Branding Supermarket

Organized retail, since it’s inception in India has been a matter of big discussion about
it’s size, it’s scope, it’s future and moreover it’s impact on pop and mom kirana stores
and farmers, for whom, this is livelihood. Organized retail, with the entry of big national
as well as international players has crossed many milestones in last 3-4 years, with the
number of outlets, it’s penetration, volume of business generated not only for
themselves but for their vendors and number of employment created. But other than the
word “Organized Retail” and name of our (I am the part of this fraternity) famous
promoters, has any of us been able to create an identity, other than discounted prices,
which we offer to our consumers. Once I was in discussion with one of my friend from
rival retail organization regarding our achievements and we both were busy blowing own
trumpet, but very soon we got the point that we are doing everything similar in
completely similar way and doing so is the kirana store next to my housing society
without doing any so called extraordinary promotion, otherwise, he would have closed
down long back.

Although there can’t be uniqueness in any strategy for a long time, because if a strategy
is not copied or being tried to be ecopied then it’s not a successful strategy, but
organized retailers need to create an brand identity based on the value proposition it
offers and consumer shopping experience. Being part of this industry for very long, I can
say that this is easier said than done. A normal convenience store is opened in the
catchment of around 4000 households based on certain cost calculations and expected
revenue. This number is significant not only for achieving the desired top line and
margins but for satisfying and retaining also, otherwise our main objective to make this
business proposition viable can’t be achieved. Consumers are king and they have proved
this thing by not going to many stores opened by big organized retailers leading them to
close it down. At the same time consumers has also patronised certain stores, which has
benefitted from all the effort they have put in. If you ask any common person in Mumbai,
they will take the name of D Mart as their favourite place for monthly shopping, some
has given their heart to Sahakari Bhandar and habitats of Mulund prefer Shoprite. If you
go to Pune, then there is a loyal fan base of Grahak Peth. What extra these stores do;
may be the following:

1) Understanding the catchment and bringing in right merchandise

assortment: Peanuts features occasionally in the food habit of northern part of
India, from where I belong, but I applied this understanding when I was part of
Reliance Retail, Rest of Maharashtra team, where “poha” is the everyday morning
staple diet and peanut is the key ingredient. Result was disastrous and I corrected
my mistake without wasting any time. Selling refrigerator to an Eskimo may look
like a heroic job but it’s not right because they may buy once but will not need it.
So, it is imperative to make mass customization of assortment and make it
suitable for the catchment. Consumers may be tempted once or twice for an
aggressive pricing but will not compromise on the availability of their
requirement.

2) Product Availability: With my experience, I can easily say that consumer may
go to a store once or twice for pricing but ultimately she likes to shop in place
where she gets her entire monthly shopping basket. I have seen many consumers
leaving trolley full of products in the case of not getting even smallest of thing,
whose buying they can postpone. Product availability is a convenience factor for
 them and that’s why they come any supermarket, otherwise they would have
gone to any normal kirana store. So far, I don’t think any organized retailer has
reached to that mark.

3) Pricing:- Approximately two years ago, I was invited by my ex-colleague to join

them in their new retail venture in Punjab, started by a big rice trading firm. To
dissuade my doubts, he took me to the visit of stores they had opened and
proudly told me that they are selling “Methi” at Rs.2/- Kg against the price of
Rs.12/- for the same being charged by vegetable vendor opposite the road. Like
anybody would have done, I also asked for the logic behind it and tried to know
that whether they have struck the treasure chest somewhere and answer I got
from him was, “I want to kill competition”. I got frightened and literally run away
from that place, without giving a second thought of their good offer to me and my
friendship. That might be sounding very macho for him that time but the final
outcome was obvious, you can’t run business at loss. Vegetable vendor is still
there, the retail chain is out of business now in across country. Here the question
is , “whether consumer really asked for this type of pricing”? If it would have been
so, then they might have been directly banging factory’s doors, which is definitely
not the case. Consumer is ready to pay for the quality, although quality is very
relative term and it changes according to their buying prowess. That’s where the
merchandiser’s mass customization and pricing skill comes to display. According
to the need of the catchment, merchandiser needs to create different price points
in the store, with every price point catering a segment of consumer. Also to be
taken care is the fact that there should not be big gap between two price points to
make graduating to next price point difficult for the consumer. This makes
consumer feel welcome in the store with her present buying capacity as well with
her aspirations to upgrade to next social level. Furthermore, the pricing has to be
consistent. In food retailing, price fluctuation is inherent and can’t be done away,
but the inconsistent pricing not matching with market gives a wrong
communication to the consumers. It has to be noted here that only pricing can’t
be the differentiator in the market.

4) In-store Execution: In store execution can be discussed in different parts.

4-a) In-store display: Store is the face of entire retailing organization. Consumer
does not see and neither they are interested to see that what you are going
through to put up what they want. There have been different philosophies of in-
store displays, some favouring rural bazaar type display and some going with
neatly arranged planogram. Whatever should be the display philosophy,
eventually it should lead to comfort for consumer in finding her requirement
inside the store. She is obviously not there to solve the jigsaw puzzle or play
Sherlock Holmes to locate her stuff. Unfortunately, this is the case everywhere
and the store staffs also come with the little help. They might be having their own
reason, but what matters is attention to be given to the consumer in such a way
that it should not unnerve her and at the same time it should not leave entirely of
her own in the store. Proper signage is definitely needed to guide the consumers
towards different categories.

