Wednesday, July 31, 2019

My Retail Journey with the Coffee King

I have sang praises for the coffee consistency across India. I have shared so many anecdotes about my most favourite Indian Retail brand. I have done case studies on what went well and what didn’t for my previous company. And I have also occasionally complained about a few things I haven’t liked, much to the chagrin of my former and present colleagues. But I never thought I would have to write such an obituary for my former boss, retail czar, coffee king of India and the most unassuming Late Shri. VG Sidhartha.  


My first premium coffee was at Barista, KNK Road in Chennai in the late 90s. But I preferred CCD over Barista for two reasons – there were more youngsters at CCD; it was easy on the purse (I hadn’t graduated to a wallet those days!). When we finished our MBA and received Certificates at the Convocation event, we celebrated the day at CCD Ispahani Center, Chennai. A few years later, I took a Shatabdi to attend an interview at Bangalore for the role of an Area Manager at Café Coffee Day but I was rejected for the role since at the time, the hiring manager preferred someone who could also taste the food to ensure they were in fit form to serve customers, which I declined being a pure Vegetarian in my food habits. In 2006, I happened to meet Mr. Sidhartha for the first time. CCD was chosen as the preferred café for the upcoming Bangalore International Airport in a tightly fought Tender process. As Manager – Commercial Contracts, I was solely responsible for designing, conceptualising, leasing and managing the retail areas at India’s first private Airport and was delighted to meet the Chairman of Coffee Day Enterprises who came to sign the contracts. He was taller than me and a taller personality with his trademark smile. 

Over the course of years, I happened to be on the other side when I joined CCD as General Manager – Business Development (Key Accounts) in Nov. 2009. My team and I were responsible for identifying and later setting up over 140 cafes pan-India at Airports, Retail formats, Cinema Theatres, Colleges, Hospitals, Metro Rail Stations, Railway Stations and even IPL Stadia. In this period, I would get to meet him at least twice a month or more when my team and I would present the potential locations on a giant screen at the 10th floor Conference Room of Coffee Day Square at Vittal Mallya Road. He was a very affable man, loved by everyone. When I visited his hometown Chikmagalur where the group runs a finishing institute where the children of coffee farmers of the region study basic skills of hospitality and coffee making, I have seen first-hand the gratitude, love and praise these kids and their families have showered on him. Many of them stepped out of their district for the first time only to work at a CCD across India. He took care of his people very well. Many of these staff members went on to join other popular Retail chains over time. 



Chairman, as we would address him was a stickler to time. Most meetings would start and finish on time. I would be asked by my Director to come to the Tenth floor at a stipulated time to make my Presentation but I would arrive 10 minutes before for a very selfish reason. His floor would have HBR Magazines which were very pricey those days to buy and read. So, I would make the most of my time to come up and wait and in that pretext pick up reading a few interesting articles. Would never forget those days of my life where I travelled across India, three days a week, over 40 weeks a year for two years non-stop. Today, I am known in the Retail Industry with two backgrounds – Bangalore Airport and CCD despite having worked at 5 iconic Retail Companies over the past two decades.

I owe whatever little name, fame and success I have achieved to CCD which gave me a global pedestal to learn and make a good name for myself. About 3 years back, I wrote to him seeking a small round of funding for my start-up. As expected, he replied quite soon however in the negative stating that his fund invested in maturing ventures and not really in start-ups. During one of our meetings, he quipped “This is your second coffee in 1.5 hours” and I replied “Sir, I drink 6-7 cups of coffee a day” to which he replied, “Boss, don’t consume so much coffee, it’s not good for health”. Who would expect a coffee czar to say this? But he did. Because he really cared for people. Pray for his soul to attain Mukthi and reach the foot of the Lord who created this world. Om Shanthi.

Pic taken at CCD Dharamshala (2010)  - boys were from Chikmagalur

Thursday, July 11, 2019

Elevating the Pantry Shopping Experience

I was at the FoodHall on Linking Road at Mumbai for a recce on behalf of an FMCG Brand that I am working as a Retail Advisor. This was my first visit to the store and I have heard quite a lot about the concept which has been around for over half a decade and with the number of Stores / Store business growing quite well, YoY. The 4 storied outlet spread over 6,000 sq. ft. approximately houses everything that a Food Bazaaar sells, from Grocery to Fresh Vegetables, Oils to Snacks and so on. Except that most Indian Brands do not find a place here. Most Indian “mainline” or mass FMCG Brands, perhaps. And its not just the merchandise that’s different, rather the entire shopping experience. With the assortment of products spread across the four levels, almost NIL promotions or Discounts and a very private shopping experience, I guess the concept has caught up quite well with shoppers. 

I did see atleast 3 Celebrities (Cinema related) in the 2 hours that I spent at the store. They had a private shopper along with them not just to carry a basket or push the trolley, rather to ably assist them in their choice of products to purchase. They seem to be at ease while just being there and of course the entire elevated customer experience which makes the format a hit with the high and mighty. 


Cut to 2002 when I used to run Foodworld Stores as Operations Manager. Even then, my store at RA Puram, would attract quite a bit of celebrities given that this was one of the premium locations in South Chennai. I would personally assist film stars likes Ms. Khushbu Sundar, Ms. Sarika Kamal Hassan, the former CEO of Ford India who would live at the Boat Club Area and the families of the top brass at Hyundai who had chosen this part of town to form small communities of their ilk. The reason for them to shop at an air-conditioned environment (in 2002) was not just convenience but privacy too. However, over the years, the much coveted “Grocery Shopping” has evolved along with Customers. 


