SEPTEMBER 5, 2016

MARKETING STRATEGY ANALYSIS

MARKETING PROJECT TERM I
6550 words

Aman Jain

16P066

Garvit Goenka

16P080

Neel Verma

16P093

Nidhi Goyal

16P094

Salil Shukla

16P106

Vishal Tyagi

16P119

Executive Summary
The purpose is of the project was to summarize the business model of the Company
FabIndia, which has its product line as ethnic wears, home dcor products etc. The
ethnic wear line of the company was chosen for analysis. The project helped us gain
in depth knowledge of how the marketing concepts can be used to analyze and judge
the growth as well as working prospects of a company and its product. This product
line was chosen as for this and other products, the company has a unique business
approach in terms of its shareholder model which focuses on inclusive capitalism by
setting up wholly owned subsidiary supply regional companies (SRC). This
unconventional approach has helped the company generate profit constantly.
Throughout the course of this project, a thorough analysis of the company was done.
The tools used for the analysis were:

SWOT analysis

PEST analysis

Porters 5 forces analysis

Through these tools, the study of the marketing strategy and its effectiveness was
done. Through these analysis, we tried to identify the reasons that have led to the
success and the threats that the company faces. After conducting the detailed
analysis, we came up with certain recommendations that the company can adopt so
as to boost the sales further.
A literature review was also done to understand the theoretical concepts related to
marketing research. After studying that a survey was done keeping in mind the
theoretical concepts to gather information about the consumer behavior of FabIndia.
We tried to gauge what motivates the customer to buy from FabIndia. The survey had
questions like percentage of ethnic clothes in the wardrobe, preferred place of buying,
important factors while making the buying decision etc. Through these questions we
tried to map the consumer behaviour and preferences. The data collected was then
represented graphically for better understanding.

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Further an interview with Mr. Venkatraman Narayanswami, Head Franchising at

Fabindia Overseas Pvt. Ltd., was done. We tried to gain first hand insights from him
about his company and how the company has formulated its marketing strategies
thorough the course of time. He has an experience of about 19 years so he was able
to give us a lot of valuable insights. He was asked questions like the differentiating
factor for FabIndia, Pull factor for the company, positioning strategy, sourcing
structure, expansion strategies etc. from these questions we got an understanding of
what strategies the company applies and how has it evolved over time and their future
outlook.
Finally to study the segmenting, targeting and positioning strategies, ALEXA.COM, a
website which surveys the traffic on any given website was referred to for collection of
data. The data collected was analyzed by our group to study the customer traffic on
fabindia.com. Through this source we were able to observe the real time traffic on the
site

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Contents

TOPIC
Purpose of the project
Objective
Significance and Justification
Project Outline
Introduction
Marketing Analysis
SWOT Analysis
PEST Analysis
Porters 5 Forces
Literature Review and Survey
Marketing Research Process
Methodology Adopted
Data Collection and Analysis
Interview with Mr. Venkat Franchising Head, Fabindia
Alexa.com Brand Positioning Analysis
Segmentation | Targeting | Positioning
Conclusion
References

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Purpose of the project

The purpose is to summarize the business model of a particular product. It will help us
gain in depth knowledge of how the marketing concepts can be used to analyse and
judge the growth as well as working prospects of a company and its product. It will let
us explore the various methodologies that can be used to research about the product.
At the end of the project, we aim at developing an insight how a product uses its
opportunities to its advantage and build on its USP and at the same time, learn to
handle its threats.

Objective

To study the in depth business model of a particular product/brand

To understand the basic marketing concepts and apply those concepts to

understand the working of the particular brand.

To understand the growth path and model adopted by the company.

To do an analysis of the consumer behavior by analyzing the market factor that

influence the buying decision

To study the factors that influence the success or decline of the product such
as opportunities realized or missed, threat, USP, etc.

To understand how a product makes its way to become a brand.

To do a concluding analysis and give suggestions based on our research and

understanding.

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Significance and Justification

Textile Industry in India is one of the most profitable sectors in terms of exports as
India holds a huge comparative advantage in the same along with very cheap labor
participation. Indian handloom sector plays a vital role with a contribution of up to
14% of the total industrial production index, earns 30% of countries total export
revenue and employs almost 65 lakhs people.

