News and Features

Cantabil shifts its business strategy, turns to no deep discounting

30 December 2019

Apparel Resources


Indian consumers have been dependent on traditional departmental stores for their clothing needs since the very beginning. But it was only few years back that they started shifting towards retail brands. According to a study by Technopak, the fashion retail market which is worth Rs. 2,97,091 crore (US $ 46 billion) will grow at a promising CAGR of 9.7 per cent to reach Rs. 7,48,398 crore (US $ 115 billion) by 2026.

However, this awareness about fashion brands and acceptance and adaptation for them among consumers did not just come over time. It, in fact, took a number of measures and strategies by the retail brands across the country to break the wall. Since pricing has always been one of the major factors for Indian consumers, deep discounting strategy is what the organised retail adapted to get closer to them.

Cantabil is one such brand, which acquainted with its consumer group as a discount-oriented firm, and made a place for itself in a competitive market. And the company is now slowly moving away from the discounting strategy.

Putting an end to discounting

The brand was offering its target audience discounts up to 80 per cent throughout the season during the 2011-12 period, which according to the management was because of the slowdown in the retail market. However, moving away from deep discounting strategy, Cantabil will now offer a maximum of 20 per cent discount on regular days of the year and up to 60 per cent during the end of season sale.

We are trying to move away from this strategy and change this perception in shoppers' minds in order to gain new consumers and increase revenue. Offering such discounts lets consumers cast it out on the quality aspect of the product and the company is being hampered by such deep discounts. The step will help enhance the belief of the customer on the product and simultaneously the profit of the company will also improve. Selling a product in deep discount lets customers have apprehensions in mind about the quality, maintains Deepak Bansal, Director, Cantabil.

Strategies underway

In an endeavour to change its discount-driven brand image, Cantabil is adapting to a number of measures including online and offline marketing strategies as also the social media marketing.

"During the opening of a new store, we have started doing aggressive marketing both in online and offline space and also follow a digital marketing kind of campaign. We have an elaborate database of our customers and we keep sending them information about new products, new campaign, etc. Also, we tend to increase the marketing budget based on the requirement and purpose. For the last year, we spent 1 per cent of our revenue in marketing activities," informs Deepak talking about the brand's aim to move away from deep discounting.

Back-end processes

There was a time when the firm used to manufacture for brands like Raymond, Benetton, Splash, among others. Moving forward and expanding the retail business, Cantabil stopped supplying to outside brands and now manufactures only for the in-house brands to fulfil the needs and demands of its own range of brands.

While it's easier to outsource what can be manufactured in-house, it does require going deep on the details in order to maintain the design aesthetics of the brand since the process of manufacturing and interpreting the same design could be different for two different manufacturing units. According to Cantabil, the design aesthetics are maintained by keeping in mind that the quality of the products meet the AQL of the brand and is not compromised at any stage.

Furthermore, Cantabil prides in having an in-house design team that analyses various fashion trends with the help of forecasting engines online and offline to come up with the right trend.

Big future plans

Presently, with a retail presence of 270 stores in around 16 states, Cantabil is aiming to open 75 stores every year, targeting Tier-3 regions. The stores will be a mix of company-owned and franchisee outlets, and Cantabil will invest around Rs. 15 crore for the expansion drive. Cantabil has been in the market for years now, and has already had a good presence in the bigger markets including Delhi-NCR and other Tier-1 cities. Moving forward, the company is targeting Tier-2 and beyond regions for a better market familiarity and brand presence.

Cantabil clocked a revenue of Rs. 290 crore in the financial year 2018-19, and is aiming to grow the numbers by more than 30 per cent reaching Rs. 390 crore in the current fiscal.