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Kiosks in Shopping Malls: Big revenue opportunity for small businesses

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E-commerce giant Amazon has been toying with the idea of installing kiosks in malls in India for some time now. Their tryst with the idea began two years ago with the setting up of kiosks in malls in Bengaluru. Today, they operate five kiosks in Mumbai, Noida and Ahmedabad. These kiosks offer customers the experience of using Amazon devices including Kindle, Echo and Fire TV before they buy them. The very fact that recently they went ahead to announce the roll out of 100 new kiosks in malls across the country speaks volumes on the potential they see in this format. Whether or not this can be considered as a prelude to their aim of setting up of brick-and-mortar stores in India remains to be seen, but the mere fact that Amazon is taking the business of kiosks seriously signals an opportunity for budding entrepreneurs to enter this space. In India, the most common categories for kiosks include food, cosmetics and accessories though malls today are experimenting with niche kiosk offerings like tattoos, quick hair-cuts and astrologers.

A Quick Run-Down from Malls

One of the most prominent names in malls in the west is . Inorbit houses around 40-45 kiosks in each of their locations i.e. Malad, Vashi, Bangalore, Hyderabad and Vadodara with a lease agreement extending to a period of 11 months.

According to Naviin Ibhrampurkar – Marketing Head, Inorbit Malls, the kiosk formats for them has been working “really” well especially in the food and beverages segment. “Recently, the format has gained popularity among categories like accessories, cosmetics, nail services and tattoo art too,” he states.

Brands like Colorbar, which retail through EBOs as well as MBOs in department stores like Lifestyle, are big fans of the kiosk format, proving Ibhrampurkar’s statement of the format attracting cosmetic brands.

Recently launched brand, , too has made its presence felt through kiosks at malls in India.

At management of kiosks is taken care of by the mall marketing team as well as the leasing team. While the marketing team leases kiosks to brands for a period of 1 to 11 months, the kiosks agreements signed in by the leasing team are a part of a larger leasing strategy that extend beyond 11 months.

, Mall Head DLF Promenade, says, “We host 9 temporary and 17 permanent kiosks in-mall. Typically, food and beverage and accessories are the categories that perform well in comparison to apparel and other kiosks. We have had TIBBS Frankie for the last 3 years, for the last 1 ½ years and – these are some of the names that are doing well in terms of sales and footfalls. Besides these categories, we continue to experiment with other categories such as bookstalls and stationery kiosks.”

Mumbai’s Viviana Mall leads the number game when it comes to the number of kiosks in a single mall with a total of 58 kiosks and all running successfully. They too offer an 11-month lease agreement to their brands/ retailers.

Manoj K Agarwal, Chief Executive Officer, Viviana Mall states, “In present times, there has been a mushrooming of kiosks in malls across various categories. At Viviana Mall, along with our premium brands, we have a range of kiosks to appeal to our guests. One can find confectionary brands, fast food joints, jewellery, phone accessories, fashion and apparel, among others. Additionally, we also offer footwear, bags, toys and various services like key maker, shoe laundry, car wash, bike wash and a plant nursery under our wide gamut of kiosks. All of these have received a tremendous response from visitors.”

Kalyan may sound like an offbeat location for anyone living in Mumbai but surprisingly has managed to changed the retail landscape of this place. According to , Director Retail & Business Development, Metro Junction Mall, they have 36 kiosks at its location, all of which have a lease agreement of 11 months. “Food and games do well when it comes to kiosks,” she says.

At Mumbai’s Oberoi Mall, all kiosks are currently dedicated to the category of desserts. Anuj Arora, General Manager, Oberoi Mall shares, “Oberoi Mall at Goregaon in Mumbai has about six kiosks dedicated to the ‘desserts’ category in its Food Court. Typically, all such arrangements are for twelve months which gets renewed mutually. This gives us the flexibility to bring in the latest trend in desserts and stay relevant amongst our patrons.”

On what makes the mall specialise in kiosks that offer desserts, Arora explains: “Food and beverage kiosks tend to do extremely well as they mostly offer seasonal delicacies and customise their menu base on demand. Therefore, we have consciously created a chain of kiosks dedicated to desserts.”

