01 November, 2015
TieCon Chennai 2015 - Highlights
16 January, 2015
Breaking fast the traditional way!
23 October, 2014
EMIs to the rescue of Retailers
19 October, 2014
The iPhone Saga continues...
07 September, 2014
Sync-ing customers with Technology
Technology Consultancy IDC India projects annual smartphone sales growth of around 40 per cent for the next five years in this price-sensitive nation.
This is a delightful news for Retailers selling mobile phones and accessories. Univercell, Chennai based Retailer of technology products including smart phones, feature phones and related gadgets has grown consistently over the years and is rated No. 1 in terms of their network, Strategic Locations, Innovative Marketing, Friendly service and most importantly, a wide array of products across various brands. The Retailer, recently launched its newest format, rightfully called "Univercell Sync" at the tony Nungambakkam neighbourhood in Central Chennai. The store, spread over about 800 sft is strategically located to enthuse passersby to drop over. While the brand is quite popular in the city, the new "Sync" suffix is sure to attract a lot of people to get inquisitive and enquire the details about the new initiative.
The store layout is interestingly divided as various zones for purposes such as Photography, Music, Work, Accessories and Kids. Gadgets are displayed utility-wise rather than Brand-wise, which is a great way to encourage customers to choose the right gadget according to their uses. Global giants such as Apple, Samsung and LG share the display space with home grown Micromax and Karbon. However, the phones are still displayed price wise within the display areas so buyers can choose within the price range they require.
I was pretty impressed with the Music zone, especially. If CDs killed Music Cassettes fifteen years ago, the iPod killed the CD players a decade ago. Today, most of music is stored and played digitally and handphones have most of them, since people prefer to have a single gadget for making calls, taking photos and for listening to music. The display also includes music gadgets such as speakers, bluetooth devices to stream music, ear phones, head phones and cables to connect. With the touch of a button, its quite easy to connect one's phone to many of the devices and have a live display, which would aid buying the right product quite easily.
I was also quite intrigued with the kid's zone - a special area for interaction with the young ones - kids can hang around and explore various interesting things about the gadgets and the friendly staff are also helpful to teach them a thing or two.
Overall, the store is a notch above the hundreds of retail stores across the city that also "sell" mobile phones. The Univercell Sync stores dont just sell, they rather provide a very unique experience that the next-gen is looking for. Do drop over at the store in the coming days and enjoy a world class experience and share your thoughts.
The store is located at:
New No. 103, Old No. 52,
Nungambakkam High Road,
Chennai.
Landmark: diagonally opp Basics Store.
24 July, 2014
Online Dining
I have enjoyed my pizzas better at the restaurant that at home, all along. It is more to do with the fun of dining – you plan a trip to the pizzeria, a walk or a short drive usually, or even at a Mall after finishing retail therapy. I fondly remember the bottomless Coke and unlimited Pizzas at Pizza Corner in Chennai in the late 90s during my most cherished college days with my gang of friends. Have ever since been a fan of pizzas and the love has only been growing. Frankly, I like pizzas from different places, be it Dominos or Pizza Hut, California Pizza Kitchen or standalone indie restaurants. One of my most favourite of course has been from “Italia”, the fine dine restaurant at The Park, Bangalore. For me, Pizza is an all time snack. I am usually game for a pizza at any time of the day (or evening) although I avoid a heavy dinner of pizzas. In fact, the love of pizza is more because of the yummy accompaniments, the cheese garlic bread and an array of toppings, especially the gherkins and olives. Am not a big fan of coloured flavoured colas and would rather prefer a strong coffee if not a lemon ice tea to drown the heavy food.
What I like best is food to be served hot and fresh from the kitchen. Haven’t been a big fan of home delivery or takeaways since I feel that the freshness is somehow lost, especially the international fare such as pastas, pizzas etc. although Indian food is still doable – we have an option to reheat the curries and biryanis at home once again which can’t be done with pizzas and pastas. Have avoided ordering pizzas at home for a long time now since I have had not-so-great experiences in the past, but that was probably because I used to live in Bangalore where the ambient temperature outside is not conducive to serve hot food by road.