WHY FABINDIA?
It has a unique business approach in terms of its shareholder model which focuses
on inclusive capitalism by setting up wholly owned subsidiary - supply regional
companies (SRC). Also, despite having huge competition from brands such as
pantaloons, biba, global desi, etc FabIndia still stands strong. During 2014-15 the
ethnic wear firm posted a 12% rise in consolidated sales at Rs 1148cr with 36%
increase in profit before exceptional items at Rs 112cr.
In this cut throat competition in the garment retail which tries to keep itself afloat by
giving unbelievable discounts, FabIndia not just survives but steers through in full
throttle without any such offers. To know about this unique strategy and to get to
understand how it manages its brand without the least of marketing has what has
compelled us to take up this brand as our marketing project.

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Project outline

After deciding upon the company and the product to be chosen, we plan to
firstly look at the how was the need for the product created.

Looking at the history, we will track the business model as well as the evolution
of the same.

Studying the strengths, weaknesses and framework through SWOT and PEST
analysis.

Do an in depth analysis of how the supply chain mechanism work.

How the consumer base was developed and what were the factors that the
company used to its advantage.

Methodology used Use theoretical as well as practical tools to develop in

depth knowledge about the company and the product.

Finally, we aim at giving suggestions based on the research done using various
statistical and graphical analysis.

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Introduction
Founded in 1960 by John Bissell, Fabindia started out as a wholesale export house
and has since established itself as the biggest retail company in India. The companys
philosophy is to showcase Indias enormous wealth in handloom textile and rural
craft.With a pan India presence, Fabindia is the largest private platform for products
that derive from traditional crafts and knowledge. A large proportion of these are
sourced from villages across India where the company works closely with the artisans,
providing various inputs including design, quality control, access to finance and raw
materials.

Fabindia was founded with the strong belief that there was a need for a vehicle for
marketing the vast and diverse craft
1976

Fabindia opens its first store in

Greater Kailash, New Delhi.

traditions of India and thereby help fulfil

the need to provide and sustain rural

1980s

Fabindia has become a known

brand for garments made from
hand woven and hand printed
fabrics.

employment.
Fabindia sources its products from over
15000 craft persons and artisans

2000

The non-textile range is added.

across India. It helps artisan by

providing

2004

Organic foods, which formed a

natural extension of Fabindias
commitment
to
traditional
techniques and skills is added.

various

inputs

including

design, quality control, access to raw

materials and production coordination.
The major portion of Fabindias product

2006

Personal care products added.

2008

Handcrafted
introduced.

jewellery

was

range is textile based. The textile-based

product range includes ready-to-wear
garments and accessories for men,
women, teenagers and children; bed,

bath, table and kitchen linen; floor coverings, upholstery fabric and curtains. Cotton,
silk, wool, grass, linen and jute are the basic fibres used.The vision continues to be to
maximize the handmade element in our products, whether it is hand-woven textiles,
hand block printing, hand embroidery or handcrafting home products.
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Marketing Analysis
1. SWOT ANALYSIS
S

Regularised supply
chain
Poitive Image of the
brand

Low production
efficiency due to
lobour focussed
approach
Brand MDI not
leveraged to its
potential

Audience in awe
with this kind of
targeting - urban
heritage
Tremendous growth
potential

Huge competition
and competitors
always thinking to
evolve the basic idea
Retail sector hugely
dependent on real
estate prices

STRENGTH

Regularized supply chain: The company has setup Supply region companies
that are responsible for the complete supply chain in the region where they
operate

Elimination of middle men: the presence of supply region companies eliminate

the need of middlemen who are the ones that generally exploit the suppliers
and reduce the margins.

Fabindia stores are managed by the company itself and they dont issue
franchise to outside players. The rationale behind this is that they want to
position the brand in the market appropriately and dilution of their brand image
wont happen as everything is centrally controlled

Inclusion of artisans into the business by making them shareholders so loyalty

with the company is maintained. The supply region companies act as the
mechanism through which the suppliers can be added as the shareholders in

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the company

Employees are also shareholders of the company (in 2010 which was the 50 th
year of Fabindia, all employees were made shareholders of the company). This
improves employee satisfaction which in turn helps the company [1]

Positive image as the products are helping develop rural India. The local
craftsmen and artisans have been provided a regular source of income and this
has helped create a positive image about the company

Healthy balance sheet means raising of debt easy for Fabindia

Has acquired UK based ethnic wear retail chain EAST so expansion in UK

[2]

market possible. EAST has 77 stores through which the sale of fabindia
products is possible.