, Chief Executive Officer, Infiniti Mall shares, “Our Andheri branch has 17 kiosks and Infiniti Mall in Malad has 35 kiosks. Unlike other malls, here the lease agreement runs for a minimum of three years.”

On the categories that are apt for this format, he says, “Kiosks are often best suited for impulse purchases. These are generally products or services that visitors would not take special trips for and thus it is important that kiosks have an instant and uncomplicated aesthetic value, quick and seamless transactions, and smaller variety of products with minimal price points. Hence, gifting items, stationary, novelty accessories, food and beverages attract a significant clientele when it comes to kiosks.”

in Kolkata too has close to 18 kiosks with a lease agreement of 11 months. Sanjeeev Mehra, Vice President, Quest Properties India Ltd. states that kiosks have their own USP and these usually “are in your face”. “Their USP is that they are small ticket items which are purchased on impulse. What best we can do is to position them at the right spot,” he explains.

Factors That Drive the Kiosk Format

Besides the attractive kiosk designs that allure the shoppers, there are a host of other factors too that drive footfalls to them. Every mall which brings in a kiosk stresses highly on the uniqueness of the product / service being offered by it. The more niche the product / service, the better are its chances of having a successful run at the mall. The other prominent factor would be pricing of the goods being sold/ services being offered.

Ibhrampurkar elaborates: “It is impulse buying and low-price points that draws footfalls to a kiosk. A kiosk can be easily spotted by customers as they are strategically located in the mall aisle spaces. Inorbit also encourages kiosk operators to run offers and participate in mall events to get more brand visibility and better conversions.”

The top three factors that Inorbit takes into consideration before signing on a brand to run a kiosk include – product, pricing and uniqueness of the product. Agarwal reveals the factors put in place at Viviana before signing up on brands to run their kiosks saying,

“Before we sign up with a retailer for a kiosk, we look into factors such as their market demand, brand presence and value addition to the mall. We conduct a detailed research to evaluate and understand the right mix for our customers to identify the potential brands. This has enabled us to creating an elaborate mix of brands that range from an astrologer to kiosks offering high-end tech gadgets, food and beverage, fashion accessories and even a shoe laundry.”

The top factors at that drive the kiosk format at Oberoi Mall include questions like: Would brand offerings be relevant to their patrons? Can the brand do justice in a kiosk format? What are the credentials of the brand? For Infiniti Mall, the most important factor is the price point of the product and category. As for Quest, the top factors taken into consideration before signing in on a brand would be to find out if the brand offers a fresh perspective, is palatable by the consumer and whether it offers mall ticket item or belongs to a category not catered to otherwise by the mall. Metro Junction Mall, meanwhile, looks at the category the kiosk caters to, the uniqueness of the product/ service being offered and the brand identity.

The Technicalities

Each mall has different mandates when it comes to size and design of the kiosks though all of them strive to ensure that the design is in sync with mall aesthetics.

They also look for kiosks which are able to stand independently as well as attract footfalls without blocking any stores in the foreground or background.

At Inorbit, the usual size of a kiosk runs in between 8ft x 8ft which is manned by not more than three staff members. This has its pros and cons. The size of the kiosk does not merit for more sales personnel to crowd it but then if the kiosk attracts heavy footfalls, not having enough staff may mean losing customers. At DLF Promenade, the mall has left it to the brands to decide on the number of people it would need to run the kiosk. Natu says, “The manpower of the kiosk is controlled by the brand itself depending on the space available to them.”

Then there is the issue of space availability, which is as important as the uniqueness of the product. According to Ibhrampurkar, the adjacencies play an important role too, for e.g. an accessories kiosk located at the women’s ethnic zone will draw more relevant crowd.

Elaborating on the design parameters in place, he says, “As per mall norms, a kiosk has to be set up within a certain dimension as per the space allotted. Also, the retailer has to share the kiosk design with the mall team for approval. It is important to have a well-designed kiosk that gives enough space for product visibility. The kiosk should also have good lighting.”

