Malls are mushrooming all over india and they all depend on customer footfalls for survival, says Harminder Sahni, MD, Wazir Advisors. Why then do most of them insist on fleecing customers and humiliating them in an atmosphere of monopolistic exploitation?
Every single time I visit a mall in India, I am simply amazed at the audacity of mall managers to increase parking charges for visitors’ vehicles. It is ridiculous to note that the charges during weekends are almost double those charged from mall customers during the weekdays. (It is not that the charges during weekdays are insignificant either!) I really do not understand what mall managers are trying to achieve by fleecing consumers who have no choice but to shop over the weekends and park their vehicles at the malls. We are all well-aware of the terrible shortage of parking spaces in our cities.
Monopolistic Exploitation
This practice is nothing but monopolistic exploitation at its worst. If some mall manager’s logic is that they are trying to woo consumers to shop during weekdays by offering lower parking charges, I am not willing to buy it. I do not think any consumer will decide her shopping trip based on the level of parking charges. It seems to me that the mall managers are applying this same logic to charge from customers as much as they can get away with, because they know that consumers would not mind paying relatively small amounts of money, even if the charges are unreasonable. But the point here is not the money but the mall managers’ attitude towards consumers who are actually the very reason why the malls exist and who pay for everything at the mall, including mall management’s salaries.
I am quite certain that mall mangers will have a sufficient justification for charging extra parking fee from mall visitors, but I do not think even they can justify increasing these charges every few months. Does the cost of parking, which is basically a fixed asset, increase so often? Is there some serious running cost that goes into managing a parking lot that rises so often? What happens to the parking lot during the weekend to justify higher parking charges?
A parking lot has a certain space for vehicles and any mall manager would be happy to see it packed to capacity all the time. If it fills up during weekends, that is an excellent situation for the mall – why thencharge a premium on parking tickets? Are the mall managers trying to dissuade consumers from coming tothe mall over the weekends? I really do not get it despite trying my best.
Humiliation and Fleecing
The humiliation and fleecing of visitors does not end at the parking lot but goes inside the mall right up to the stores. Once you are at a store, or – let me say – most of the stores, the security guard pounces on you to collect your bags as if each one of us walks around the mall with an intention to shoplift. We are supposed to trust the security guards with all the shopping done so far and collect a plastic token as receipt. How are we supposed to know nothing will be stolen from our bags by the guards? And if something is missing, how would we prove that the object was actually in the bag when we deposited it with the security?
It is amazing we do not see disputes around this at stores all the time. For this, I will give credit to the general honesty of most Indians and their trusting nature. But are the retailers and their managers not Indians? Why do they find it so difficult to trust their customers to move around the store with a bag? Once the CEO of a large retail chain in the US came visiting and asked me why do Indian retailers follow this practice. I said I did not know what the real intent of mall managers was behind this. However, I personally do not mind depositing my bags with the store security as it leaves my hands free for shopping. Won’t it be nice if retailers offered this as an extra service to customers instead of forcing it on them and making them look like suspects?
After depositing your bags and passing the scrutiny of security guards, you walk inside the store, touching and feeling the merchandise. But God help you if you drop something or break it! I am not sure how most retailers deal with such a situation, but I was witness to a really bad incident at one of the oldest and most respected retailers that takes pride in its ethics and services.
Watch What You Drop
A customer dropped a small metal item in the store which unfortunately fell on a set of six mugs that was displayed precariously on an open shelf. One of the mugs broke but the other five were undamaged. There was a moment’s silence before anyone could react. The customer seemed to be feeling sorry and looked around for some reaction. The female store manager, who was nearby, rushed to the spot and inspected the damage. Without as much as looking at the customer, she ordered a sales person to prepare a bill for the entire set. The customer was aghast and so was I. He asked the manager: “Who are you billing it to?” She matter-of-factly replied: “Of course to you.”
Now the customer was livid and insisted he won’t pay for the entire set as the store was offering the same mugs in singles too. Why couldn’t he pay for just the mug that was broken? But the lady was adamant and insisted he pay Rs 1,000 for the set and take it with him. I realised all this was going on while that same customer was waiting for his shopping of over Rs 20,000 to be packed. He said he will pay for the damaged set but would like to cancel his other shopping. The manager shrugged and ordered his salesman to do what the customer just said and asked him to make sure the customer paid Rs 1,000 for the damaged set.
I was shocked and stepped in to talk to the manager about why was she being so unreasonable. She said the billing system does not allow her to charge for part of the set that has been bar coded as a full set. She obviously knew her company better and did not want to risk any repercussions by letting go of this damage without a full charge to customer. I could not argue with that.
My conclusion from this: the retailers not only don’t trust customers with their shopping bags, they don’t trust their managers either to take independent calls to avoid such ugly situations.
I see these kind of things happening uniformly across most of the malls and stores in the country and thus would refrain from naming any of them. But I am also certain there would also be a few malls and retailers which may not be indulging in such practices. I would urge them to share there stories with the industry so that other players can also learn that respecting consumers, offering services that encourage them to visit more often, and empowering store managers to delight customers make for good business sense. It all pays for itself many time over than petty parking charges and few unintended breakages by customers.
*This column was originally published in April 2012 issue of Images Retail.
