IPL - a reason to increase consumption

That the IPL was aptly named NRIPL by India’s Times of India newspaper is already public knowledge. Most of us not just liked the idea (although many felt the sarcasm was not called for!) but also felt the depth of those words – how the IPL which could have added over 1,000 Crores during the current economic slowdown to various Indian businesses (such as Airlines, Hotels, Restaurants & Bars, Forex money changers, Taxis, Tour Operators, etc.) have lost it out to some other country! And I read today that the tickets for the first two days were sold out in a few hours since online bookings commenced. Not surprising for another Cricket Crazy Country.

What I always liked about IPL 2 was its timing & dates – during the evenings and summer vacations; kids and adults can watch the Game at their homes/clubs/restaurants/bars et al. Am sure, this would certainly bring a BIG impetus to the heavily troubled F&B Industry across the country (footfalls have gone down by over 40% atleast in Bangalore, I am told) and people have become extremely choosy about what they are consuming. So, Restaurateurs must be planning their special menus & combos. Good luck to them.

I also hope the supermarkets are planning their bit too – Merchandisers and Buyers must be stocking Processed Food, Ready to Eats, Colas and needless to say, loads of beer and spirits. For an excitement starved Retail Industry over the past four months where families have reduced even their regular monthly purchases, am sure the next two months would bring more footfalls and higher sales, atleast on these specific categories. With the Cola companies planning a slew of new product launches and new campaigns already in place, am sure the thrust for higher throughput is not just incidental but a fact that they have to work very hard upon.

And not to forget the increased home deliveries – not just the ready to make Pop Corn sachets, wafers and Colas from the nearby Kira... errr.. the “Organized” Retail Stores, but also Pizzas and other food items from the local food joints. That the college exams would be over by then and some youth would have fun doing their bit of part-time jobs is sure shot – just that they must be encouraged to do so. (I have done that in my teens and I can vouch how exciting it can get).

This is the best time to increase manpower especially for door deliveries and work 2-3 weeks in advance, (that’s actually now) to tell the neighbourhood that they are ready for home deliveries. While I was in Hong Kong during Christmas 08, almost every meal that we had at my friend’s home where we stayed was ordered – on the Internet. There was this Guju restraurant closeby; make an order and pay online and you get your food at your doorstep in 30 minutes or lesser! Well, I know we are not yet so very “Organized” or ready for e-commerce, but am sure this is a good time to make a beginning... a reason to increase consumption. Needless to say, I do believe that consumption will result in higher growth and not necessarily otherwise. Wishful thinking! Let’s see what my neighbourhood has to offer.

The “un-nano” Effect...

That the TATA Nano would be the world’s cheapest car was always news. While I was in Germany in June 2008, critics were arguing about the safety this car would provide – No Air Bags, No ABS... well, well. I had to tell them that the top speed that we do atleast in the metro cities (during peak hour traffic) is 40km/hr and the top speed on a NH (between Blr-Chn or Pune –Mum) would be 90 km/hr. One may cross this speed at times, but would have to brake often due to cattle and their owners freely strolling on the once “village roads” – now converted into eight lane highways!

So, I would justify, that with the reliability backed by the TATAs, the space (and probably more of a M800), and pricing of two two-wheelers (for a household) and the comfort of four adults travelling together, this car is surely going to knock & rock every household across the country. Just like how its elder sibling did 10 years ago – like how auto rickshaw drivers slowly but surely migrated upwards to the Indicab!

But the larger role that I see for this “SKU” is the effect it could have on the Retail Industry – the so called Organized, the Unorganized and the Disorganized! It wouldn’t be a bad idea for Retailers to procure one car each and place it at their stores during the current economic slowdown when shoppers are shying away to even enter Retail stores, forget splurging like before. And just like the core categories, this car to be placed at the end of the store and – footfalls would grow multi fold, conversions would be higher and needless to say, shoppers would probably be buying more than now.

I don’t know how Mr. Tata and his Retail team would be thinking, but in five years from now, I see this car available for purchase at PDS Outlets, Gram Panchayat offices and even the weekend mandis across villages! I have always believed the saying that higher consumption leads to growth and what better way. Our rural consumers are probably a bigger bet than their urban counterparts. But what about roads in these villages, one may ask? With an estimated outlay of over INR 10,000 Crores planned by the NHAI in the coming years, these roads would actually be a reality soon. Deep interior villages in certain states such as Tamil Nadu, Gujarat, Madhya Pradesh, etc. are already examples of what can be foreseen.

And in larger cities, if the TATAs use their existing and future TRENT/Indicom outlets, one can imagine shoppers buying the Nano along with their Grocery/Household/ Telecom products. By the time a shopper finishes his/her shopping, the car could be serviced or water-washed and ready for takeaway! Or, if the car was already given for servicing on a Saturday or a Sunday morning, then by the time the family goes for their weekend/monthly shopping at the hypermarkets, the Car is already ready! Wow.

Now, all the above and more are not just a result of my mental diarrhoea but wishful thinking as I would believe. The phrase “power of dreams” actually belongs to another car-maker from Japan, but for India’s own family of dreamers and achievers, whose family name stands guarantee for everything that a household needs – from Sugar to Salt to Steel to DTH services to other daily use products, am sure, this “un-nano” (pardon my grammar) revolutionary effect would be visible in times to come. And who knows, I could actually be a part of it, if not merely watching it with pride and patriotism!