Sunday, January 28, 2007

Shopping Karne Chale Kya ?

Today many Indian companies are floundering and retail is pitched to be the next in-thing. Big names like Bharati has tied up with Walmart for its initiative and Reliance wants to foray in this domain on its own. The truth is that till date, with a few exceptions the vast majority of Indian retail firms have failed to become truly competitive. Most of them may have a clear blue-print for expansion and growth, have the best of resources (management and infrastructure) but what they lack is delivery. In any form of business or consulting work, the nature of end product or output, either tangible or intangible is what makes the difference.

The right strategy for Indian retail companies is to differentiate themselves by offering unparalleled service. This I say because in the competitive global market, the quality and price of most products have narrowed to the point where it is only service that distinguishes companies. In most of the service oriented business, customers are lost not because of quality or price but because of service. Service builds on the proven capability in any competitive bazaar economy, which will decide the penetration factor of the behemoths.

My personal experience in shopping has proven this point to an extent. We have the best of brands from all over the globe flaunting our malls and shops but we are dull in creating an experience called “shopping”.

shopFirst talking from an Indian perspective, Why do we shop ? If you read the mind of a typical Indian it follows the Maslow’s hierarchical pyramid. One kind of shopping helps us fulfill our basic needs for food, shelter, water, etc. But as soon as you move a few levels up, one comes for ego/esteem shopping. It’s the sort of non-essential shopping that gives one confidence and a little high walking out of a store swinging shopping bag-laden arms. All this is possible because of the ample extra money an average Indian has today, the changing demographic profile, the huge domestic-driven demand and life on a fast-track lane fuelled by plastic cards.

All know the difference between going to the market to buy food to sustain us and going to the mall to buy items to substantiate us. In the second case, the shoppers are looking for a relaxing shopping experience after which they feel soothed and renewed as the malls in India have now become centers for fun and entertainment, a place for some good time. The Indian retailers know this for sure, but then why don’t they act ?

I have been to some of the stores in Europe and UK namely Carrefour, Tesco, Sokos, Salisbury, etc. Shopping for daily needs in these outlets is no different from purchasing in Foodworld, Sunday to Monday or Fabmall. But then when we graduate to a next step in the ladder, the high street international branded shops the situation is grim. Lets start with ambience. You walk into a shop and most likely you are welcomed by repetitive music [ mostly Kenny G or Yanni numbers as if they are the only musicians, this is just an observation to highlight the repetitive behaviour and not questioning the artists credibility ], mumbly and passionless teenagers as salespersons who work there. Then the trial rooms are nothing more than tube-like closets often stacked with boxes and most often someone knocks the door every 2 minutes to vacate soon as another customer is waiting.

And while none of us, would expect anything more than to be well looked after by the attendees of the shop, the reality is that the employees are poorly trained, have little knowledge about the products they are selling and in most cases virtually lack customer interaction skills. The reason for this is pretty simple, these employees are hired on a temporary basis and jump to new places with better offers in a short duration of time.The salespersons range from the prowler variety who loiter few feet behind you [ more if you are a female ] to the ones who are busy on their mobile phones discussing the last night’s movie. Customers are evolving in an era of information demography, therefore, the equation between consumers and marketers needs to evolve into one that’s based more on dialogue than on monologue, symmetry more than asymmetry, and on conversation.

Commitment to a service strategy means that you hire new employees on the basis of their attitude and train them on skills. Most companies do the opposite. To make shopping an experience, one has to deliver a threshold level of quality, price, and service. There being a small difference in the first two parameters for most of the competiting brands in the same business, the third one plays a pivotal role.

Clearly the service, the comfort and the pleasure all seem to be missing. This may be one of the reasons, I feel is responsible for the low sales in the international branded, posh shops. The rates are almost similar to the European or the American ones in these stores, with a small drop here and there. Hence the customers who travel abroad very frequently on business or for leisure trips can get the same stuff from outside if the customer commitment and attention factor is missing.

When will the retailers come to know that the consumers are not there just to buy things, they are buying an experience. Since this has something to do with one’s self-esteem, courtesy, immense interest and making the customers feel like kings and queens does make an impeccable difference. Perhaps today’s retailers need to visit the sari store or road side dhaba to sharpen superior delivery skills and servicing traits. The employee in a typical sari store opens a hundred saris within five minutes in an attempt to sell a single one. Similarly, the waiter in a typical restaurant or dhaba delivers the customer’s order in few minutes and he even comments which item in the menu goes well with which dish. Practically there’s no way an international brand can sell jeans sitting on the floor cross-legged but many things can be learnt. Never rush and give honest advice while the customer is in the midst of his/her experience called "shopping" and be rest assured that the no one will exit empty handed if the former two points are taken care of. Reason : The customer's ego and self esteem is pampered.

Compare this to what you see today, where some grand shops with big names wear a deserted look with lots of window shoppers. The merchants who have occupied these shops complain about low footfalls and poor conversion percentage [ratio of those who buy to the total number of visitors], despite the fact that malls are mushrooming like weeds in Indian towns,cities and metros. The customers have an emerging mindset and are ready to splurge but their purchansing power demands excellence. Is the market ready for this ?

Keep reading and remain connected.

[The views are personal and my points on these are what I see in the daily life these days.]


At 4:07 PM, Blogger Sur said...

Service is 'the' word not only in Retail but in any business, I feel. The bottomline being that the customer should 'feel-good'.
Organised retail in India is still in its nascent stages,it will take some time to put its act together.


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