WEAKNESS

The complete manufacturing of products is manual so they cannot achieve

production efficiency and increasing supply volumes would also be difficult

Growth opportunity limited as they dont go for franchise in retail. As the

company tries to manage the stores centrally the rate of expansion is slow

The prices of the commodities sold is very high so if they want to increase their
sales the prices need to be controlled

Fabindia has not been able to capitalize on the brand image that it is having.
According to a survey, general public was asked about the estimated net worth
of the company. The company was valued in that survey to be 11 times its
actual worth. This proves that it is having a positive brand image in public but
they have not capitalized upto the potential.

OPPORTUNITIES

Young people have started appreciating the cultural authenticity in the products
they use and since India has more than 65% below the age of 35, so Fabindia
can target this a group.

Since the economy of India is growing, Fabindia can target tier-2 cities.

They can increase awareness by advertising and encouraging people to buy

handloom products.

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In a report by Dasra, India's share in $400 billion global market is just 2%. So,
there is a tremendous scope for growth in the sector.

THREATS

Many retailers, both domestic and global, have entered the market of ethnic
clothing and hence their price-cutting strategy can force Fabindia to follow suit
and hence can affect their bottom-line

It will be tough for Fabindia to decide between the interests of artisans and
private equity firms which have invested in it.

Khadi & Village Industries Commission (KVIC) is a government entity which can
reap the benefits of subsidies

Real Estate prices leading to slow retail outlet expansion

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2. PEST ANALYSIS
POLITICAL

As all Fabindia products are manufactured in India by the local artisans it

directly supports Make in India Initiative. It also exports its products to over
33 countries

Fabindia also manufactures organic food items and personal care products. Its
products meet organic certification standards set by National Program for
Organic Producers (NPOP) which follow the guidelines of International
Federation of Organic Agriculture (IFOAM).

Currently each state has its own sales tax policies and 5% VAT is levied on
sales of ready-made garments in India

Now GST will ease procurement of goods and raw material. It will help reduce
the transit inventory by providing a favorable environment for supply chain. This
will be helpful fabindia as it has its suppliers and stores all over India.

Recently govt. of India has removed restrictions under the Incremental Exports
Incentivisation Scheme. This will improve cash flow of the importers and
promote export of made-ups to Australia and New Zealand[3]

ECONOMIC

Indian handloom sector plays a vital role with a contribution of up to 14% of the
total industrial production index, earns 30% of countrys total exports revenue
and employs almost 65 lakh people engaged in weaving and allied activities.
Within this sector cotton weavers contribute to almost 90% of the total
production. [4]

The textile industry is the 2nd largest employment generation sector in India.
The handloom sector has a very special character in which control is spread
not just in the hands of a few but production is dispersed.

Fabindia has a 1000 employee and 86000 artisans under in SRCs and this all
comes under its Corporate Social Responsibility initiative.

This sector also focusses on equity participation and so is prescribed both by

the MSME Ministry and the Competition Commission of India.

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Though Fabindia started off as an export house from 1994 onwards it has
focused primarily on the National Retail outlets and so exchange rates
fluctuation do not play a major role as both production and retail is domestic.

SOCIAL

India has the worlds best demographic dividend and with the coming back of
ethnic fashion trends Fabindia has a target audience of all not just aged
people but the youth too. This point is further highlighted by the recent lifestyle
trends and the refocus on Indian sanskritization.

Fabindia as a brand has gained tremendous popularity without any focus on

marketing and advertisements. Brand development through word of mouth
happens only if the product quality is unmatchable and consistent.

The focus of the company has always been equitable growth and has been
rightly acclaimed as the perfect model for poverty alleviation.

Social benefits by accommodating artisans as shareholders not only enhances

employee retention but attaches a bond with company and its artisans.

