Elevating the Pantry Shopping Experience

I was at the FoodHall on Linking Road at Mumbai for a recce on behalf of an FMCG Brand that I am working as a Retail Advisor. This was my first visit to the store and I have heard quite a lot about the concept which has been around for over half a decade and with the number of Stores / Store business growing quite well, YoY. The 4 storied outlet spread over 6,000 sq. ft. approximately houses everything that a Food Bazaaar sells, from Grocery to Fresh Vegetables, Oils to Snacks and so on. Except that most Indian Brands do not find a place here. Most Indian “mainline” or mass FMCG Brands, perhaps. And its not just the merchandise that’s different, rather the entire shopping experience. With the assortment of products spread across the four levels, almost NIL promotions or Discounts and a very private shopping experience, I guess the concept has caught up quite well with shoppers. 

I did see atleast 3 Celebrities (Cinema related) in the 2 hours that I spent at the store. They had a private shopper along with them not just to carry a basket or push the trolley, rather to ably assist them in their choice of products to purchase. They seem to be at ease while just being there and of course the entire elevated customer experience which makes the format a hit with the high and mighty. 

Cut to 2002 when I used to run Foodworld Stores as Operations Manager. Even then, my store at RA Puram, would attract quite a bit of celebrities given that this was one of the premium locations in South Chennai. I would personally assist film stars likes Ms. Khushbu Sundar, Ms. Sarika Kamal Hassan, the former CEO of Ford India who would live at the Boat Club Area and the families of the top brass at Hyundai who had chosen this part of town to form small communities of their ilk. The reason for them to shop at an air-conditioned environment (in 2002) was not just convenience but privacy too. However, over the years, the much coveted “Grocery Shopping” has evolved along with Customers. 

Today, the good old Big Bazaar looks shinier than before. The Future Group has created a new vertical in FBB – Fashion at Big Bazaar which has actually evolved from the learnings of the apparel department of Big Bazaar. One would recall the Group sold its jewel-in-the-crown "Pantaloon" business to Aditya Birla Group couple years ago. And now they have built FBB from scratch as well as the upmarket Cover Story which is a dazzling women’s-only store with fast fashion curated from London & beyond. Similarly, FoodHall is a great evolution from the erstwhile Food Bazaar but with an elevated shopping experience. Note – the elevation is not just the imported olive oils and nuts, wide range of cheese, or organic vegetables, rather the entire experience. 

The FoodHall also has a Deli, a Café and a Chocolate Bar, an in-house curation where a Chef prepares fresh chocolates with a Tempering Machines to produce interesting cute-looking chocolates which costs upwards for Rs. 500 for 6 pieces. Connoisseurs Delight, perhaps. The Cellar stocks and sells some of the finest wines from the world. And the Fresh Poultry / Meat / Seafood is a massive hit with an exclusive area demarked in so manner that there is absolutely no stench that comes out of the area. Overall, FoodHall has elevated the Grocery Shopping in India. 

Recently, RP-SG Group which runs Spencers Retail acquired Godrej’s Nature’s Basket which is a similar concept as FoodHall but the latter beats the former hands down with it’s range, assortment, pricing and customer experience. There are similar concepts in all major cities but the trend is yet to catch up outside Delhi/NCR, Mumbai and Bangalore. Is the market ready for gourmet grocery? Yes. Are the Retailers / Mall Owners & Shopping Centres ready? Perhaps, No.  It’s not just the shop or the real estate that would elevate the experience, rather the Retailer’s vision and readiness to cater to this elite segment of customers. Actor Madhavan is the Brand Ambassador for Elite Matrimony (in this age and time when marriage is not an institution but more of convenience and social status). 

So the premium Customer not only exits but also waiting. Let’s see who expands first and fast.

Why Coke wants Coffee...

A budding second generation Entrepreneur started an Internet café in Bangalore’s iconic Brigade Road in the mid-90s with the unprecedented boom in consumers using the World Wide Web to communicate with each other besides knowing a bit more about the world on the other side. Those days, an hour of browsing the Internet would cost ₹100 and a cup of coffee, perhaps ₹10 or so. It’s no surprise the costs have reversed today. 

 

Cut to 2019, the same Entrepreneur is expecting a valuation of $1 billion for his coveted asset, Café Coffee Day which he has patiently and painstakingly built over the past 20 years. The café has over 1,700 cafes across India now including a few outlets abroad. I was privileged to work in this team a decade back for 2 years where my team and I went ahead to set up over 140 cafes across Airports, Metros, inside large Retail formats such as Wal-Mart, Shoppers Stop, Odyssey, at Hospitals, University campuses, Cinemas and even at Cricket Stadiums at Chennai and Kolkata during IPL Matches. The bidder for CCD this time is none other than Coca Cola Company, world leader in carbonated beverages who has also been in India for 2.5 decades.

Why does Coke want coffee? Because they see an untapped opportunity to reach out to the millenials in India who are among the largest of their ilk worldwide. Pepsi, on the other hand has a majority of its business coming from snacks and food while Coca Cola Company with its wide portfolio dominates the carbonated beverages market which has seen a shy growth in India, thanks to alternative beverages, let alone a few healthier options. CCD cafes interact with over an estimated 3,50,000 patrons a day with an estimated 100,000 bills daily (assuming an average 3 persons per bill). That’s over 1.2 billion times of engagement annually, something that Coca Cola Co. can do perhaps only online with constant advertising. 