This Football season, I decided to order pizzas at home. No, I don’t follow the game but why not enjoy the delicious offers provided by F&B Retailers! So, first it was Dominos followed by Pizza Hut. On the first occasion, the pizza arrived pretty late, almost 45 minutes since I ordered. I was very disappointed with all the promises made by the company on various media, but gave a benefit of doubt to the delivery boy – he must have had a lot of orders to fulfil and mine was probably the last one. So, I didn’t make an issue about it and just left it there. Yes, I would give them a try once again in future and I hope they live up to expectations.
On the next occasion, the pizzas were served hot and were in a consumable condition even after 20-30 minutes of being delivered at home. What was surprising was it was a Sunday and was the day of the “Final” match between the two teams. And yet, the pizzas were sent on time, well ahead of the promised time. They have a future customer for sure!
In both occasions, I used the mobile applications of both these companies. The UI for Dominos is a bit confusing while the one for Pizza Hut seemed much better. In fact, I had to switch over to the website while ordering for Dominos since that seemed to be a better option. The UI is perhaps not designed by retail experts and with consumer feedback, it lacks the sensibilities that customers look for, especially people of the older age and for women, both of these segments may not be very mobile savvy. Also, one of my friends quipped on his Facebook post recently how the delivery boys call a number of times to take directions. The Pizza companies can take a cue from Uber, the taxi service guys who have a GPS enabled map on their cell phones that help the drivers reach their destination without even calling once.
Mobile App Zomato also integrates Home Delivery along with providing reviews about restaurants and they are growing rapidly not just in India, but also internationally. Overall, I guess online dining, or rather online ordering is a great way to reach out to customers. It is also non-intrusive in a way. There is no need to call a number and go through the menu being repeated often – the menu is just there on the mobile app or on the website and helps users to choose what they want quickly and easily. Once customers are used to it, they would rather prefer this option instead of calling on the phone, whenever they desire to order food home. So, go ahead and try ordering on your phone next time. And yes, do take a minute to share your feedback. Happy Dining…
12 June, 2014
Online Grocery Shopping
There has been enough spoken and written about the Flipkart-Myntra deal. Online Commerce is no more a hype at the moment and there is no money to be made – that’s the response most subject matter experts are saying although they don’t want to be quoted since they are in various advisory capacities for many such companies. With a healthy two-digit margin, if offline Retailers are not able to succeed (read: profitable), then how would these companies survive- they ask. Having said that, there is not a single ECommerce company (in India) that has tasted profits yet. While many promoters have made millions of dollars collectively, the companies in question still remain unprofitable. I would presume that a very few of them would even be making unit level margins. Such is the discount structure and focus on Topline that these companies are almost forgetting that the main intention of a business is to create value through profitability and not just a valuation (to subsequent investors). Amongst the online frenzy across categories, the most dreaded and the most challenging category is grocery & daily needs including fruits and vegetables. Bangalore based BigBasket.com already has some headway while WeStaple.com from Noida and a few others who are regional players are taking the lead to establish their positions. Big Basket even has a Mobile app for Android and iOS from Apple. Take a look below at what their customers have to say;
https://www.facebook.com/Bigbasketcom
http://venkysundaram.wordpress.com/2013/05/29/why-i-stopped-using-bigbasket-com/
https://www.facebook.com/WEstaple
K Ganesh and his wife Meena Ganesh are an entrepreneur and angel investor-duo. BigBasket, which is run on a daily basis by the founders of e-tailer Fabmart, on the other hand, is one of India’s only online grocery stores. Online grocery stores have been seeing big traction around the world, as recurring orders prop up the profitability of the niche e-commerce category. “The Series B funding for BigBasket, which should close in the next three-to-four months, will be around $40- $50 million. We believe it has huge potential, with gross margins of nearly 20 per cent. Every order is profitable for us on BigBasket,” Mr. Ganesh told The Hindu.
Bigbasket founder Hari Menon, a successful entrepreneur who sold his brick-and-mortar retail chain Fabmall and Trinetra to Aditya Birla Group, is bullish. “It’s a huge, underserved market. Convenience is a major factor in our metros. We are finding that at least 85% of our customers return after the second order.” Menon said that revenue is increasing 20% each month. Bigbasket delivers 4,000 orders daily. In Mumbai, where the average size of an order is Rs1800, it does 800 deliveries each day. The site has served 200,000 customers so far and is expanding to Delhi and its suburbs. Menon said the company did Rs85 crore ($14.3 million) in revenue in 2013-14 and was on course to do Rs200 crore ($33.7 million) in sales this fiscal year.
