Non-metro cities boost Tata CLiQ’s luxury biz
Premium- Pandemic opens new pockets of wealth for the luxury vertical to Tata CliQ
- Average order value for Tata CLiQ shot up as people got into buying pricey goods online
NEW DELHI : The spurt in online shopping that has come as a result of the covid-19 pandemic has led to a sharp growth in business for the luxury vertical of Tata CLiQ, with the bulk of its orders originating from non-metro markets such as Bihar, Assam, Uttar Pradesh, and the parts of Northeast India.
The Tata group-backed e-commerce marketplace’s luxury microsite sells products such as watches, clothing, and accessories. It has also expanded its presence in categories such as beauty, kids, and home and added categories such as audio, gourmet food, and golf. It recently tied up with its Tata Digital-owned online grocery store BigBasket for gourmet food.
“We have been in the business for five years now and have seen tremendous growth year-on-year and covid has really accelerated this," said Gitanjali Saxena, business head, global luxury at Tata CLiQ.
Revenues have grown substantially in the last 20 months, Saxena said. “We have also seen average order value shoot up as people have become more comfortable buying products with higher price points online. There are a lot of pockets of wealth within India, where people have a lot of money and awareness of brands, but perhaps don’t have a trusted source of accessibility," she said.
On a standalone basis, revenue for Tata Unistore, which runs Tata CLiQ, rose 58% to ₹358.62 crore in the financial year ended 31 March 2021, from ₹226.64 crore in FY20. Net loss, however, widened to ₹362.01 crore from ₹270.87 crore during the period, according to company filings with the registrar of companies and accessed via business intelligence platform Tofler.
Prior to the pandemic, Tata CLiQ Luxury got 45-50% of its orders from non-metro locations. This has since risen to 60-65%. The average order value has also jumped 10-12%, Saxena said, Categories such as high-end watches have grown 300-400% since the pandemic began, she said.
Consultancy Bain and Co. has pegged India’s retail market at $810 billion, the fourth largest in the world. It said the market is quickly evolving to include a sizeable e-retail component with an online shopper base of 140 million and online retail penetration of 4.6% at the end of March 2021.
In the home category, which includes products such as home décor, linen, and furniture, Tata CLiQ’s luxury vertical is recording a fourfold growth every year. “Following the coronavirus outbreak, a lot of time is being spent at home and products such as higher-end serve ware and dinner ware grew. We saw a big increase in this category and that was a surprise to us because people had the time to look at and spend on their homes again," Saxena said.
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Saxena expects the luxury vertical to clock 2.5-3 times growth over the next five years.
New categories such as beauty, home and gourmet are expected to grow at a disproportionate rate, she said.
By building a unique space for itself, the company had possibly benefited from tailwinds in the e-retail space during the last year, when the country was severely impacted by the pandemic, the company said in its filings. The e-retail industry significantly increased its pace of growth with some niche players succeeding in doing business differently, it said.
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