Myntra CEO: Our sales target is $5 billion by 2018

India, News

Online retailer Myntra is aiming to achieve $5 billion in gross merchandise sales volume by 2018-2020, the company’s CEO told ET.

“Currently, we are about $500 million in GMV. We plan to double it to $1 billion in 2016 and are aiming at a $5-billion GMV by 2018-2020 timeframe,” Myntra CEO Ananth Narayanan told ET on the sidelines of a private label launch in partnership with Bollywood actor Deepika Padukone on Monday.

Private labels contribute about 20% to Myntra’s sales annually and the company wants to push more such labels as part of its strategy to achieve profitability in the next 18 months. The company has already launched private labels such as Roadster and HRX in the past.

“Fashion is one such category which has higher margins. My strategy, from January 2016 onwards, will be to keep fixed costs constant. With more scale, fixed cost absorption will become better” said Narayanan. Myntra claims to be the largest player in online fashion retail space in India, which has a total retail market size of $500 billion. E-commerce is just about 3-4% of it.
Myntra’s announcement to achieve a path to profitability may be in the larger scheme of things for its parent Flipkart which may plan a public listing in 2-3 years. “Listing apart, profitability is always good for a sustainable business. Unit economics have to work at the end of the day,” said Narayanan. As a result, the company is also planning to rationalize discounts in 2016. “We will build a discount strategy for different segments to rationalize discounting,” he said.
Myntra will continue to focus on its app-only strategy. “Our GMV is 60% higher than what it was in preapp days last year. Of course, we saw a 10% dip in sales after the migration (earlier this year), but that was expected in the short term,” he explained.

Myntra claims to have achieved a 3.6-fold increase in GMV this year in the Big Billion Sale, which ended on October 17. The company which has over 20-million downloads of its app counts the three cities of Bengaluru, Delhi and Mumbai as its largest customers. “By 2020, we expect online channel to contribute 12-15% of total fashion apparel sales in India. Currently, it’s about 1.2%,” said

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