While the category is exciting, most customers seem to expect the savings (on real estate) to be passed on to them, which in reality is not. If the Real Estate savings are about 10-12% on Sales, the promotions and marketing costs are much larger than that, especially the first-time acquisition cost of customers. While most players do not offer much of discounts for every item, there are chances of combined savings when you buy more quantities or multiple brands from the same company.
However, the overall sentiment seems to be simple- customers would buy products online only if they value their time more than the time spent in shopping offline at Retail Stores such as Spencers, Foodworld, Nilgiris, Big Bazaar, etc. India has a huge density of Kirana Stores while Organized Retailers in the big cities are already quite popular for more than a decade now. Fruits and Vegetables are still preferred to be bought from the vendors who sell fresh quality items, most of them directly sourced from the Markets. Retail FDI in multi-brand retailing is a contentious issue and even the new Modi-led Government is not actively pursuing this at the moment, for the benefit of the trader community who form a big chunk of vote bank.
Online Grocery, at the moment is restricted only to those who work in odd-times, say BPO Employees and many others who would find it difficult to shop at a nearby store especially those who live in far off suburbs. Having said that, the Kiranas are much more active these days, offering various facilities such as door delivery to credit facilities to their customers. While Online Grocery has a great future, time will be a real reckoner.
25 May, 2014
Embarrassing Customer Moments
What customers rue most about is when a predictable customer service goes awry. Especially, if one has been pampered all the while for quite some time by the same team probably and that one negative experience makes a customer flare up very badly. Case in point is my own experience. I have been privileged to own and use a Mahindra XUV500, a premium SUV from the house of Mahindra & Mahindra, one of the leading automotive companies in India. M&M in short is more popular for their heavy vehicles and trucks but came up with India’s first SUV more than a decade back with the launch of “Scorpio”. Initially built as a five-seater, the marquee vehicle has indeed grown to become one of the most sought after SUVs in the country for its ruggedness and inimitable style albeit a bit old-fashioned. In fact, India’s incoming Prime Minister Narendra Modi has been using one for so many years and his Victory Sortee a week back at Delhi whilst standing dangerously on its foot board was a very popular photo doing the rounds all over. M&M launched its refined SUV to target the upwardly mobile with its premium SUV by the name XUV500 (read as XUV five double O), or Xtreme Utilty Vehicle with 5x Oomph. The vehicle is a master piece although it had teething issues soon after its launch but were rectified sooner than anticipated. Over time, consumers started appreciating the vehicle and it has gained acceptance among urban and rural users. It has won so many awards for its superb styling and road-handling abilities. I have been using it for about 2 years now and have driven about 30,000kms. In fact, I drove about 2,000 km over a week earlier in May 2014 all across Tamil Nadu, Kerala and Karnataka. The drive was superb, comfortable and exciting. Interestingly, XUV doesn’t have a Brand Ambassador as such and relies heavily on social media such as Twitter and Facebook and also has a mobile application for Android and iOS. In fact Mr. Anand Mahindra acknowledged and retweeted the selfie picture I had posted on my account.
M&M has done something which no other Auto Company has done till now – they have created a separate service centre for XUVs and premium models of Scorpio, so as to ensure that they are able to segregate customers and provide a superior experience for some. While the idea itself has been debated heavily within the Automobile Industry – whether it is a good idea to treat customers differently, the staff at M&M say that the profile of XUV customers is a few notches above those using other models and hence deserve a better experience. I have had a great experience all along with them and I have indeed enjoyed visiting the service centres, not for minor issues or major but as and when I have had a significant one which is few in number. M&M also provides a complimentary pick-up and drop of vehicles for its premium customers. During my recent interaction when my vehicle had gone for its 3rd paid-service, I had a very bitter experience with the service guys. They had over charged me, had not informed me the contents of the bill clearly and replaced parts which were in good condition. When I asked for clarifications, the staff was flummoxed and regretted their mistake.
What upsets customers is when they feel cheated, especially by a team which has been managing their vehicles and the relationship quite well all along. It takes one small mistake and a goofy moment by one staff member who has been preoccupied with something or the other to lose all the brownie points that have been scored over time. Marketers must focus on consistency of service, be it at the Retail Store or After Sales Service. One negative experience is all people will remember for a long time to come despite best efforts put in by the team for the sake of customers. Its not just the staff of the Brand who get embarrassed but also the customer since they had never expected to be let down by their favorite brand.
