Zudio, the dynamic value fashion retailer, has revolutionized the offline retail landscape, offering stiff competition to other apparel retailers Rare is the sight of someone entering this store and not emerging with a distinctive shopping bag.
This trend underscores the brand’s irresistible appeal. Now, let’s delve into the core of the brand, examining its extensive reach and analyzing the strategic marketing approaches that form the foundation of its success
1. Background about Zudio
Zudio, a fast fashion retail clothing brand, falls under the umbrella of Trent Limited, a subsidiary of the Tata group, and was established in 2016. Since its inception, the brand has experienced remarkable growth, expanding its footprint to 411 stores across 130 cities in India (Source: Investor presentation, Sep 2023) . The strategic vision behind Zudio’s launch was to leverage its swift and responsive supply chain to emulate the success of the Western brand ZARA, aiming for widespread recognition and popularity.
Operating on a franchise-owned company-operated model, Zudio has exhibited a gradual and consistent expansion, particularly in tier one and tier two cities, increasing its store count from 57 in FY 20 to an impressive 411 in FY 24. The revenue generated by Zudio currently stands at INR 3500 crores. This robust growth trajectory underscores the brand’s success in establishing a formidable presence within the competitive landscape of the fast fashion retail sector.
2. Advantage of shared resources
Trent, Tata group’s retail arm, started in 1998,has been operating Westside, a retail fashion chain offering branded fashion apparel, footwear and accessories for men, women and children, along with home furnishings and decor. It has over 200 retail stores across the country.Tata Group has also been Inditex SA’s partner running Zara stores in India for over a decade. While Westside targets middle class and upper class consumers who are looking for fashionable clothing and accessories, Zudio was launched with value based pricing for trendy yet affordable clothing appealing to a wide customer base. It benefits from shared resources, infrastructure and supply chain capabilities.
When everyone today is glued to online shopping through apps etc, How has Zudio managed to disrupt offline retail to gain so much popularity through its store only model?
3. Zudio's Strategies
- Affordable fashion : Zudio caters to price conscious consumers who are looking for trendy and fashionable clothing at an affordable price. One can get a captioned T shirt in Zudio at as low as Rs 200 price point.
- Private label strategy: This means it has control over the entire product journey from design to distribution, resulting in competitive pricing and high-quality products.
- Inventory management : Zudio stores offer fresh styles by swiftly refreshing their inventory. This resonates with the Gen Z and millennials who are always on the lookout for trending fashion. In this context Zudio avoids stocking merchandise which are seasonal such as winter wear.
- Unique in store experiences: Zudio stores are large format stores (6000-8000 sq ft), follow organised displays and a simple minimalist black-and-white aesthetic directing attention solely toward the variety of its garments. Unlike traditional stores organised by style or size, Zudio organises its racks by price, allowing customers to easily find offerings within their budget in one glance. Stores are very spacious and well lit which make them very experiential and instagramable. There is no concept of paper bills.
4. Zudio Social Media Play
With very low marketing spends, Zudio leverages word of mouth advertising as a powerful channel. It also utilises social media to connect with customers and promote its products. It capitalises on strategic collaborations with relevant niche influencers.It puts a lot of emphasis on user generated content like photos and videos which bring products to life with authenticity and fosters a strong sense of community. The best publicity is when customers like a product and spread the word. Zudio instagram posts have a very good engagement rate.
5. Competition
- The value apparel segment is projected to witness a compound annual growth rate (CAGR) of 6% from 2020 to 2025, but the organized sub-sector is expected to surpass this, achieving a 13% CAGR.
- The value fashion segment, at ₹2.5 trillion as of CY20 (57% of the total apparel market), is one of the largest and fastest-growing segments within the apparels market. (Source: Livemint article, dated 20 Nov 2023)
- Huge opportunity beyond the metros and tier 1 cities, driven by better demographics, higher incomes and better aspiration within the customers
Following the success of Trent’s Zudio, the national retailers have been compelled to come up with Value fashion segments such as Yousta (Reliance Retail), Style-Up (Aditya Birla Fashion and Retail), and InTune (Shoppers Stop).
6. Conclusion
Zudio stores are always full- so to say it has caught the pulse of the young generation’s aspiration of always staying fashionable at an affordable price. The retailer identifies markets where there is an aspirational consuming class, aware of fashion and lifestyle trends. Small towns like Vapi, Davanagere, Solapur, and Jharsuguda have been put on the retail map. It is scaling up quickly to increase its presence in Tier III and IV towns which are witnessing a consumption boom never seen before, fueled by aspirational demand, ease of digital payments, and social media. Zudio with its affordable pricing, fast fashion keeping up with the latest trends, and a lot of posts on social media is doing it right to attract the young crowd.
If you are looking to drive higher impact from your marketing , feel free to contact us at alibha@daiom.in. And we would love to do an audit and help.
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[…] for brands to cut across multiple segments of consumers at a lower cost. We have observed this with Zudio, Tata Trent’s low-cost fast fashion brand that has taken the Indian apparel market by storm and […]