Dynamic lifestyle, growing brand-consciousness and a strong desire to embrace the West while sticking to an indigenous culture; these are but a few elements capturing the essence of the Indian consumer. Hardly surprisingly, many conglomerates are pampering her with new or established foreign brands – and offering products that are contemporary and yet ethnic in terms of their design, colour or utility. CEO of Amanté, MAS Retail Brand in India, Venkatesh Rajamani discusses consumer behaviour vis-à-vis retail in India.
Rajamani brings with him a wealth of Indian and international experience. In his last assignment as general manager with Spencer’s Retail, Chennai, Rajamani spearheaded business strategy and performance by providing leadership through increase in trading areas, template profitability and consolidating operations and merchandising functions. He has also held senior positions at Planet Sports, Shoppers Stop, Subhiksha and Indian Terrain to name a few. He also has several years of experience in Retail in the Middle East.
Retail from the days of mom and pop store has emerged into various retail formats. Different formats of retail are still emerging across categories. Retail is by far a necessary evolution. It helps the consumer to understand how and what products to pick up. Modern retail has given the consumer the choice to pick and choose, a luxury absent in thecase of counter stores. Retail today is also about touch and feel. Today, retail is about bringing convenience and freedom to consumers. All these factors bring conversion at the store level.
With this constant retail boom, a simultaneous consolidation is bound to happen. The financial meltdown has only caused a moderate slowdown in retail. No influence has really been observed on the propensity of the consumer to buy. He or she still continues as before, albeit with a cautious dent in total expenditure. Retail boom in India is credited more to domestic consumers and it is not export driven. Internal consumption of India is very strong, compared to China which depends largely on exports, which has the potential danger of turning into a threat. 60 per cent of retail sales in India catering to the domestic market, in fact acts as a shield to the Indian retailer at large.
Because of the slowdown today, retail and real estate people have started to believe that if one of them has to win, it cannot be at the cost of the other.
What we term as retail slowdown is actually a moderate slowdown. The consumption is still happening. Unlike the US where people are not buying, fundamentals in India are strong enough to keep driving consumers to stores. The Indian consumer today, even if he has a Rs 100, is still spending but with a thought to ‘how best can I spend?’.
I welcome what is happening today to retail in India. It has brought a lot of discipline into the industry. Because of the slowdown today, retail and real estate people have started to believe that if one of them has to win, it cannot be at the cost of the other. Hence the slowdown has brought about a win-win scenario for both.
Spencer’s to Subhiksha to Amante now. The similarity
Subhiksha & Specner’s both are into food retail, however Amante is not retail, it is more of building a brand. Amante is actually surrogate retail. At Amante, we believe in being first a brand owner and then a retailer.
Concept wise, Subhiksha is brilliant. I think they failed in execution. They expanded disproportionately. At Subhiksha they over-did things without understanding the basic fundamentals. Result: they got into multiple crisises, not just one.
Unlike outerwear, intimate wear market in India is a sunrise industry. The potential of the segment is lucrative enough to lure many foreign players who are entering India. The biggest advantage of the intimate wear industry is that it’s a technically complex business to run. The winner in this category can only be someone who has got the entire supply chain backward integrated.