28 October, 2013
Chennai Airport is a sham(e)!
Even before I was part of the exciting world of Airports (in 2006), I have always been a big fan of the commercial opportunities at transit points, be it the railway stations or bus terminals, let alone airports. It was always a craze to have a cup of coffee at the railway station when we would go over to pick up our loved ones arriving from long distances, especially if the visits were made once in a couple of years. It was yet another joy to consume within trains – from Rajdhanis to Shatabdis to the passenger trains that would have hawkers selling everything from peanuts to guavas to oranges to chips and snacks. The joy of consumption during travel would somehow take over the joy of travel itself.
I have been using airports for just over 15 years now. My first flight was to Mumbai from Chennai to attend a job interview with a leading Retail Chain, with air tickets being sponsored by the company. That was the first time I was inside an Airport terminal, although I have been several times before that to drop off or receive guests from the Chennai Airport. The airport was and continues to be an important piece of the growth story of the state (of Tamilnadu) as well as served as a gateway to the rest of Southern India. In 2005, when the Government of India announced privatisation of Airports, the most protests were seen outside the Chennai Airport, the maximum being only second to the city of Kolkata. The staff of Airports Authority of India (AAI) and allied agencies protested that their livelihoods would be lost if the airport was privatised. The Government succumbed to pressure; Chennai’s loss was to the gain of Bangalore and Hyderabad. Both the cities claim to be the Gateway to South India and came up with world class private airports in the outskirts of the city in 2008, albeit the cities have been growing faster in their respective airport corridors over the past 8 years. Mumbai and Delhi somehow managed to keep the privatisation tab on. Delhi’s T3 Airport Terminal, which is managed by the GMR Group was built in record time and is now ranked among the top 5 in the world, consecutively for the past 3 years. Mumbai Airport, managed by the GVK Group built two new terminals for Domestic and International passengers and is struggling the political onslaught for space within its precincts which has been occupied by the public at large. Kolkata and Chennai Airports were allowed to be redeveloped by AAI and the work completed early this year with a time overshoot of over 9 months and a cost escalation of several hundred crores.
According to a recent survey by passengers on sleepinginairports.com, Kolkata Airport has been ranked 2nd worst in the world, with Chennai following a close third. What an infamy for a state which is considered the Detroit of India housing majors such as Ford, Nissan, Hyundai, Royal Enfield, Ashok Leyland, Hindustan Motors, MRF Tyres, Saint Gobain, Nokia, Samsung and many more! Chennai Port handles one of the highest loads in the peninsula. Chennai’s knowledgeable crowd contributes significantly to the Indian economy with Chennaites occupying important positions in the Indian Government as well as in global positions worldwide. And we have such a dud of an airport!
I feel quite disappointed, first as a citizen of the country and then as a resident of the city to pass through such an unglamorous airport every week, when I travel on work. The facilities are poorly planned. The Four Cs of airports, Comfort, Convenience, Cleanliness and Customer Service are shameful, to say the least. The only saving grace is the imposing façade which looks attractive for those passing by on the Grand Southern Trunk Road outside, but nothing more inside. There are no refreshments available outside the terminal, save for a sole counter which sells local cuisine at thrice the price of what’s sold downtown and a small kiosk of Café Coffee Day. The check-in hall has two ‘counters” where one needs to stand and eat snacks or sip coffee, just next to a dustbin which usually overflows, as though it’s a sort of a punishment. There is no bookshop or any other similar offering around; the only thing that solves passengers’ woes being the complimentary newspapers. The Departure areas are even worse. The layout of shops and other convenience is so bad that one would rather not step in than feeling disappointed thereafter. Cookieman and Frech Loaf are the only saving grace in the mess, although tehir products are meant to be take aways rather than consuming then and there. No Foodcourts or QSRs, just a restaurant located at the far end of the terminal. Services such as Taxi Operators and Forex are abysmally managed, with long queues for taxis in the peak hours in the evenings with unavailability of taxis for passengers. Airside services such as baggage handling are terrible. There are only four baggage belts and checked in luggage may arrive anywhere between 15-45 minutes after you land at the airport. There are only four aerobridges and the buses which provide ground transportation from the terminal to the aircrafts are poorly maintained. There is no complimentary Wi+Fi within the terminals. The airline staff and security staff from Central Industrial Security Force or CISF have a similar attitude as those who manage the airport – one that is indifferent and unfriendly. After all, it’s not just their fault since there is no one to oversee how good (or bad) their service towards passengers is.
