Big Bazaar's value added services at no extra cost boost sales

Tags: Retail| Kishore Biyani| Future Ideas| Future group| Big Bazaar| Ashni Biyani

Sarah Jacob

BANGALORE: Future Group's Big Bazaar is making its biggest move into Indian households yet. The value retailchain is not just retailing grain, but grinding it, kneading the dough and even making chappatis for its consumers-at no extra cost. Such services, including de-seeding pomegranate, grating coconut as well as cutting pineapple and jackfruit on the spot, are presently offered only at its prototype Rajaji Nagar store in Bangalore, but will soon be rolled out in all the 12 family Big Bazaar outlets across the country. "The idea is to take care of all the pains of cooking, to reduce the negative labour that families do not typically reward the women for," says Ashni Biyani, director of Future Ideas, the innovation and incubation cell of Future Group. "The consumer is familiar with modern retail and is willing to move to the next level," adds Future GroupFounder and Group CEO Kishore Biyani's only child. Industry watchers say the move will help Future Group, which launched value retailing a decade ago, win the loyalties of working women, students and singles with the new services. "This will help the company not just be relevant to consumers as international competition increases, but also in smaller cities such as Aurangabad, where the consumer may expect such services," says Raghav Gupta, principal at management consulting firm Booz & Co.

Big Bazaar has a team of 'sevaks' at the Rajaji Nagar store, which opened doors on Wednesday, to offer different kinds of additional services. If it's vegetables, they can be diamond cut, in cubes, for salad or sambar as per choice and zipped into a bag or chutneys can be whipped up. The store also has a tailor to stitch curtains and a vendor to dry clean carpets and provide after sales services for electronics. Future Group has also opened an office for citizen service centre Bangalore One, which allows consumers to pay utility bills within the store. With grain, the store allows the consumer to buy, for instance, a kg of multi-grain such as wheat, jowar and bajra. Once billed, the consumer has the option of getting it ground, kneaded into dough and even made into chappatis either for the full weight or in parts.

Introduction to Big Bazaar Big Bazaar is a chain of shopping malls in India currently with 31 outlets, owned by the Pantaloon Group. The idea was pioneered by entrepreneur Kishore Biyani, the head of Pantaloon Retail India Ltd. The idea from the very beginning was to make Big Bazaar very comfortable for the Indian customer. That was Kishorejis strength as a retailer. He had a lot of confidence in what he was doing, even though it defied conventional logic. Big bazaar is not just another hypermarket. It caters to every need of your family. Where Big Bazaar scores over other stores is its value for money proposition for the Indian customers. At Big Bazaar, you will definitely get the best products at the best prices thats what they guarantee. With the ever increasing array of private labels, it has opened the doors into the world of fashion and general merchandise including home furnishings, utensils, crockery, cutlery, sports goods and much more at prices that will surprise you. And this is just the beginning. Big Bazaar plans to add much more to complete their customers shopping experience. If one looks at Indian bazaars, mandis, melas, they are environments created by traders to give shoppers a sense of moment, of event, of place. They provide an inclusive environment where men and women from all castes, creeds and classes can come and shop at the same place. The founders of Big Bazaar were from the beginning very clear that they had to reflect the look and feel of Indian bazaars at their modern outlets, so that no customer would feel intimidated with the surroundings. In India most of us are not prepared for the consumerism that is setting in this country. We underestimate how many people are going to fly and that s why our airports get crowded. We underestimate how many people will speak on the phone for how many billions of minutes and therefore our cell phone networks are always congested. But the minds responsible for the huge success of Big Bazaar have captured and understood the force of consumerism that is unfolding. Big Bazaars all over India attract a few thousand customers on any regular day, and a lot more if they are offering something extra on each buy, which they normally are! And the sales force at Big Bazaar along with the executives is prepared for them. Objective of Big Bazaar The central objective for earlier businesses of Big Bazaar w was to bring in stability and consolidation. They were built to enforce order. However, in the new era where nothing remains constant, the dominant theme for businesses needs to be speed and imagination. The new macro-differentiator can be design. Design is helping companies to sell differentiated experiences and solutions that connect with the consumers emotions. Its no longer about selling products and services alone. Nor is it just about completing transactions. Every time

