NEW DELHI — In another fillip for online fashion retail in India, FashionandYou, one of the pioneers in the online fashion retail space, has raised $10 million in funding, the company said Monday.
The etailer, which got a boost from its early partnership with Lakme Fashion Week is known for its focus on designers and its flash sales model.
Aasheesh Mediratta, chief executive of FashionandYou.com, said that the additional investment would help “acquire more customers to bolster our flash sale dominance and build a more cohesive brand.”
Competition in the fashion retail segment has intensified over the last few months, especially with the acquisition of fashion portal Myntra by Flipkart last month. After the acquisition, Flipkart said that it would invest $100 million to further the growth of Myntra.
“Fundamentally, nothing has changed in the market,” Devangshu Dutta, an analyst and chief executive officer of Third Eyesight, observed. “E-commerce platforms still need a path-to-profit; their business models have so far been driven mainly by discounts and promotions in a race to the bottom that no one is winning. Customer acquisition costs have dropped in recent months, as competition has thinned, but remain high. What is most worrying is low customer retention and the lack of differentiation — these are the foremost challenges to be addressed.”
Snapdeal, Koovs, Jabong, and several other online apparel retailers are trying hard to keep up in the race for the Indian customer’s online wallet, and competition continues to intensify.