I still believe there is hope. There is a plan to privatize the terminals through an open tender and the decision is expected to be taken by the end of this year with work to begin early 2014. Senior Executives from the companies which plan to bid had visited the airport to conduct a survey two weeks back were apparently welcomed by protestors from AAI, shooing them back not wanting privatization. But this time around, the Government doesn’t seem to back out. Hopefully, good sense would prevail and the airport would be handed over to a competent agency to serve passengers better.
An Airport is the face of a city and must display pride of place. It is the first point where international visitors to the country alight at. It is indeed important to put up a great one and maintain it as well. Lets hope.
22 October, 2013
Luxury at a Discount!
It’s a misnomer that Luxury Brands do not discount. Of course, they do. Just that they don’t do it so loudly and obviously as other premium and streetwear brands. Except for brands such as Louis Vuitton, Rolex, Mont Blanc, to name a few, most other premium brands promote discount sales, albeit succinctly. In most cases, they are not at their own stores but at cozy 5 Star Hotels, where the Brands hire banquet halls and quietly carry on with their business. Even then, they need to communicate what’s on offer and choose smartly created advertisements and place them on national dailies. The purpose of hosting these so called “Exhibition cum Sales” is to ward off the junta crowd, most of them being on-lookers. The moment the venue is a Star Hotel, window shoppers would think twice to drop over. It doesn’t look nice, quite obviously to take a public transport to such a venue. Secondly, shoppers still feel intrigued to browse and shop in star hotels, traditionally where luxury products are being sold world over, with India not being an exception.
The other genuine reason is also that we do not have high quality luxury retail spaces in India except for the DLF Emporio Mall in Delhi, the Palladium in Mumbai and the UB City in Bangalore. While there is a small hub by the name Bergamo in Chennai (at Khader Nawaz Khan Road), the RPG Group is coming up with a luxury destination in Kolkata. Apart from these, there are hardly any retail spaces that fit in to the luxury brands’ portfolio. And that’s precisely the reason such Brands choose 5 Star Hotels as venues.
Over the weekend, one such event was hosted at The Westin, Chennai. Prada shoes for Rs. 25,000, Fendi belts for Rs. 15,000, Gucci Wallets for Rs. 18,000 and much more. Yes, these are apparently discounted prices. At 11.30am, on the only day of sale (being a Sunday), the room was full of discerning customers. Though there were hardly a few pieces in each line, most of them were being bought by those who had dropped in. Many of these brands are not available at Retail Stores in Chennai and shoppers have to travel either to Delhi or Mumbai or probably outside of India to get one for themselves. The smart sales team were even wooing visitors with catalogues, taking orders thereby fulfilling sales orders. The display of items was not as what one would expect in a Retail Store for such products, but perhaps suited well for the “Exhibition” theme.
I tried on the Prada loafers, size 11, but felt it was too tight. As is always the case, the prices were not mentioned on the items, be it wallets or shoes and many people who are price conscious would rather not dare ask for prices, unless they were sure to buy!
India needs varied Retail spaces. What we have now are either too large malls that cater to the middle class or star hotels that house Luxury Brands. We do not have suitable spaces for luxury brands. Malls chains like Phoenix Market City are cordoning off certain areas within the mall for luxury brands. Express Avenue, the only Mall of over a million square feet in the hart of Chennai has created a nice mix of brands. Its so secluded that regular shoppers don’t even pass by that side.
In the meanwhile, keep looking for advertisements in newspapers like the one above. You may be able to get a good deal on your favourite luxury brand in town!