a customer walks in, it is an opportunity to build a relationship and invite the customer to become a part of the transformational scenario. Design management is helping us position the customer at the center of every decision we take and also operate with true entrepreneurial spirit. Target customers Big Bazaar targets higher and upper middle class customers because there has been growth in Indian middle class that has so far been used to buying apparel and groceries from small and cluttered neighborhood market shops is fast realizing the joys of visiting malls that have redefined the freedom to shop and entertain. Such malls are the new temples of leisure and weekend entertainment. Indias National Council for Applied Economic Research estimates that the nations middle class population currently comprises about 17 million households 90 million people with annual earnings ranging between $4,500 (2,400) and $22,000 (11,736). An additional 287 million could be termed as aspirers or those that hope to join the middle class in the near term. Rising incomes, particularly in the lower and middle-income households, are impacting retail growth in India as these groups tend to spend more on upgrading and diversifying their lifestyles, eating out and moving on to processed and convenience foods. Targeting young working class The large and growing young working population is a preferred customer segment for Big bazaar. These young people are early adopters of most modern product lines. The ongoing boom in sectors such as information technology and business process outsourcing has created a clientele with high disposable income and a increased demand for lifestyle merchandise such as watches, cosmetics and perfumes. This is a much-travelled and brand-savvy urban population. Interestingly, an estimated 40-50% of the Indian working womans salary is spent on apparel and footwear. Eating out, mobile phones and accessories make up the other leading spending options. Big Bazaar specifically target young, working professionals, home makers who are primary decision maker. Value for money All our lines of business are consumer centric and I believe that if we are to be in the larger consumer space, we would need to keep changing, evolving and accordingly be flexible in ourbusiness plans. Consumers are the same everywhere; we are only bound by our social systems. Their desires, greeds and needs are similar. The value for money proposition is so ingrained in the Indian consumers mind that he needs to be shown true value all the time. Therefore, all our current and future businesses would necessarily have the common denominator as the consumer.All our alliances and relationships with many companys have been built, keeping the synergies of business and consumer offerings in mind

Image Is se sasta aur accha kahin nahi Nothing captures the sprit of Big Bazaar better than this one liner. It is a simple statement and yet it positioned at the top of Indian customers mind. It shows that big bazaar was built on the foundation of entrepreneurship and simplicity. They believe in service and value for the customers. They consider that it is their only duty to keep customer in mind at every step, they go that extra mile and buy directly from source in bulk so that they can get best rates by keeping the margin low Big Bazaar is constantly on the lookout for finding new ways and means to improve the current state of affairs. Thus, innovation is a very important aspect of their working strategy. The other very important philosophy is that of Indianness. All the concepts and formats as well as the way of doing things are very Indian. The way Big Bazaar is designed and the way the whole concept has developed reflects a sense of Indianness. Merchandise
Main objective of the store layout is to maximize the interface between customers and merchandise It provides easy accessibility to the customers to view the offerings of the store. Layout of the store has

been strategically designed in order to make effective use of merchandise and passage to draw customers attention on stores offerings

Big Bazaar has a wide range of merchandise they have both branded and unbranded products like : Home lien items: Like bed sheets, pillow covers, carpets to kitchen utility items like steel utensils and crockery and other minor utility items required in a house Electronic items: like refrigerator,T.V, vacuum cleaner , music system, vacuum cleaner, washing machine. Etc Mobile Zone: A wide range of mobile phones and accessories is available at lowest possible price Furniture: All kinds of furniture is available that one may require to decorate their house. Star Sitara: In this section all kinds of cosmetic items are made available Opticians: In this section all brands oand types fashion glasses are available Men Ladies and kids wear: This section includes fashion and casusal wear for men ladies and kids both branded and unbranded.

Foot wear: In this section footwear for men women and kids is made available. Music: A wide collection of CDs DVDs is made available Toys: All kinds of toys for children is available Stationary: all kind of office stationery and stationery for school going kids is available

Location Big bazaar is located has 31 outlets in India , big bazaar locates itsoutlet near the commercial area and residential complexs so that they can cover all their target customers Eg : their outlet in phoenix mill , lowerparel mumbai , is located near commercial areas so that the working class people can drop in and shop house hold items after office hrs.

