Tata Digital: Tata Digital stitching ‘value fashion’ plan under its Cliq brand

Tata Digital, ecommerce arm of the Tata Group, is working on building a ‘value fashion’ proposition under its fashion and lifestyle marketplace Tata Cliq as it looks to challenge bigger rivals like Flipkart, Amazon India and Reliance Ajio, multiple people aware of the development said.Cliq, which has a mass-affluent positioning, is in talks with several brands to enhance its value-for-money offerings, they said. Mass affluent would mean a set of consumers who are willing to spend higher amount of money on fashion and accessories.Cliq is unlikely to build a separate brand for value fashion but will partner with global as well as Indian brands to match the breadth of offerings from Walmart-owned Flipkart, Amazon and Reliance, they added.

“They (Tatas) have made several proposals – including (during the time of) the old team under former CEO Pratik Pal – to build a value fashion offering,” a person aware of the matter said. “Global brands from Canada and France have also been tapped that fit the bill. To compete with Flipkart and Reliance, they need to widen the offering and that’s why there is work underway.”

The Tata Group owns popular value fashion chain Zudio, but the retail brand will remain offline only and there are no plans to onboard it on Tata Digital’s super app Neu yet, people cited above said.

Zudio – led by Noel Tata – has surpassed revenue of Rs 7,000 crore in FY24 in yet another year of substantial growth.

Email sent to Tata Digital did not elicit any response until press time Wednesday.

Cliq was brought under Tata Digital last year as part of a restructuring to bring together key ecommerce businesses of the salt-to-steel conglomerate.

People briefed on the matter said Tatas have also been considering having an inventory play to widen its fashion business with the draft ecommerce policy being on the backburner.

“Flipkart has its own fashion play besides Myntra focusing on premium segments and Reliance has a clear edge over international brands. There is a thinking that Cliq is mass-affluent and needs to offer more,” another person aware of the matter said.

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Myntra clocked a gross sale of around $3.9 billion in 2023 while the same for Reliance Ajio is at over $2 billion, ET reported earlier. Tata Cliq has been trying to narrow its gap with market leaders.

“Zudio will not come online and that’s made clear–at least for the foreseeable future,” the person cited above said.

Besides the value play at Cliq, the fashion vertical is one of the key areas of focus that needs to be stabilised on the super app Neu, ET has reported earlier. Grocer BigBasket and e-pharmacy 1mg are two other large businesses on Neu.

“Group brand integrations take longer than they should, but with Cliq under Tata Digital, it has been relatively easier to work with…which is why (Tata Cliq) CEO Gopal Asthana has been closely involved with the commerce team at Neu,” said a person directly briefed on internal dynamics of the firm.

ET reported on May 20 that new Tata Digital CEO Naveen Tahilyani has revamped the executive team for the Neu super app following the departure of several senior executives.

A majority of senior positions across Tata Digital have now been filled with existing team members, according to an internal note from Tahilyani.