30 September, 2013
Airport Retailers get an added advantage
28 September, 2013
Restaurants in Malls…
I was recently at Forum Vijaya Mall (Chennai), one of the newest in town. It was a Sunday and I was there for lunch, but the upper level of car parking was almost empty around noon, which took me by surprise. However, I was told two days later by someone who works for the Mall that there were over 45,000 footfalls on that day. The Restaurant that I was supposed to visit was located on the second floor of the Mall. As is usually the case, I checked the reviews of the restaurant on the Zomato app on my iPhone. Most of them had written good things about the place and its menu, not to forget their wonderful service. Here is a sample;
After such a good meal, the bill came to around 2500 bucks. "Not bad at all!", we thought, given the amount of food we had eaten. The service too was perfect. The waiters were very watchful, responsive and most importantly, proactive. – Amruth
A great place with tastefully done interiors and food! The options on the menu are limited, but every single item you are served taste good and also look really good on the plate! – Nandhini
If I have to be perfectly honest, there could not be a more unfortunate location to host such a lovely restaurant. A mall in Vadapalani is hardly any place for a classy place like this. Where venue fails, Salt takes North Indian Cuisine and gives it a fantastic twist, to ensure they stand out from the others. I expect much more of this restaurant in the near future. – Vaishnavi
Apart from many reviews, the one above set me thinking. Are Restaurants in Malls a viable option as compared to those on high streets? Are Mall shoppers the right TG for specialty restaurants in Malls? For the cost of operation in Malls, do restaurants make any money at all as a business option? When I spoke to the gentleman who runs the restaurant, he mentioned that the rent is about Rs. 65 per sft per month. Assuming they have an area of 2,000 sft, their rent per month would be about Rs. 1.30 lakhs. Add to that all other expenses which would be around Rs. 2 lakhs pm. On a conservative estimate of Rs. 15 lakhs of sales per month and an operating margin of 50%, the store would recover its expenses and have an EBIDTA of about Rs. 2 –3 lakhs per month. Given the way the outlet has been done, their investment would have been about Rs. 70 lakhs. So, the restaurant makes about Rs. 25 lakhs in profits (before interest and taxes a year) and would take about 3 years to break even.
On the contrary, business would be double, if not more were it to be on a High Street. There are a number of good quality specialty restaurants that are garnering those numbers already. So, why do Restaurants still prefer Malls? Perhaps, Brand building and familiarity. I don’t see any logical reason why someone would invest so heavily in a Restaurant inside a Mall and wait for 3-4 years to break even, when it could be faster in a High Street. What works best are for established brands such as Rajdhani, Sigree, Mainland China, etc. which have built reputation over the years and have hence chosen to be within Malls to leverage their brand value. For first timers in the Restaurant business, Malls are probably not the place to be in. This is not restricted just to Chennai but to other cities as well. I was at Chandigarh a few weeks back and they have a brand new Mall called Elante. I was almost alone at Chilis on a weekday evening, which is located in the same floor as the cinemas on the fourth floor of the mall. Restaurants in India’s most successful Mall, Select City Walk face the same fate – Restaurants are empty through the week with weekends being their only busy times.
So, what ails Restaurants in Malls?
Mall shoppers are mostly for spending time, probably window shopping. Conversions for Retailers too is lower than on high streets. The sheer number of footfalls make up for lower conversions and therefore helps Retailers and Restaurants. Unless you are a destination such as a Shoppers Stop, Lifestyle, Café Coffee Day, Starbucks, Subway, KFC, Pizza Hut, etc. These are places which plan to visit and hence drop by. Eating out is way to expensive these days, given the cost of ingredients. And Restaurants are trying their best not to upset their clientele by absorbing losses as much as they can. But then, consumers are staying away from eating places on a regular basis, as was the case a couple of years ago. For example, a could of years ago, the neighbourhood area of Koramangala in Bangalore had almost 50 eating joints, a third of whom have closed over the last one year.
Mall hoppers prefer food courts instead, which are usually pathetically planned. Mall planners in India somehow do not build large enough food courts, with thousand of chairs and a breathable exhaust system, that are modular and scalable as and when consumers increase. Instead, they try to lease all counters at one shot thereby not having scope for further expansion in future. What would cost around Rs. 600 for a family of three in the food court would probably cost over 50% more in a fine dine restaurant within the Mall.
Restaurateurs would do well to experiment new concepts first on the High Streets. That is where people frequent. There are no SCAM, errrr CAM expenses (Common Area Maintenance) on High Street Locations and no restrictions to close the restaurant at a stipulated time. The biggest benefit of being on High Streets is that the signage builds familiarity among customers over time. No wonder, there are more successful restaurants in India and the world over on High Streets!
