Retailer Myntra headhunting McKinsey consultants
Myntra, one of India’s leading online fashion stores, has in recent months headhunted several high ranked consultants from McKinsey & Company. While the influx of the brightest minds in the consulting industry have according to analysts been instrumental to its recent success, critics however worry that while the ex-consultants will deliver it world class strategy, its lack of focus on implementation will hinder the reality of its potential.
The Bengaluru-based Myntra, which earlier this year was acquired by Flipkart, has expressed its faith in McKinsey & Company. Since 2013 ten former McKinsey consultants have joined the retailer, and now fulfil executive and senior manager roles at the online retailer. Their key task: expanding Myntra’s 60% share of India's online fashion market.
After eight years at McKinsey, Abhishek Verma, comments on his new role as Senior Vice President and Head of Private Brands at Myntra: "I knew that e-commerce is the sector I had to be in." In his new role, Verma is to expand the scale of Myntra’s ten in-house brands – with the aim of the brands capturing a 30% share of India’s online market. Also recently acquired by Myntra is Rahul Chaudhary, who stepped over from McKinsey in September, and works as Vice President of Strategy. Another new face from McKinsey is Sidharth Gupta, who joined last month, and took on the role of Vice President and Head of Strategy and Corporate Development. It is not only high-profile McKinsey staff that are being head-hunted by Myntra, Vishnu Dutt Sharma was hired in October, who is an ex-consultant at The Boston Consulting Group.
Headhunting consultants is a markedly different strategy from other market players, such as Jabong. Some of those whose job it is to headhunt talent are also finding it baffling why Myntra is investing so heavily in ex-strategy consultants. "It just seems ridiculous to me," comments a partner at an executive search firm on condition of anonymity to India’s Economic Times. "So many engagement managers, senior associate, principal-level people from McKinsey are being hired as Vice Presidents. I am not sure what the thinking behind this is, but it just doesn't seem right. It seems the company is focusing too much on strategy and planning when it should be thinking about better execution." Myntra sees things positively however. "Next year will be the one when we will see the real growth story," said Verma. "Before that, there is work to be done and that's what we all are working on," he added, referring to the firm's focus on strategy.
The acquisition of talent by Myntra is happening at the same time as India’s online retail market is going through explosive growth, with online sales almost doubling since 2012. That growth is only expected to expand further, a report by venture capital firm Accel India, released earlier this year, stating: "Given the young demographic which is shopping for latest looks online and increasing choice online - we estimate that this category will see 400% growth in the next three years and rival electronics and mobile category in GMV (gross merchandise value)." This growth, Accel India found, is on the back of improving mobile shopping infrastructure, rising sales of smartphones, better connectivity, and quality retail websites and apps. Accel estimates that 200 million customers will shop through e-commerce sites over the next three years. As it stands, the value of online footware and fashion sales accounts for Rs 3,150 crore, a mere 1% of total purchases in India.