It runs various CSR (expenditure for 2014 on CSR was Rs 1.51cr) schemes
with major focus areas on
o Promotion of education and vocational skills- Bali, Rajasthan
o Rural development project- Bali, Rajasthan
o Disaster Management- Srinagar, Kashmir [5]

TECHNOLOGICAL

Fabindia has a very innovative approach to maintain its supplier network. It has
introduced a concept of Supplier Region Companies or SCRs. this is based on
the idea of ownership within the company. The local artisans are part owners
of SCRs, through which they indirectly own a part of fabindia. There are
currently 16 SCRs which employ about 86,000 artisans in fabindias network [4]

Fabindia sells its products across various range through an online portal which
offers facility of home delivery and cash on delivery

Fabindia has also tied up which major e-commerce companies such as

amazon.com, flipkart.com and myntra.com for the sale of its products.

Company also protects the intellectual property right of the artisans by

implication of geographical indicators

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3. PORTERS FIVE FORCES ANALYSIS:

Fabindia

operates

as

sustainable luxury retail store

Threat of New
Entrants

which is a niche sector in itself

but it is heavily influenced by the
overall

Indian

industry.

Porters

wear

retail

five

forces

Supplier
Power

Internal
Competition

Buyer Power

analysis has been done and the

outcomes

have

been

listed

belowThreat of
Substitution

1. Threat of new entrant:

Barriers to entry are low due to

Low investment: This is not a capital intensive business and also the cycle time
for required for manufacturing of the product for setting up a business, so, the
threat from new entrants is high.

Labor:

The labor employed is generally the village craftsmen or local

handicrafts workers so they are cheap and readily available. Once a network of
craftsmen is setup, there is easy availability of labor

2. Buyer Power:
Buyer power is high due to

Availability of options: The buyers have many options available. They can
switch to western wear and even in the ethnic wear they have many other
options like Khadi Gram bhandar. BIBA etc.

Readily available Choices: Generally all companies sell their products through
multi brand retail stores but FabIndia sells through exclusive stores so the
buyers might prefer visiting multi brand stores.

3. Threat of Substitutes:
There is substantial threat from the substitutes as-

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Large number of substitutes available: buyers have option to choose non-ethnic

wear and there are immense options available. Even if they choose to buy
ethnic wear, many other substitutes are available

Cheaper substitutes available: The products from FabIndia are priced on the
higher side so the consumers have other cheaper options available.

4. Supplier Power:
In case of Fabindia the supplier power is low as

Strong network of producers: FabIndia has developed a big and a loyal

manufacturing base. They have brought business to the craftsmen for years so
they are loyal to the company and hence the company has advantage in this
respect.

Large demand of craftsmen: FabIndia is in need of expanding its operations

and is looking to rope in more suppliers. Also the suppliers are in high demand
by the other companies so they have an upper hand in bargaining

5. Competition:
Competition is high in retail industry but the niche area in which Fabindia operates
i.e. Indian wear manufactured by local weavers or the sustainable luxury retail
there are substantially less no. of competitors

Indian wear made by local weavers: there are a very few companies operating
in this domain. A few examples are khadi gram udyog and good earth.

Options in non-ethnic wear: There are numerous competitors present. If the

buyer is not fixated on buying ethnic cloths, too many options are available at
similar or lower costs. Companies already operating: Raymond, Peter England,
Zara, Forever 21.

Competition in ethnic wear: In the ethnic wear as well, the suppliers have many
options available. Companies like Biba, Meena Bazar, Nalli are already well
placed in the market.

So it can be seen from the Porters 5 forces analysis that the entry into the textile retail
industry is relatively easier. Also the options

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Literature Review
THE MARKETING RESEARCH PROCESS
To take advantage of all the resources and practices available, good marketers
adopt a formal marketing research process that follows the six steps shown in the
figure. We explain the steps below:

STEP 1: DEFINE THE PROBLEM

Formulating a problem is the first step in the research process. In many ways, research
starts with a problem that management is facing. A management problem must first
be translated into a research problem. Once you approach the problem from a
research angle, you can find a solution.
For example, sales are not growing is a management problem. Management
problems focus on an action. Do we advertise more? Do we change our advertising
message? Do we change an under-performing product configuration?
If so, how?