18 July, 2013
Car Care at its best
I pass through this outlet almost everyday but have always been on a rush. This time around, I stopped by and experienced first hand what they have to offer. I am referring to the 3M Car Care outlets which have sprung up across the country quietly but drawing attention from car enthusiasts and those who love to maintain their cars spic and span. These outlets are franchised and are managed by capable entrepreneurs who have an inclination towards the automotive business and customer service. Spread between 1,500 sft – 4,000 sft covering three different business models, these stores provide complete car care which include the following;
- Car Detailing
- Interiors / Exteriors
- Corrosion Treatment
- Films for sun protection
- Car Care products Retailing
- Car Graphics
- Customer Engagement
- DIY Bays
I was warmly welcomed by a service staff who knew his subject well – he explained the different packages they offered and justified why they were expensive. There were already two vehicles which were undergoing treatment – a Mercedes S Class and a Renault Duster. I asked him how is the business doing and he gave a smile, meaning things were doing quite well. Location was not totally a disaster though. It is located on the Beach Road, close to the iconic Light House (in Chennai). Although I felt it could have been located more strategically. Another gentleman walked over to me shortly and started interacting. Introducing himself as Vijay, he informed that he was the Franchisee Owner of the store. He explained in great depth his interest in automobiles, cars and bikes alike and his love for taking good care of them. According to him, the investment on the store including security deposit is around a crore (though I felt it was quite high) and the monthly business was about 15 lakhs with a margin of 35% on Sales.
The customer lounge is powered by lighting wifi and one can use the facility while the car is being spruced up. Customers have written their compliments and feedback on Post-Its, which is incidentally one of the most iconic products of 3M.
The company has taken up print advertisements recently which has helped increase walk-ins but what they actually need to do is much more – own the category and grow it too. The market size for Car Accessories in India is estimated to be over Rs. 1,000 crore, most of which is unorganized. Car Dealerships and private players like Carnation,3M, etc. have a huge potential, given the shoddy ways of getting your car done up at busy street-side shops. If marketed well, this could be a viable Retail model and is easily scalable. Like in many other cases, I see a bigger opportunity in smaller towns across the country where people take good care of their possessions.
For me, its about making up my mind for a 20K bill – sooner than later, I would be there!
20 February, 2013
For better conversions, provide solutions!
A couple of days back, I had a meeting in the city (Chennai, where I live three days a week when I ain’t travelling!). The host was willing to meet anywhere and after a lot of careful thought, I fixed it at Ispahani Centre at Nungambakkam, assuming it would take me an hour from the Royal Enfield factory/office in Thiruvottiyur to drive down to. As planned , I reached on time and we met at a café and spoke for an hour about business prospects. The location is not actually a Mall but a kind of community centre that was built almost 15 years ago, one of its kind to come up in the city. Many Retailers and brands such as Mr. Kishore Biyani’s The Future Group, Gaitonde, Florsheim, to name a few, put up a shop or two here and vacated sooner than later for various reasons – some for lack of relevant footfalls and some for high cost of operating. Whereas Café Coffee Day, India’s largest coffee retail chain has been operating here for over 14 years now; ditto for Marrybrown, a concept similar to KFC that serves Burgers and the like with specialty fried chicken on the menu. I finished the meeting on time in an hour and was heading out when I noticed another iconic brand which has quietly been operating here for well over 10 years. It used to be perceived as one of the most expensive brands till until recently they have started making products that are affordable even to the aspiring middle class lot like me. Their “sound” is probably one of the best although there are many more premium sound systems in the world. And the brand I am referring to is non other than “Bose”.
How many of you there knew that the name of the brand is also the surname of an Indian! Yes, indeed. Bose Corporation was founded in 1964 by Dr. Amar G. Bose, professor of electrical engineering at the Massachusetts Institute of Technology. His graduate research at MIT led to the development of new, patented technologies, and at MIT's encouragement, he founded his own company based on those patents. Bose Corporation established itself by introducing the 901® Direct/Reflecting® speaker system in 1968. With this introduction, Bose achieved international acclaim by setting a new industry standard for lifelike sound reproduction. The list of major technologies emerging from Bose continues to grow. Award-winning products such as Lifestyle® home theatre systems and the Wave® Radio/CD have reshaped conventional thinking about the relationship between an audio system’s size and complexity, and the quality of sound it produces. To know more about the company and its products, click here.