A recent report published by Euromonitor states that the Indian Coffee Market was pegged at ₹2,500 crores as of 2018 and could double in the next 5 years. With cafes becoming the third and most preferred alternative place to hang around after home and work place, Indians are embracing coffee cafes and tea bars like never before. In the immediate past half decade, chains like Chaayos and Chai Point have gained much attention from Consumers as well as deep pocketed Investors. World’s biggest café chain Starbucks entered India a decade back in a JV with Tatas and has grown to over 150 cafes till now while others like CBTL and Café Pascucci left the market even as the homegrown Barista and British chain Costa have found a small niche for themselves. Interestingly, Coca Cola Co. bought Costa Coffee last year for $5 Bn while Nestle bough the distribution rights of Starbucks across Europe for over $7 billion in 2018.

Interesting times ahead for discerning Indian consumers. Would we see us drinking Coke and Fanta along with a Cappuccino at the neighborhood café or the Mall down the road? I don’t know yet. Interestingly, Sidhartha of CCD has refrained all along from selling carbonated beverages ever since the beginning. But the brand’s future could be different. We are now seeing Spicejet logo on the erstwhile Jet Airways’ crafts. Time will tell how this story spins out. And although it’s not in my plan today, I am already fixing my Auditor’s meeting at a CCD. For the love of the brand and their coffee.

Self-Checkout or Assisted

Earlier, I wrote in my article for The Economic Times about how Self-Checkout or even an assisted one would make a cut in the Indian scenario even as Indians are embracing E-Commerce like no other and the Indian E-Commerce business is expected to cross over USD 50 Billion by 2025 by various estimates. Meanwhile, the Retail Industry in India is pegged at USD 500 Billion with just about 10% being Organised or even semi-Organised (meaning those shopkeepers who use some form of PoS for Billing & Accounting). Almost half of the semi-organised Retailers do not have an end to-end PoS solution and this is the latest trending opportunity in the realm of Retail Entrepreneurship with a number of existing players upping their ante while a whole lot of new technology is being tested and introduced by new Start-Ups. Interesting days ahead indeed.

Meanwhile, I visited the Apple Store on Orchard Road at Singapore during my recent vacation to the Country. It’s been 11 years since I travelled abroad and was yearning to see the Temple of Technology to seek the blessings of the Almighty Apple (sic). I have owned every Apple product ever made by the Company in it’s recent history, starting from the iconic iPod in 2007, iPhone (several of them!), iPad (two of them), MacBook, Apple Tv, Apple Watch and Airpods. I felt like a little kid inside Disneyland when I entered the Apple Store, that I was walking all along the counters and seeing the whole retail theatre with glee.  I wanted to interact with the staff and hence gave a request for a query on iCloud Management. I was given an appointment and was asked to wait for about 40 mins which I agreed with utter happiness so I can spend time there seeing how Apple consumers interact with the Apple Store. On the first floor was the Genius Groove – apparently the Genius Bar has now become a fledgling hub where atleast 100+ customers & staff can be seen seated together and interact on various service issues. I picked up my iPad and started browsing with the free internet provided by the Apple Store – a whopping 110 mbps even as so many of them were sharing the same internet. Finally, my turn came and I was assisted ably by Justin who clarified some basic as well as a few complicated queries on iCloud. He was extremely polite and knowledgeable and sent me back happy. 

I returned a day later to buy the new iPod which was launched on Thursday 30^thMay 2019. I saw about it on their website and ended up at the store to pick it up. The staff themselves were surprised that it was ready for Sales! I placed an order on the mobile PoS which the staff had where I was allowed to browse the options, colours, etc. I placed the order and waited for 10 minutes by when another Apple Staff brought the product and handed over to his colleague. She placed my order on the same handheld PoS and my transaction was completed in less than 2 minutes. I was pretty excited doing this transaction and saw first hand how Omni-Channel Retail actually works. While I have seen similar technology being made available at a few Indian Retail Stores (Croma, For Example), the seamlessness and the convenience was fantastic from a user experience. 

There are atleast 20,000 companies, small medium or bigger who make PoS solutions including market leaders like GoFrugal, Wondersoft, Pathfinder, etc. to name a few. The solutions are priced from a one-time payment for as low as Rs. 10,000, SaaS models with recurring payments, enterprise solutions and so on. At my own Start-Up “Smiling Baby” – a chain of baby care stores, we signed up GoFrugal Technology’s eponomous “RayMedi” software which is now christened “RPoS” and have invested heavily 2 years backwith a module to manage Inventory across our multiple franchise stores including product management, adding inventory, live stock status and much more. With two running stores and two more in the pipeline, we have put the software to great use although we are yet to unlock so many hidden features including the omni-channel option where in we can rotate stocks across stores based on user requirements. Also, there is an option to connect the software with a mobile App, so Consumers can actually check which product is available at which store and accordingly, they can place orders online for a home delivery or a store pick-up. And this, for a small Start-Up like ours which is certainly not heavy on piled up cash investments. 

Omni-Channel offers a great opportunity for SME Retailers as much as the established ones. Time to make the most of it now.