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Research problems, on the other hand, focus on providing the information you need
in order to solve the management problem.
Marketing managers must be careful not to define the problem too broadly or too
narrowly for the marketing researcher.
STEP 2: DEVELOP THE RESEARCH PLAN
To design a research plan, we need to make decisions about the data sources,
research approaches, research instruments, sampling plan, and contact methods.
Data Sources
The researcher can gather secondary data or primary data, or both. Secondary data
are data that were collected for another purpose and already exist somewhere.
Primary data are data freshly gathered for a specific purpose or project.
Research approaches
Marketers collect primary data in five main ways: through observation, focus groups,
surveys, behavioral data, and experiments.
Research instruments
Marketing researchers have a choice of three main research instruments in collecting
primary data: questionnaires, qualitative measures, and technological devices.
Sampling Plan
After choosing the research approach and instruments, the marketing researcher must
design a sampling plan. This calls for three decisions:

Sampling unit: Whom should we survey?

Sample size: How many people should we survey?

Sampling procedure: How should we chose the respondents?

Contact methods
Now the marketing researcher must decide how to contact the subjects by mail, by
telephone, in person, or online.

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STEP 3: COLLECT THE INFORMATION

This is generally the most expensive and error prone phase of marketing research.
Some respondents will be away from home, offline, or otherwise inaccessible; they
must be contacted again or replaced. Others will refuse to cooperate or will give biased
or dishonest answers.
STEP 4: ANALYZE THE INFORMATION
The next to last step in the process is to extract findings by tabulating the data and
developing summary measures. The researchers now compute the averages and
measures of dispersion for the major variables and apply some advance statistical
techniques and decision models in the hope of discovering additional findings. They
may test different hypotheses and theories, applying sensitivity analysis to test
assumptions and the strength of the conclusion.
STEP 5: PRESENT THE FINDINGS
The marketing research process culminates with the research report. This report will
include all of your information, including an accurate description of your research
process, the results, conclusions, and recommended courses of action. The report
should provide all the information the decision maker needs to understand the project.
It should also be written in language that is easy to understand. Its important to find a
balance between completeness and conciseness. You dont want to leave any
information out; however, you cant let the information get so technical that it
overwhelms the reading audience.
STEP 6: MAKE THE DECISION
The marketing managers in the final phase weigh the evidence mentioned in the
research report. If their confidence in the findings is low, they may decide against the
planned course of action. Some organizations use marketing decision support system
to help their marketing managers make better decisions.

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Methodology Adopted

The impact and focus

areas to be researched
have to identified and
appropriate consumer
behaviour pattern to be
recognised

A consumer behaviour
survey to be floated and
responses of different
demographics to be
recorded and later
analysed

The analysis to be
linked with the
changing trends and
new ideas and products
to be in sync with these
consumer behaviour
patterns

Step I : The impact and focus areas to be researched have to identified and
appropriate consumer behaviour pattern to be recognised

Step II : A consumer behaviour survey to be floated and responses of different

demographics to be recorded and later analysed

Step III : The analysis to be linked with the changing trends and new ideas
and products to be in sync with these consumer behaviour patterns

The questions put in the survey were focused on gauging what FabIndia must
be taking into account while deciding its product.

The survey captured the gender of the people who filled the survey so that an
idea can be derived how differently men and women behaved.

Another question was to determine the type of buyers FabIndia has acquired
with its various categorization in the apparel segment.

Yet another question was to determine the challenges FabIndia might have to
face for having a specialized outlet for selling its products as these days people
visit multi brand outlets considering their ease while shopping.

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ETHNIC WEAR SURVEY

Then there were questions to gain insights on what should be the area of focus
for FabIndia so that it sells its products despite having a price on the higher
side. From this an insight can be gained into whether the strategy adopted by
FabIndia of having high price but high quality product is correct.

Finally as FabIndia is involved in betterment activities for the rural suppliers, a

question was put to judge whether their involvement in such activities actually
influence the customers decision to buy their product.

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Data collection and Analysis

Data was collected using google forms. The survey form had 7 multiple choice
questions for analysis of behavior patterns of consumer of Fabindia products. A total
of 134 responses were recorded from men and women of age group 20-30.
The data collected was analyzed through excel and pie charts and bar charts were
made for responses of each question to visualize the data. On basis of the analysis of
data interpretations were made about consumer behavior.
The following has been derived from the data and further these have led to us to frame
certain inferences:

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ANALYSIS APPROACH FOLLOWED

With respect to the data we have acquired, we tried to come up with certain inferences
and how the product and services could be altered to meet the demands of the
customers in a much more effective way.

