The customers can also be rewarded for sharing or
liking products
4. Store Staff Incentivization: Brands need to incentivise their store teams to convert
the intent of the potential customers irrespective of the channel of sale for the brand.
5. Data Capturing: Catch them when they are there! Its important to add customers to
your database and constantly engage them by capturing their details. The online
retailers are spending millions on this, in a brick n mortar this is still not seen as a
priority for many brands.
6. Relationship: The sales staff is the front office for any brand, relationship with the
brand are made and destroyed at the moments of interaction. A great store relation
will also ensure consumer stickiness of the brand.

11

References
Website:
Arvind Mills Limited. Financial Report retrieved from Arvind website:
http://www.arvind.com/investorrelations/annualfinancialreport.htm
India Retailing. (2014, April 28). Omni Channel: Surviving Strategy retrieved from website:
http://www.indiaretailing.com/7/23/26/10283/Omni-Channel--Survival-Strategy
Arvind Mills Limited. (2014, August 19). Press release launching CREYATE retrieved from
Arvind website: http://www.arvind.com/media/pdf/2014/PRArvindInternetCreyate.pdf
CMIE: Industry Outlook. (2015, Jan 23). Apparel Export data retrieved from CMIE website:
http://industryoutlook.cmie.com/
Euromonitor. (2014, October). Arvinds Strategy in Apparel Industry retrieved from
Euromonitor website: http://www.portal.euromonitor.com/
Newspaper Article:
Arvind to expand bespoke brand Creyate. (2014, Dec 19). Live Mint
Best of both worlds. (2014, Sep 22). Business Standard
Customised apparel: Textile giant Arvind forays into e-commerce with Creyate. (2014, Aug
20). First Post

12