The placement principle followed at DLF Promenade is based on the fact that the kiosk only act as an additional option to the shoppers and do not compete with brands inside the mall. Natu states that the placement is decided by the available Floor Area Ration (FAR) which is a fixed area. Also, the nature of the products/brands is taken into consideration while placing a kiosk in the mall.

“Our efforts lie in offering the best space to the kiosks so that they get the most conversions in terms of sale and footfall,” he says, adding, “the size of the kiosk also plays a crucial role since we only have a limited area for FAR and the same space is used by the mall for its promotional events.”

On the size offered to brands for running their kiosks and the manpower mandate, Agarwal says, “Viviana Mall aims to offer kiosks which are compatible and fit a specific desired standard of the establishment. Typically, we offer two standard sizes of kiosks in the mall, one being 10 x 5 and other of 8 x 8. The average height of the kiosks that is decided by the mall is 4ft. Based on the size of the kiosks, we generally permit a minimum of two people in a kiosk. However, the manpower might exceed in to suit the requirements of the business.”

On the design philosophy followed at Viviana, Agarwal adds, “According to the mall policy, there is a standard framework that needs to be followed when brands kiosks are given an entry in the mall. The standard height of the kiosks needs to be 4ft and the all 4 sides of the kiosks need to be visible for customers to be have a full view of all products in the kiosks and also helps to access the them from all 4 sides.”

At Infiniti, kiosks can be of several varying sizes; however, they are mostly between 50 -250 sq ft range. The manpower allowed is subject to the nature of business. Adding on the placement policy in place, Kumar shares, “While the brands have pre-requisites, the ultimate placement is determined based on space availability and the right retail mix. A retail mix typically refers to the plan of category specific space allocation within a mall. For instance, the break-up of space allocated to food and nonfood and within non-food, the amount of space to be allocated to apparel, footwear, jewellery, etc.”

As for the design of the kiosks, at Infiniti the mall policy makes its mandatory for kiosk to have an open format with height not exceeding 7.5 feet. Kumar adds, “The material used for the kiosk should be good quality.”

At Metro Junction Mall, the brands are given 100 sq.ft. of space to build their kiosk with a liberty to have a minimum of 1 to a maximum of two people manning it. Rao talks about the plan of action in place at Metro Junction Mall saying, “We are currently revamping our mall completely and we have engaged Bentel Associates as our architects. They have played a crucial role in determining the kiosk location, size and number. We have categorised kiosks as dry, wet and pop kiosks. These are primarily defined per customer circulation as well as the zoning mix of the mall.” On the design mandate she says, “We have standard kiosk guidelines and each kiosk operator has to mandatorily adhere to these.”

On the size of their dessert kiosks, Arora says, “The kiosk size is generally in the range of 40 to 50 sq. ft. depending on the space requirement by the brand and so is the manpower.” Adding on the placement technicalities, he adds, “All our kiosks are located in the centre of our food court where they cater to our patrons’ sweet cravings. Given the dedicated zone and limited number of kiosks, there is less stickiness to a particular location by any brand. They are all happy to trade from the kiosk which becomes available during a brand churn.”

On the placement policy in place at Quest Malls, Mehra shares that all their kiosks are positioned by category. He further highlights that where brands may have a say on where they wish to have their kiosks, it is important that the fundamentals of retail are understood rather than demanding location. He explains, “Revenue is the most important litmus test. We also keep the mall’s perspective and target audience in mind, to make sure we present the kiosk and the mall in the best way possible to our patrons.”

Mall Support to Kiosks

Where the design of the kiosk and the products it has to offer are what ultimately drive the footfalls, the malls too play an important role in supporting the kiosks to attract the shoppers. To ensure steady footfalls to their kiosk tenants, Agarwal and his team at Viviana extend their full support not only in terms of placement but also various marketing initiatives. Agarwal says, “We strive to ensure our tenants and partner have a fruitful association with us and we go beyond the usual to provide unique solutions to them. While guests do prefer visiting stores, we aid our kiosk partners by providing them with solutions on the placement of the stall depending on their brand offerings. We also help them with conceptualising aesthetically pleasing design ideas. Not just this, but we curate marketing activities for kiosks which enhances their visibility and leads to an increase in customer engagement.”