I.

The 1st inference was regarding the priorities customers have while choosing
their apparel and more importantly in the ethnic brand section. Almost 50% of
the people surveyed cited Quality as the most determining factor leading to
their purchases. This shows that though price remains a major targeting factor,
people nowadays have started placing quality on an equally high pedestal.

II.

Also the connect with native roots also plays a determining factor and thus this
tells us that there is a lot of scope and potential for indigenized handicrafts and
local artisans as the saskritization culture is slowly propping back again among
the youth.

III.

The 2nd major inference was regarding the fact how consumers have their
shopping planned out. We had two options :
a. Planned out shopping
b. Impulsive Shopping
Through the survey it was found out that most of the women have a planned
outing for buying ethnic clothes while men have both planned and impulsive
shopping habits. This can also be attributed to women being more particular
about their choices.

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Keeping this in mind, the men section need not be updated very frequently as
the core sells the maximum with defined colours and patterns, while the
women section needs updated designs to keep customers engaged and so
that their footfall frequency keeps pace with the changing demands.
IV.

The last inference was related to the social responsibility angle where we asked
people whether their buying preference or the priority brand changes if the
brand is taking up social responsibility and is concerned with the overall welfare
of the society. We were pleased to know that it does play a part and a good
percentage of people did count this as a major factor of why they placed
FabIndia as their 1st choice brand. Thus this soft power status of the brand has
also helped it grow and expand and it should continue to leverage this aspect
in the future also where it is both concerned about the growth of the company
and the overall social benefit or the welfare of the society.

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Interview with Venkatraman Narayanswami

Venkatraman Narayanswami (now referred as Mr. Venkat) is currently Head
Franchising at Fabindia Overseas Pvt. Ltd. He is a dynamic and result driven
professional with 19+ years of experience in Retail, Apparel Exports and Consumer
Durables. He has proven expertise in Retail Strategy, Business Planning, Brand
Expansion, Sales Leadership, Store Launch, Market Reach, Channel Sales and
Distribution, Merchandising and Pricing Architecture, Franchise Management with an
aim to achieve organizational goals. Prior to working with Fabindia, Venkat was
working as the Regional Head North (Peter England) with Madura Fashion and
Lifestyle (Aditya Birla Group).

Aman Sir, What do you think is so different about FabIndia or whats the factor that
has been the differentiator in its segmentation and positioning strategy?
Mr. Venkat FabIndia is a very different brand as it caters to a very niche segment,
(1) because it has a brand legacy as it is a 50 year old company and (2) as its punch
line says Celebrating India as it sources and procures fabrics, apparel from the local
GI artisans and more than 70% are handcrafted keeping in mind the quality standards.
Fabindia also showcases the largest platform for Indian handicrafts and handloom
sector, connected with 50,000+ artisans. One platform for all not like the state specific
ones. Also there was been more professionalization in terms of management change
where in new minds have been roped in from different companies like Madura
Garments, Tata, Arvind, Biba, etc. Also they have started focussing on channel sales
and the turnover is expected to touch 1000cr this year from 400cr in 2012-13. This
shows quantitatively how Fabindia is progressing as in the garment retail sector
brands are not growing at more than 10% whereas Fabindia is growing at 22-23%
YOY for last 3 years.

Aman Do you think the social connect Fabindia develops in the customers has been
a great pull factor for the company?
Mr. Ventak Fabindia has a social connect with all its customers and it helps people
relate with Indian ethnicity. Fabindia has a lot of loyal customers even without giving
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away any promotional discounts the growth is unbelievable. The trend is such that
people who care about quality and substance do not think about promotions if they are
satisfied with what they have.
Aman What is the sourcing structure of FabIndia and what are the future expansion
strategies?
Mr. Venkat Fabindia has close to 10 procurement hubs, all the rural clusters
consolidate at those procurement hubs thereby having a formal structuring of supply
chain and also leading to one cost one price throughout the country. Fabindia has 90%
company owned company operated, almost 220 stores out of a total of 250 stores
throughout the country. We started franchises 2 years ago mainly for the Tier II and
Tier III cities. We might look at opening up wall spaces in stores like Shoppers Stop
and Lifestyle but as of now we are focussing on smaller cities as the franchise models
like the ones recently opened in Meerut, Haldwani, Ghaziabad, etc. In smaller markets,
franchise brings lots a value because of their better understanding of the market and
the behaviour and we are targeting opening about 200 franchise stores in the next 5
years.