Coming back to the incident, I walked in to the store to find about about the Bose Soundlink™ Air which they have been advertising quite a bit these days. This product seems to connect using wifi with any apple device such as an iPod, iPhone or an iPad. So, I got into the topic directly with the sales staff who came across to be affable and knowledgeable about what he was speaking – a rarity these days especially in the Electronics Retail business. He explained about the product, gave a demo with my own iPhone 5 and was patient to showcase other models as well. At the end of it, I was a bit disappointed as the product was not a complete package. It didn’t have built in Bluetooth™ to connect other devices and the Bass effect was minimal. I explored a couple of other models but none of them suited my requirements. And so, I thanked him for his efforts and efficient demonstrations and started to move out when I noticed the headphones display. I already use a noise-cancellation Apple earphone on my iPod which I have been using continuously over the past few months. It’s a welcome relief since the external noise, especially that of an aircraft is almost unheard while in use. Ofcourse, it has its own disadvantage. One that it gets less white as the days pass by and the other is that since it locks itself inside the ear, at times it aches a bit.
The guy at the Bose store explained that the Brand has a special technology by which all mechanical sounds – any noise produced by an electronic / mechanical machine will be cut off once the head phones are switched on. I played “Comfortably Numb” by Pink Floyd from the demo iPod which they had and… Whoa! This was one of the best inventions that I had discovered. At Rs. 22,000 (USD 420), it wasn’t cheap either but I was too tempted to buy. After all, I have been longing for a great headphone for quite some years now. In my office job, I need to travel 3-4 days a week, usually 2 or 3 flights for over 2 hours each and road journeys of over 300-500km a day. And what better than hearing some soothing music all along.
The entire conversation with the guy at the Bose store lasted for over 30 minutes or so and he never once prodded me to “buy” their product directly – subtle inferences such as “When do you plan to buy this Sir?” “Take your time to decide because it is a worthy investment” “Apple devices are best heard on a Bose” to name a few. I was willing to wait and ask my wife to bring it along from London when she returns in sometime but the thought of owning a piece of marvel, a piece of history was too much for me to hold on to. Bingo – in the next few moments, I was having one on my hand for demo – billing done in less than 4 minutes flat. I have always been an impulsive shopper when it comes to technology albeit after a lot of thought and research & this wasn’t any different.
What hit me was the way the guy at the Bose store handled the Sale. He didn’t sell the product, not even the experience, but just like how a real staff of Apple provides you a solution – that’s what he did. I was walking back with a gleaming smile on my face, happy about my purchase. And that set me thinking.. If only retail staff were to stop selling and start providing solutions to customers… As the flute music of Pandit Haripraad Chaurasia reverberates on my ears through a Bose Quiet Comfort 3 as I write this column. Bliss.
29 March, 2012
Instead, they drive away footfalls!
I was recently in Chennai and happened to see an advertisement in the newspaper from a leading footwear Retailer announcing End of Season Sale and massive discounts. Someone within my friends circle had even mentioned about it on Facebook. Excited I was like many others, landed up at the store on a Saturday evening. To my utter disappointment, the store was in complete disarray. The owner was standing in one corner with a long face and the sole salesman was running pillar to post, literally. There were atleast 20 customers within the store – a few on the lower level and mostly women on the upper floor. I will not mention the name of the Retailer who is well renowned in Chennai and I only assume that this incident was an aberration than norm. Hope it gets better sooner than later. How I wish...
Some key learning that I took out of this episode;
- End of Season Sale is not just a season to liquidate stocks. It is also an opportunity to attract newer customers from across the town
- To mention “Upto 40% Off” in the advertisement and finally offering unknown brands at such a discount or lower is a wasted effort
- Women are slow shoppers – they spend on an average 2-3 times the amount of time than men while shopping and also try 3-4 times more footwear than men
- It didn’t make any sense to stock women’s products on the upper level – while most customers did walk up, it would have been a better idea to stock them downstairs and allow them more space to move around
- There were just two boys running around helping customers in each floor. Knowing fully well the additional footfalls that are expected due to the newspaper advertisement, it would have made sense that there were more helpers in the store to assist customers
- There is a tendency to believe that discount-seekers are of a lower profile than normal customers and hence it is ok to serve them less! Bad Idea! There were more cars parked outside the store than two-wheelers. And most of them who paid for the product used a debit or credit card
- Worst of all is to stock the products badly – in carton boxes and allowing customers to search for their sizes
At the end of it, I found nothing interesting that were on Sale; instead I walked out of the store rather disappointed. disgusted more on the owners’ interest levels and attitude than the fact that not much was available to buy! Will I visit the shop again? Yes. I guess it was more of a one-off case and would allow the Retailer to correct themselves!
A Firefly finally takes off
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