In an interview, Akhil Jain says that the company plans to more than double the contribution of non-apparel categories as it looks to build a more experience-led fashion business
Women’s fashion brand Madame is sharpening its focus on profitability while expanding beyond apparel, targeting an Ebitda margin of over 15 per cent. As part of this strategy, the company plans to more than double the contribution of non-apparel categories such as accessories and fragrances to 18 per cent of overall sales over the next two to three years, as it looks to build a more experience-led fashion business, its top official said.
In an interview with BW Retail World, Akhil Jain, Managing Director (MD) of Jain Amar and Chief Executive Officer (CEO) of Madame noted that the company is prioritising profitable growth over chasing store additions or topline targets, with omnichannel customer expansion taking precedence over physical footprint.
Instead of setting an aggressive store-count goal, Madame is aiming to grow its active customer base from around one million to 1.5 million over the next two years, while keeping the option of external capital open in the future to fund technology upgrades and accelerate growth. On quick commerce, he said the channel is unlikely to become a meaningful growth driver for the brand over the next one to two years until technology enables seamless inventory unification across channels. Edited Excerpts:
Nearly two-thirds of your business comes from non-metros. How do store productivity, average bill values and repeat purchases compare with metros today?
For us, our repeat rate in the non-metros, the Bharat that we call today, is as high as 65 per cent. In metros, it is about 42 per cent, which I feel is pretty genuine, because we have such a large floating population, a lot of population being added to the metros every ever now and then, especially the students, which become a major part of my customer persona as well. With people coming into universities in the metros, we target a repeat ratio of anything above between 33 per cent and 45 per cent is healthy. And I think we lay somewhere in between.
You have spoken about higher real-estate costs and different consumption dynamics in South India. What changes are you making to ensure that the next phase of growth is not disproportionately dependent on North India?
As we expand across different regions of India, we have realised that consumer preferences are incredibly nuanced and cannot be approached with a one-size-fits-all mindset. Every market has its own cultural influences, lifestyle preferences, and fashion sensibilities, which shape what consumers are looking for.
I often share an example from my travels across the Northeast. Even within locations that are just 50 kilometres apart, we observed distinct differences in customer preferences, particularly around silhouettes, hemlines and styling choices. These variations highlighted how local culture and consumer behaviour influence fashion choices at a very granular level.
Understanding and responding to these regional nuances is what we call cracking the “India code.” It requires deep market insights, continuous learning and a highly localised merchandising approach rather than simply replicating the same assortment across every market.
You have previously mentioned that accessories, fragrances and other non-apparel categories have become a significant contributor to the business. Over the next five years, what contribution do you see these categories making?
Non-apparel, for us, is almost 8 per cent as of now out of the total business that we do. We are eyeing to scale it up to as high as 18 per cent in the next two to three years. It is kind of wonderful because when we talk about experiences, it is not just about selling clothes anymore. It is all about delivering that experience and selling the looks to the consumer than just a pure product.
Your airport stores appear to be performing strongly, particularly for accessories and fragrances. How different are airport consumers from regular fashion shoppers and could travel retail become a meaningful growth vertical in its own right?
Not all airports in India deliver the same numbers, barring say Hyderabad, Bangalore, Delhi, Mumbai. These are the airports where the level of consumer is high enough to start shopping for fashion from these locations. But the stores that we have, say in Pune or Srinagar, for example, they do not deliver that kind of ASPs. Numbers are still there, but the kind of ASPs are not there.
For us, curating the right merchandise at the airport, given the square footage is pretty low at a very high cost, so the curation of the right merchandise becomes very important. Usually the airports, for us, stock slightly higher ASP products than the stores as well, because the window for us to entertain the consumer becomes very short at the airports.
Madame had earlier guided towards a certain revenue milestone while improving Ebitda margins. As you look ahead, what is that magic number?
It is less about the revenue, it is more about hitting an Ebitda margin of over 15 per cent, which is today slightly below 10. This is what we look at as of now going forward, because the Ebitda margin has to have everything else fall into place.
When it comes to store count, is there any number in mind on that front?
These numbers keep changing because we are now in an omnichannel environment. Is is not about just the touchpoints. If I am working with an active customer base of say million customers today, will I be able to service 1.5 million customers in the next two years is what I look at now.
It has become omnichannel now. Even if I do not have a store in Bangalore for example, but my revenue from South India is fantastic because of my presence with other formats and other service providers, marketplace and everything. For us, the next target is 1.5 million customers.
As you look at the next phase of growth, do you believe the existing model is sufficient to achieve your long-term ambitions, or could we see greater investments in company-owned stores, acquisitions, new brands or even external capital at some stage?
Absolutely, with the kind of competition rising real estate costs, and the requirement of a lot of technology interventions, just being bootstrapped is not enough if you want to scale slightly quickly. If you are very happy with organic growth, you are still fine doing it, but if you want to show some rapid growth, yes, obviously you need some capital infusion, primarily because technology is now going to play a very vital role.
For example, if you talk about understanding your store’s behaviour through the video streams of the CCTV that is installed over there, it takes some technology investment to understand the consumer behaviour by not just being on the store. Because you are pan-India, or internationally also as well, so technology interventions are required. Legacy companies like us who built brick by brick, for us, technology interventions like these become a key part. Had it been a fresh company startup now, they have all the latest ERPs and the AIs of the world to start as a base platform. For us, it is all about overhauling the existing system and then training, retraining our employees or rehiring new employees who understand technology better than the ones who have actually been there. The external capital is not the immediate plan, but it is always on the card for us.
Global brands, marketplace-led labels and influencer-driven fashion businesses are all competing for the same consumer. In such a fragmented market, do you think scale, brand equity or supply-chain speed will ultimately determine the winners?
It is more chaotic nowadays than it used to be before, with everybody who gets on the internet becoming a label or a brand and having widespread reach as of now. To put your things in perspective, I see that the brand equity, yes, it is sustainable and it will sustain.
For example, if you see brands like us, we have been here for almost 30 years in the market in the category and we have seen the onslaught of so many local players, national brands, international labels coming in, but India is such a growing market as of now, the pockets are extending from India to Bharat and to the remote areas, the villages. The market is expanding that whosoever is entering the market probably is not cannibalising anyone, but yes, they are making a mark for themselves and it is a game of about 10 to 12 years to understand that if really a label becomes a brand and the brand becomes sustainable or not. It is a journey and in India there is place for everyone as of now. We are still away far away from saturation.
You have taken a cautious approach towards quick commerce, arguing that fashion is not an immediate-need category. What would need to change for quick commerce to become a meaningful channel for Madame, and do the economics work today?
It is more of an economical decision than more of a geographical expansion decision, because what happens, especially with fast fashion, you can always put your core product onto the dark stores or through the quick commerce channels. A is how many styles per SKU, because we deal in colours, sizes, and different product types. It is not a standardised product, like a handkerchief, which is square and white or colourful.
We did try a little, but then we cautiously took approach that no, as of now, because we are talking about inventory unifications. For us, as of now, fast fashion on quick commerce, I do not think for the next one or two years, till a kind of technology supports us, where we can unify our inventory, so that we have the complete exposure of what is where and can that be exposed to different channels, if not that channel.