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Alexa.com Brand Positioning Analysis

To evaluate the behavior of a Fabindia customer we took help of ALEXA.COM, a
website which surveys the traffic on any given website and the data obtained from it
was analyzed by our group. Given below is the analysis of online traffic data of
fabindia.com

(Source: Alexa.com)

FabIndia is one of the popular apparel brands in India and it is able to generate 40.75%
traffic on its site organically i.e. without spending anything on promotions. It is a wellrecognized brand and most people search fabindia for purchasing apparel. It can also
be observed that out of top 15 keyword searches that lead to fabindia page 9 are
related to apparels. Fabindia kurta is iconic in itself.

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Given below is a comparative study of type of sources of traffic from different websites
which play in the same domain as Fabindia. Some of the bellow mentioned brands
also have their offline stores. The graph clearly shows that Fabindia has the highest
organic searches out of all, which is the direct indicator of its popularity among the
masses and its edge over the other brands.
It can also be observed that it has a pretty decent social media presence and is able
to generate 14.03% of traffic through social media platforms.On the map of global
presence it can be observed that Fabindia is not a widely global brand as 90% of the
visitors are Indians but it has a minor presence in US (4.5%), Singapore, UAE and
Canada.
FABINDIAS COMPARISON WITH OTHER PLAYERS IN SAME DOMAIN

(Source: Alexa.com)

The data given above shows the demographics to which Fabindia caters to. The
results have been obtained by comparing total internet population with the audience
of fabindia.com. Here it can be clearly seen that the brand is equally popular between
males and females. It does not divide its audience on the basis of gender and has
been able to maintain an image of unisex brand. On the basis of education, it can be

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observed that most of the people who buy from Fabindia are well educated. This is
mostly due to its prominent presence in urban areas and metropolises, also most of
the stores of Fabindia are located in posh locations of the city.

DEMOGRAPHICS OF FABINDIA CUSTOMER

(Source: Alexa.com)

The results have been obtained by comparing total internet population with the
audience of fabindia.com. Here it can be clearly seen that the brand is equally popular
between males and females. It does not divide its audience on the basis of gender
and has been able to maintain an image of unisex brand. On the basis of education, it
can be observed that most of the people who buy from Fabindia are well educated.
This is mostly due to its prominent presence in urban areas and metropolises, also
most of the stores of Fabindia are located in posh locations of the city. Fabindia is
famous among youngsters as well as the elderly. Most of the visitors of Fabindia are
18-34 years of age. There is also a substantial population of 55-64 year olds who visit
Fabindia. The company uses all natural fabrics and natural organic colours which look
and feel sober. This makes it the clothing of the intellectual class of India and the same
makes it popular among the older population.

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Fabindia clothes are perfectly priced to cater to middle and upper middle class
sections of India. It can be seen from the data available that most customers of
Fabindia earn between $0 - $60,000 annually. The consumer has a unique brand
image of Fabindia that it is ethnic, natural, simple, not - flashy and connected to the
Indian roots. In one instance when Fabindia tried to offer its customers designer wear
through a store in khan market, New Delhi it failed as even the high class customers
of Fabindia demanded the regular clothing line of the company as that is what made
the brand unique. People walk into a Fabindia store to buy handcrafted, natural, daily
wear clothes.

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Segmentation | Targeting | Positioning