On the other hand their outlets in sangle is a bit different from what we would see at say , high street Phoenix in Mumbai. For instance isnt air conditioned: instead, there are air coolers installed inside the store ,also there are many shoppers there on days as an weekends . Unlike office going people in big cities , people in smaller towns do not restrict their shopping to weekends . The choice of location of Big Bazaar in many ways captures the essence of what they were doing- they adapt themselves to the habits tastes and preferences according to the location. One of the distinct feature of their location is that it is easily accessible and they try to locate their outlet in such a location where they can reach a large customer base. Services Big Bazaar provides a wide range of services to its customers like Trial rooms , elevators, car parking , security, baggage counter , trolleys so that one could shop easily They even provide them with after sale services in case of buying electronic items. One of the major service provided by them is one stop shop as one could get a whole range of items under one shop and at the most reasonable price. They always have their outlets in such a location where it is easy to commute. They have also given major emphasis to convince for customers in which layout has played a major role. The layout of the store is so effective that customers find their way out of what they want. Big Bazaar provides good employee service i.e their salesmen are always redy to provide help. Employee service is often neglected as part of good retail marketing but customer and employee interaction can be used as the significant tool for retail marketing.

MARKETING MIX OF BIG BAZAAR

Product: Big Bazaar offers a wide range of products which range from apparels, food, farm products, furniture, child care, toys, etc of various brands like Levis, Allen Solly, Pepsi, Coca- Cola, HUL, ITC, P&G, LG, Samsung, Nokia, HP etc. Big Bazaar also promotes a number of in house brands like:

DJ & C Tasty Treat Clean Mate Sensei Care Mate Koryo and 44 other brands. Pricing: The pricing objective at Big Bazaar is to get Maximum Market Share. Pricing at Big Bazaar is based on the following techniques:

Value Pricing (EDLP Every Day Low pricing): Big Bazaar promises consumers the lowest available price without coupon clipping, waiting for discount promotions, or comparison shopping. Promotional Pricing: Big Bazaar offers financing at low interest rate. The concept of psychological discounting (Rs. 99, Rs. 49, etc.) is also used to attract customers. Big Bazaar also caters on Special Event Pricing (Close to Diwali, Gudi Padva, and Durga Pooja). Differentiated Pricing: Differentiated pricing i.e. difference in rate based on peak and non-peak hours or days of shopping is also a pricing technique used in Indian retail, which is aggressively used by Big Bazaar. e.g. Wednesday Bazaar Bundling: It refers to selling combo-packs and offering discount to customers. The combo-packs add value to customer and lead to increased sales. Big Bazaar lays a lot of importance on bundling. e.g. 3 Good Day family packs at Rs 60(Price of 1 pack = Rs 22) 5kg oil + 5kg rice + 5kg sugar for Rs 599 Place: The Big Bazaar stores are operational across three formats hypermarkets spread over 40,000-45,000 sq ft, the Express format over 15,000-20,000 sq ft and the Super Centers set up over 1 lakh sq ft. Currently Big Bazaar operates in over 34 cities and towns across India with 116 stores. Apart from the Metros these stores are also doing well in the tier II cities. These stores are normally located in high traffic areas. Big Bazaar aims at starting stores in developing areas to take an early advantage before the real estate value booms. Mr. Biyani is planning to invest around Rs 350 crore over the next one year expansion of Big Bazaar. In order to gain a competitive advantage Big

Bazaar has also launched a website www.futurebazaar.com, which helps customers to orders products online which will be delivered to their doorstep. This helps in saving a lot of time of its customers. Promotion: The various promotion schemes used at Big Bazaar include: Saal ke sabse saste 3 din Hafte ka sabse sasta din Wednesday bazaar Exchange Offers Junk swap offer Future card(3% discount) Shakti card Advertisement (print ad, TV ad, radio) Brand endorsement by M.S Dhoni and Asin Big Bazaar has come up with 3 catchy lines written on hoardings taking on biggies like Westside, Shoppers stop and Lifestyle. They are: Keep West- aSide. Make a smart choice! Shoppers! Stop. Make a smart choice! Change your Lifestyle. Make a smart choice! People: Well trained staff at stores to help people with their purchases Employ close to 10,000 people and employ around 500 more per month. Well-dressed staff improves the overall appearance of store. Use scenario planning as a tool for quick decision making multiple counters for payment, staff at store to keep baggage and security guards at every gate, makes for a customer-friendly atmosphere. Process: Big Bazaar places a lot of importance on the process right from the purchase to the delivery of goods. When customers enter the stores they can add the products they which to purchase in their trolley from the racks. There are multiple counters where bill can be generated for purchases made. Big Bazaar also provides delivery of products over purchases of Rs. 1000. Physical Evidence: Products in Big Bazaar are properly stacked in appropriate racks. There are different departments in the store which display similar kind of products. Throughout the store there are boards/written displays put up which help in identifying the location of a

product. Moreover boards are put up above the products which give information about the products, its price and offers. Big Bazaar stores are normally U shapedand well planned & designed
MARKETING MIX FOR SERVICE MARKETING:

The service marketing mix is also known as an extended marketing mix and is an integral part of a service blueprint design. The service marketing mix consists of 7 Ps as compared to the 4 Ps of a product marketing mix. Simply said, the service marketing mix assumes the service as a product itself. However it adds 3 more Ps which are required for optimum service delivery.

The product marketing mix consists of the 4 Ps which are Product, Pricing, Promotions and Placement. These are discussed in my article on product marketing mix the 4 Ps. The extended service marketing mix places 3 further Ps which include People, Process and Physical evidence. All of these factors are necessary for optimum service delivery. Let us discuss the same in further detail. Product The product in service marketing mix is intangible in nature. Like physical products such as a soap or a detergent, service products cannot be measured. Tourism industry or the education industry can be an excellent example. At the same time service products are heterogenous, perishable and cannot beowned. The service product thus has to be designed with care. Generally service blue printing is done to define the service product. For example a restaurant blue print will be prepared before establishing a restaurant business. This service blue print defines exactly how the product (in this case the restaurant) is going to be. Place - Place in case of services determine where is the service product going to be located. The best place to open up a petrol pump is on the highway or in the city. A place where there is minimum traffic is a wrong location to start a petrol pump. Similarly a

software company will be better placed in a business hub with a lot of companies nearby rather than being placed in a town or rural area. Promotion Promotions have become a critical factor in the service marketing mix. Services are easy to be duplicated and hence it is generally the brand which sets a service apart from its counterpart. You will find a lot of banks and telecom companies promoting themselves rigorously. Why is that? It is because competition in this service sector is generally high and promotions is necessary to survive. Thus banks, IT companies, and dotcoms place themselves above the rest by advertising or promotions. Pricing Pricing in case of services is rather more difficult than in case of products. If you were a restaurant owner, you can price people only for the food you are serving. But then who will pay for the nice ambience you have built up for your customers? Who will pay for the band you have for music? Thus these elements have to be taken into consideration while costing. Generally service pricing involves taking into consideration labor, material cost and overhead costs. By adding a profit mark up you get your final service pricing. You can also read about pricing strategies. Here on we start towards the extended service marketing mix. People People is one of the elements of service marketing mix. People define a service. If you have an IT company, your software engineers define you. If you have a restaurant, your chef and service staff defines you. If you are into banking, employees in your branch and their behavior towards customers defines you. In case of service marketing, people can make or break an organization. Thus many companies nowadays are involved into specially getting their staff trained in interpersonal skills and customer service with a focus towards customer satisfaction. In fact many companies have to undergo accreditation to show that their staff is better than the rest. Definitely a USP in case of services. Process Service process is the way in which a service is delivered to the end customer. Lets take the example of two very good companies Mcdonalds and Fedex. Both the companies thrive on their quick service and the reason they can do that is their confidence on their processes. On top of it, the demand of these services is such that they have to deliver optimally without a loss in quality. Thus the process of a service company in delivering its product is of utmost importance. It is also a critical component in the service blueprint, wherein before establishing the service, the company defines exactly what should be the process of the service product reaching the end customer. Physical Evidence The last element in the service marketing mix is a very important element. As said before, services are intangible in nature. However, to create a better

customer experience tangible elements are also delivered with the service. Take an example of a restaurant which has only chairs and tables and good food, or a restaurant which has ambient lighting, nice music along with good seating arrangement and this also serves good food. Which one will you prefer? The one with the nice ambience. Thats physical evidence. Several times, physical evidence is used as a differentiator in service marketing. Imagine a private hospital and a government hospital. A private hospital will have plush offices and well dressed staff. Same cannot be said for a government hospital. Thus physical evidence acts as a differentiator. This is the service marketing mix (7p) which is also known as the extended marketing mix.