The grand finale of the East India Retail Summit 2013 saw some of the erudite developers and retailers take up the stage for a brainstorming session.
The panel comprised Abhijeet Das, Director East, Cushman & Wakefield; Shitanshu Jhunjhunwala, Director, Turtle; Dheeraj Dogra, Director Chief Marketing Officer, Shristi Corporation; Satyen Sanghvi, Director, Merlin Projects; Suman Barman Roy, CEO, Khadims; Sanjeev Mehra, CESC Properties; S Pani, GKB; Pururaj Dutt, VP Realty Division, Paharpur Cooling Towers Ltd.; Arun Biyani,Owner, Mobel; and Mohit Tikmany, CEO, Kool Kidz.
Das moderated the session and said that over the last 10 years the industry has made huge developments. At present, developers have understood what retailers want and vice-versa. He then put forward a question to the panel that what is it that developers expect out of retailers. Mehra replied that being a part of the retail fraternity he very well understands what each retailer goes through. Each of them has to be successful in a mall and to achieve that it is very important to have dialogue and understanding between the retailers and the developers. It is important for the retailers to understand where they stand and not just think about growth. Retailers have to be honest with what their projections are.
Satyen also shared his thoughts and stated that every retailer has to understand that the whole mall cannot be developed on the ground floor. Other floors of the mall are also of equal importance. Zoning is very important in the mall and giving a customer a good experience is of prime importance, mentioned Satyen.
Dutt mentioned that they are one of the newest players in the mall construction business and their mall is still under construction. They are going through a process of discussion with the retailers and it has to be a joint effort and transparency is needed in the whole process. Das then put a thought forward that revenue sharing should be a win-win case for both the developers and the retailers. With that Biyani commented that revenue sharing mode will survive in the future as the dynamic changes in economy plays havoc with the fixed rentals format.
Tikmani also participated actively in the session and said that taking partnership to the next level is very important in the current time. Revenue shared is definitely the future but both the parties should have banking on each other. He also mentioned that mall owner is responsible to make the retail outlets perform and the interaction level between the retailers and the developers has to be with an open mind.
Dogra said that retailers should feel the pulse of the customers in the catchment area and only then enter the mall. Barman spoke about the time when he started his business by saying that he first opened his store in the high street. Just five to six years back they came into a mall.Thus choosing the right store location is of prime importance. Malls do create a high street character in an enclosed place but proper zoning is very important in a mall. He admitted that he does not have to open his store at the ground floor only but will be happy to get a position in the store with a very good visibility to the customers such as the store position just after the escalators.
Jhunjhunwala said that mainly ground floor shops are sold to the investors and then the zoning of the mall goes hay wire. According to him, it all boils down to what experience can be provided to the customers. He mentioned that he would prefer to be in the men’s zone for his brand Turtle rather than being on the ground floor in a completely different zone.
According to Pani, there are three things one needs to have to be successful irrespective of being present on any floor in a mall, i.e., location, visibility, and customer footfall.
Speaking about the revenue sharing concept Mehra said that it will be a match between minimum guarantee model and revenue sharing model. He said the toughest part would be the marketing. Mehra mentioned the fact that all the luxury brands which are now coming to Quest mall, Kolkata haven’t opened their stores yet but they have started their marketing activities and they are constantly hunting for new marketing opportunities, whereas the stores which have opened haven’t yet started their marketing campaigns.
Das then threw a question to the panel as to why is there a fascination among the developers for international brands in East India whereas the local brands are neglected. Replying to it, Biyani said that they do support local retailers and some of the local players have already become national players. What the local brands have to learn is to create experience, focus on the presentation, and get their supply chain correct as per the customers demand.
Mehra said we have to know who are we making the mall for. In his opinion, retailing is all about aspiration. He said that Kolkata is one of the cities which has recorded one of the highest footfalls in the malls because of the dense population. Malls have become a hang out place for the customers. It is very important to make the customers comfortable and equal opportunities must be given to everyone to enjoy the mall. “We have to come up with quality retail spaces having a good environment in Kolkata,” stated Mehra.
The next question which Das asked was that in Kolkata within 6kms there are 3 malls, so for a customer what is the difference between the three. Answering that Roy mentioned that malls are extensions of high streets and the next catchment area would be Garia and Baraasaat. “There is no clash between the Garihat Market & New Market; likewise South City mall will never clash with City Center,” he added. Mehra also shared his thoughts saying that we have to understand how much people are willing to travel in the city. Sanghvi then confirmed that they have tied up with an international multiplex chain Cinepolis for their mall Acropolis to bring a difference. Tikmani spoke from the consumer’s point of view and added that consumers want their essentials at their nearest location but they may visit a mall situated at a distance because he may have an emotional connection with that mall.
Amitabh Taneja, Chief Convenor, IRF, put up a last question to the panel that what is that one idea which we can think of to double walk-ins and conversions in a mall. The panelists came up with various interesting responses. Dogra was the first one to come up with an idea saying that lease terms need to be made flexible. Jhunjhunwala was of the opinion that walk-ins are not an issue in a city like Kolkata. The bigger challenge is conversion. Retailers can collaborate with the developers and offer schemes along with mega schemes of the mall. Biyani said he is planning a radio campaign in other cities and also bringing in more schemes, like loyalty program for a mall, for people to keep coming back. Sanghvi said that apart from malls being maintained retailers have to do their own homework to keep their business in good shape. Tikmani opined that they have to come up with ideas to connect emotionally with the customers and also create zones for the local brands as they have their own loyal customers. Pani commented that a good environment has to be created and high cost of parking has to be re-thought upon. According to Roy, there is no easy way out and no magic formula. Hard work has to be put in with more focus. Dutt came up with an innovative idea that a mall can celebrate a week of menswear, womenswear, footwear, etc. Biyani suggested the concept of Night Bazaar where stores would be open till late night so that more customers can be attracted.
Das concluded the discussion by saying that the panel couldn’t come up with a specific idea but gave generic ideas about what retailers and the developers can do. Also both the developers and the retailers agreed that revenue sharing is the next model to be followed along with a judicial use of money guarantee model. He said that one thing evident from the discussion was that ground floors seem to have lost their charm. The panel came up with great ideas and suggested the retail fraternity to come together to sizzle up the business.
An interesting debate then took place between the audience and the panel members.