Today, the good old Big Bazaar looks shinier than before. The Future Group has created a new vertical in FBB – Fashion at Big Bazaar which has actually evolved from the learnings of the apparel department of Big Bazaar. One would recall the Group sold its jewel-in-the-crown "Pantaloon" business to Aditya Birla Group couple years ago. And now they have built FBB from scratch as well as the upmarket Cover Story which is a dazzling women’s-only store with fast fashion curated from London & beyond. Similarly, FoodHall is a great evolution from the erstwhile Food Bazaar but with an elevated shopping experience. Note – the elevation is not just the imported olive oils and nuts, wide range of cheese, or organic vegetables, rather the entire experience. 


The FoodHall also has a Deli, a Café and a Chocolate Bar, an in-house curation where a Chef prepares fresh chocolates with a Tempering Machines to produce interesting cute-looking chocolates which costs upwards for Rs. 500 for 6 pieces. Connoisseurs Delight, perhaps. The Cellar stocks and sells some of the finest wines from the world. And the Fresh Poultry / Meat / Seafood is a massive hit with an exclusive area demarked in so manner that there is absolutely no stench that comes out of the area. Overall, FoodHall has elevated the Grocery Shopping in India. 



Recently, RP-SG Group which runs Spencers Retail acquired Godrej’s Nature’s Basket which is a similar concept as FoodHall but the latter beats the former hands down with it’s range, assortment, pricing and customer experience. There are similar concepts in all major cities but the trend is yet to catch up outside Delhi/NCR, Mumbai and Bangalore. Is the market ready for gourmet grocery? Yes. Are the Retailers / Mall Owners & Shopping Centres ready? Perhaps, No.  It’s not just the shop or the real estate that would elevate the experience, rather the Retailer’s vision and readiness to cater to this elite segment of customers. Actor Madhavan is the Brand Ambassador for Elite Matrimony (in this age and time when marriage is not an institution but more of convenience and social status). 

So the premium Customer not only exits but also waiting. Let’s see who expands first and fast.

Monday, July 1, 2019

Why Coke wants Coffee...


A budding second generation Entrepreneur started an Internet café in Bangalore’s iconic Brigade Road in the mid-90s with the unprecedented boom in consumers using the World Wide Web to communicate with each other besides knowing a bit more about the world on the other side. Those days, an hour of browsing the Internet would cost ₹100 and a cup of coffee, perhaps ₹10 or so. It’s no surprise the costs have reversed today. 
 


Cut to 2019, the same Entrepreneur is expecting a valuation of $1 billion for his coveted asset, Café Coffee Day which he has patiently and painstakingly built over the past 20 years. The café has over 1,700 cafes across India now including a few outlets abroad. I was privileged to work in this team a decade back for 2 years where my team and I went ahead to set up over 140 cafes across Airports, Metros, inside large Retail formats such as Wal-Mart, Shoppers Stop, Odyssey, at Hospitals, University campuses, Cinemas and even at Cricket Stadiums at Chennai and Kolkata during IPL Matches. The bidder for CCD this time is none other than Coca Cola Company, world leader in carbonated beverages who has also been in India for 2.5 decades.

Why does Coke want coffee? Because they see an untapped opportunity to reach out to the millenials in India who are among the largest of their ilk worldwide. Pepsi, on the other hand has a majority of its business coming from snacks and food while Coca Cola Company with its wide portfolio dominates the carbonated beverages market which has seen a shy growth in India, thanks to alternative beverages, let alone a few healthier options. CCD cafes interact with over an estimated 3,50,000 patrons a day with an estimated 100,000 bills daily (assuming an average 3 persons per bill). That’s over 1.2 billion times of engagement annually, something that Coca Cola Co. can do perhaps only online with constant advertising. 


A recent report published by Euromonitor states that the Indian Coffee Market was pegged at ₹2,500 crores as of 2018 and could double in the next 5 years. With cafes becoming the third and most preferred alternative place to hang around after home and work place, Indians are embracing coffee cafes and tea bars like never before. In the immediate past half decade, chains like Chaayos and Chai Point have gained much attention from Consumers as well as deep pocketed Investors. World’s biggest café chain Starbucks entered India a decade back in a JV with Tatas and has grown to over 150 cafes till now while others like CBTL and Café Pascucci left the market even as the homegrown Barista and British chain Costa have found a small niche for themselves. Interestingly, Coca Cola Co. bought Costa Coffee last year for $5 Bn while Nestle bough the distribution rights of Starbucks across Europe for over $7 billion in 2018.

Interesting times ahead for discerning Indian consumers. Would we see us drinking Coke and Fanta along with a Cappuccino at the neighborhood café or the Mall down the road? I don’t know yet. Interestingly, Sidhartha of CCD has refrained all along from selling carbonated beverages ever since the beginning. But the brand’s future could be different. We are now seeing Spicejet logo on the erstwhile Jet Airways’ crafts. Time will tell how this story spins out. And although it’s not in my plan today, I am already fixing my Auditor’s meeting at a CCD. For the love of the brand and their coffee.