“In fact, we also curate annual properties enabling kiosks to come up with exclusive offers, resulting in higher customer engagement and sales. ‘Tech Fest’ and ‘Sunglass Fest’ are a couple of such properties which aid brands dealing with respective product categories to reach out and attract more customers to their kiosks. Similarly, we also ensure a healthy participation from kiosks during our flat 50 percent sales,” he adds.

On the support extended to kiosk partners at Infiniti, Kumar shares, “We help them via social media activity and enhance their brand awareness. We also offer branding support to the retailers in the mall premises. Moreover, if the brand expresses their desire to reach out to our loyalty customers database, we help them by sending an e-mailer and SMS blast.”

To attract people to their dessert kiosks, Arora says Oberoi Mall’s kiosk zone has been designed in such a way that it ensures that all the brands get prominence and customer attention. “We ensure that no two kiosks have any dominant overlap in their offerings thereby enhancing the choice universe for our patron to satiate their sweet cravings.”

Graduating to a Store

The business of kiosks for budding entrepreneurs is seen as a stepping stone to further their enterprise into having a full-fledged brick-and-mortar store at the mall. For e.g. at Inorbit, the team witnessed several successful brands like , Go Colors and WOW Momos who started with a kiosk today operating out of a retail store.

Ibhrampurkar says, “Inorbit helps entrepreneurs in creating success stories by helping them establish their brand among other retailers. We have an initiative called Pink Power which offers promising women entrepreneurs free retail space at the mall for a period of 9 months. We not only offer them a space to grow their business but also mentors these entrepreneurs in making right business decisions. The initiative is hosted across Malad, Vashi, Bengaluru, Hyderabad and Vadodara. The campaign is currently in its 5th season and has become one of the most loved initiatives among women. Every year we received close to 500+ unique business ideas.”

Talking about the conversion rates of kiosks to full-fledged brick and mortar stores at DLF Promenade, Natu reveals, “50 percent of our previous kiosk brands have now been converted into stores at DLF Promenade.”

However, Quest’s Mehra does not mince words to point out that not all kiosks can be converted into stores eventually. “It is a science. You may find that when a kiosks turn into stores,they actually fail,” he says.

While this may be true in some cases but going by the way Go Colors and WOW Momos have graduated to running successful stores post initiating their mall journey through kiosks is proof enough that there is success in this format, encouraging niche and budding retailers.

Metro Junction Mall’s Rao talks about how their mall has invariably helped retailers and brands attain the confidence of moving away from kiosks and opting for stores. “The Kalyan- Dombivli-Ulhasnagar region is transforming fast and the customer demands are almost similar to any other mall in a Tier I city. So, our endeavour is to keep introducing premium lifestyle brands and sometimes the kiosk option works very well as brands also taste success and become more confident of opening a store within a mall.

The Path Ahead

Unlike stores, kiosks give brand the chance of a direct and more personal connect with customers. If a sales executive is trained well, s/he can gather valuable feedback from shoppers on the products/ services being offered and this eventually can help the brand to strengthen itself for further growth.

As for the malls, kiosks go a long way in adding a differentiating factor with their niche product offerings. For e.g. Sugar Threads at a few of the malls in New Delhi and at Kurla Market City in Mumbai has garnered a lot of attention with it flavour bursting options for the good old cotton candy. Though pried steeply at a whopping Rs 175 for a single cotton candy, the brand is attracting quite some footfalls on any given day. The lesson here: the customer is open to loosening their purse strings provided they are offered something exciting and unique and this is exactly what kiosks help to achieve.

To conclude with Oberoi Mall’s philosophy on encouraging the business of kiosks, Arora says something that perhaps all mall developers would agree upon, “It is important that anyone with a dream be a part of the great Indian retail revolution and be given a chance to try and succeed. With a goal to grow the entire eco-system we operate in,we welcome all businesses – big and small. The only criterion is that they must appeal to our patrons and be able to enthuse them.”