India’s Reliance Brands has taken a step closer to its vision of becoming an apparel and lifestyle powerhouse in the Asian country with a new license for accessories and footwear under the Steve Madden brand.
The license, with Steven Madden Ltd., brings the Madden collections to all major cities across India through monobrand and premium department stores.
Darshan Mehta, president and chief executive officer of Reliance Brands, said the firm aims “to [translate] the brand’s unique fashion sense into the mind-set of the Indian female consumer.”
Reliance has joint venture partnerships with Paul & Shark, Diesel and Ermenegildo Zegna, as well as distribution agreements with Timberland and Quiksilver.
“Our partners must be long-term. There are no buyout options, no put options. We are married for good,” Mehta said. Even distribution agreements have an initial term of at least 25 years.
Reliance Brands is part of Reliance Industries Ltd. and was founded in 2007 with a mandate to launch and build apparel, footwear and lifestyle businesses ranging from luxury to mainstream fashion in India.
Before joining Reliance in 2007, Mehta was president of India’s Arvind Brands and ceo of VF Arvind Brands, where he brought the Lee, Wrangler, Nautica, Kipling and JanSport brands to India. He’s also launched Tommy Hilfiger in India through a venture with the Murjani Group and Gant via a license with Gant Sweden.
Mehta said the Reliance business model incorporates a three-pronged approach. The first involves partnerships and long-term distribution agreements with international brands entering the Indian market.
The second and third prongs — still in the process of germination — are the ones that could put Reliance in position to create paradigm shifts in the Indian apparel and retail market.
The second prong is venture capital-private equity-focused. Investments include acquisitions. Reliance would take a minority position where the stake is between 30 and 49 percent and leverage its expertise in sourcing, marketing and real estate to build the business. Since the parent is funding the purchase as a strategic investor, Reliance can hold the investment indefinitely.
The third prong could come to fruition within the next 12 months when Reliance launches its own apparel brand. While Mehta declined to disclose specifics, information gleaned from his big-picture vision for the firm hints at what’s to come.
Mehta’s 22-year-old son, who attends school in the U.S., has influenced his vision of where consumer buying is heading. “He doesn’t use e-mail, but is on Facebook every day. The concept of teenager doesn’t exist anymore. Even eight-year-olds have their own Facebook page now.
“There were 500 million Indians born after 1980. The median age is younger, not older. For this generation, the PC is obsolete. There are three screens: the mobile phone, the tablet and the television. All three are for entertainment and communication. The phone is now one’s center of gravity. India added 260 million cell phone users in 2010. The population has more than 760 million who have a cell phone, of which 172 million are smartphone users,” Mehta noted.
Given that perspective, expect the brand that Reliance will launch to be a multigender-focused vertical operator targeting the younger consumer, and will likely involve mobile commerce as one of its multiple points of distribution.