SEGMENTATION
Segmentation means to divide the marketplace into parts, or segments, which are
definable, accessible, actionable, and profitable and have a growth potential. In other
words, a company would find it impossible to target the entire market, because of time,
cost and effort restrictions. It needs to have a 'definable' segment - a mass of people
who can be identified and targeted with reasonable effort, cost and time.
Segmentation allows a seller to closely tailor his product to the needs, desires, uses
and paying ability of customers. It allows sellers to concentrate on their resources,
money, time and effort on a profitable market, which will grow in numbers, usage and
value. [9]
There are various criteria for segmentation such as geography, demography,
behaviour, gender, personality etc. A company may segment the population for better
targeting and positioning of the product and it also helps the firm sell differentiate the
market and chose a target market for its different product lines.
In case of Fabindia the segmentation can be considered as follows:
1. Geography:
The core customers of the company is the urban Indian living in metropolises
almost 90% of the 220 stores of fabindia are based in metros. So company
does not really segment the market on basis of geography it has a clear cut
strategy of catering to the affluent urban population of India
2. Gender:
Some of the companys products are gender neutral but being into clothing
business there is segmentation based on gender. It has a separate clothing line
for men and women and cater to their specific needs. Women have options of
sarees, skirts and kurtas while Nehru jackets and kurtas are proffered by men.
3. Socio-economic status:
Fabindia devides its customers into middle class and the upper middle class.
While the clothing line is priced such that it caters to both middle and upper
middle class some other products of the brand such as personal care and
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furniture are priced a little higher and would be in reach of mostly the upper
middle class or the affluent. Also the customers of the Fabindia are well
educated i.e. at least graduates. the company lays emphasis of organic fabrics
and simple colors something which is reflected throughout the product line of
Fabindia, whether it is personal care, furniture or organic foods. Fabindia is
often considered the brand for the intellectual.

TARGETING
Targeting is the actual selection of the segment that the company would want to serve.
The target market is the group of people or organizations whose needs the product is
specifically designed to satisfy and most likely buy the product.
Fabindia targets the well-educated, affluent urban population of India. It targets both
Male and female by proving them differentiated and customised clothing lines. Most
of its clothes are unisex and can be worn by both genders alike. There is separate
clothing line for children. The company seller similar clothes to people 18 and above.
Although Fabindia has introduced new designer clothing line for women which is
priced higher than general clothing line.

POSITIONING
Fabindia has positioned itself as the an Indian ethnic, simple, elegant, organic
material, handmade and natural colour brand. It is same in the sense to other Indian
ethnic wear brands as it sells kurtas and sarees but what differentiates itself from its
competition is that it makes ethnic clothes for daily and casual wear and not for parties.
70% of Fabindias clothes are handmade and it lays special emphasis on using natural
fabrics like cotton and silk. It has positioned the brand in such a way that it has created
a niche for itself in the clothing and retail industry. Its customers are willing to pay an
extra premium on the clothes for their quality and appeal and the brand is very famous
among the affluent urban intellectual Indian and most of the Fabindia customers are
strong loyalists.

Final Positioning Statement

TARGET AUDIENCE SHOULD BE THE URBAN MIDDLE HIGHER MIDDLE CLASS WHO VALUE
ORGANIC AND SOCIAL INVOLVEMENT AND ARE WILLING TO PAY A PREMIUM FOR SUCH
PRODUCTS

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Conclusion
Fabindia has a very different growth story compared to any other company not just in
the retail textile sector. Doing this project and studying and researching about the
company and customer preferences we got first-hand experience as a sales and
marketing consultant. Starting from the marketing analysis through SWOT analysis,
Porters 5 forces and PEST analysis we moved ahead with Alexa.com analysis and
ended with our own input of how the company is placed and what according to us
should be its segmentation and positioning strategy.
From our analysis we found out that segmentation can be done on the basis of
geography, demography and socio-economic classification. Next we concluded
that the target audience should be the urban middle higher middle class who
value organic and social involvement and are willing to pay a premium for such
products.
In the end we would like to thank our Professor In-change Dr. Kapil Kanwal Nayan for
giving us this opportunity to learn through live examples and set up a strong base for
future marketing courses.

References

[1] https://en.wikipedia.org/wiki/Fabindia

[2] Govt eases garment export incentives, Business Standard, May 7, 2016

[3] "How Fabindia's William Bissell is changing the rulebook of business". Economic
Times. Nov 2, 2012.

[4] http://www.fibre2fashion.com/industry-article/2269/handloom-industry-inindia?page=1

[5] CSR Report of Fabindiahttp://martjackstorage.azureedge.net/inresources/bd5c1517-8d80-48d7-8e8e365433ad124f/Images/userimages/PDF/CSR_Annexure-I.pdf

[6] https://alexa.com

[7] Marketing Management, Philip Kotler & Kevin Lane Keller

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