4-b) In-store Price Communication: Another important point in-store price

communication. Almost all the organized food retailer follows different pricing
strategy for different product. They sell some of the items on the maximum retail
price printed on it and sell some on far below MRP. Pricing strategy and prices
changes in the corporate and zonal office and so in the system, but
 communication of the same goes missing at the store floor, where it is equally
required. It adds the confusion and deters consumers from taking the buying
decision. Indian consumers are normally of shy nature, who likes to shop in crowd,
so that nobody recognizes her/his buying capacity and at the same time aspires
to upgrade her buying to the next price point. A proper pricing communication
gives this confidence her confidence to be of her own, a freedom from
dependency.

4-c) Staff Knowledge and Etiquettes: Very important point is knowledge of the
staff about the product they are selling. As we discussed in the point no:3 and 4-b
about the importance of pricing and price communication, every consumer comes
to the store for product at certain price point according to her budget and at the
same time she also aspires to graduate to next price point. But before doing so,
she wants to doubly sure that the quality and features of the product which she is
aspiring to buy with hard earned family money is doing justice with the price or
not, and this role of convincing her is completely on shoulders of store staffs. So,
it is very imperative for the Category Managers to train the store staffs about the
features, benefit and value proposition of any product. It will help them to engage
consumer in conversation and convince them. Similarly, the staffs should be polite
and warm to the consumers. It sometimes becomes difficult when consumer
becomes abusive and offensive, but they have to handle it tactfully. Retail is 24 X
7 job and when entire world enjoys holiday, retail staffs are standing in the store
to welcome shoppers. Continuously standing in the store for hours, and in the
case of food retailing, unloading the vehicle, taking the stock to the store floor,
unbagging and placing it in the shelves tires them a lot. So, Store Managers need
to rotate the duties address the physical work issue of store staff. Management
also needs to

4-d) Queue at Cash Till: Even I also agree that this is the most painful part of
the shopping experience, standing in the queue and waiting for your turn. This
problem is a bit more in food retailing part, where there is quite a possibility of
one product’s different unit having different MRP. At the POS level, cashier finds it
very difficult to pick the correct MRP quickly, because once he scans a product
many MRP gets flashed on the POS machine. So, internally supply chain as well as
store staff are required to maintain FEFO(First Expiry First Out), Category
Managers and IT team are required to keep only those MRPs in the system, whose
stock is available. Anyways, retailers are using this time to push the sales as well
by keeping impulse items like chocolates near the Cash Till.

5) Private Label: Almost all the big retail organization in India are run by big
industrial houses and these industrial houses far more bigger than the Indian arm
of FMCG giants and their name is famous in remotest part of India. It’s good that
these stores are selling different branded products from their stores, but doing so
are the local kirana stores. Putting it in the different way, if a consumer wants to
buy a Close up toothpaste, she can go to either local kirana or a supermarket, but
if she wants to buy a AU79 range of men’s grooming products, she will have to
come to more. Supermarkets or Healthy Life range of food products, then she will
have to go to Reliance Fresh only. To pull consumers towards private label, there
has to be sustained effort from everyone from the organization, because it’s
quality, features and quality proposition will bring in more footfalls and work as
differentiating point between kirana and organized retail. This will not only work
as differentiator but also help in improving financial health of the company.
Private label is the biggest brand builder for the retailer. Once the product gets a
 place in consumers mind, then she will automatically remember the place where
she has to go to get it.

6) Home Delivery: Yes, this is one topic which is widely being followed and
important tool to win consumer’s loyalty, only glitch here is the timelines. Retailer
has to ensure that product purchased by the consumer is delivered at the time
agreed.

7) Loyalty Benefits- We become friends or get into a relationship with somebody

purely on the basis of what we are getting in return. Consideration may be
different for everybody, emotional, physical, financial etc. A consumer can go
anywhere to shop their monthly requirement. If she is coming to particular store
continuously, the she needs to recognized and rewarded for that. The reward may
be in any form but needs to be measured in terms of money and social status.

8) Feedback, Evaluation and implementation: Since retail is about direct

dealing with the consumers, their feedback needs to instantly recognized,
evaluated and addressed. Why I am writing so, because every successful
supermarket gets between 500-1000 footfalls everyday and every consumer is
entitled to have their own opinion on certain things. Once their opinion is
recognized and evaluated from the business perspective, it has to be
implemented without delay and the consumer should be informed about the
progress. It will make her/him feel important person for the organization.

While taking the relieving letter from one of my previous organization, I met my
Reviewing Officer (boss of my boss) that I have put so much of effort in the location,
where nobody wanted to go and I gave better business than anybody else in that
segment, met more people, out placed competition, created a brand for the company,
but I was not duly recognized and rewarded. My Reviewing Officer wished me luck for the
future but cautioned me for not being good salesmen for myself. He said, “You made
company’s voice audible in outside market and did excellent job, but at the same time
you did not made your voice audible to the decision makers for your career growth. In
any dynamic organization or market, you will have to make your voice heard, otherwise
everybody has got different priorities.”

All the good work a retailer is doing has to be communicated to all the stakeholder,
communication medium may be discussed later. It will create an identity of the retailer
based on certain qualities, which will create a better shopping environment for the
consumers, and result in loyalty from their side. Branding will never be one time exercise
of creating a logo or picture, it is relentless exercise to provide consumers what has been
promised to them continuously, without fail. If you are caught winking, then somebody
will replace you. As I said earlier that a strategy is good strategy when either it is copied
or tried to copy or if none of two has happened, then it’s not a strategy at all. So, your
strategy may be copied, but remember you may be the first one to do it. Everybody
remembers “Edmond Hillary” and “Tensing Serpa”, because they were the first one to
climb Mount Everest. After them many more has achieved these feet, but how many of
us know. You will always have first movers’ advantage.