Retail pays off

The Indian retail market, the fifth-largest retail destination globally, has been ranked as the most attractive emerging market for investment in the retail sector by AT Kearney's eighth annual Global Retail Development Index (GRDI), in 2009.

Further, organized retailing is growing at 50-55% in small towns compared to 30% in large cities. According to the estimates by Ernst & Young, while there were some 50 superstores (including Malls and Hypermarts) in 2006, this figure is likely to quadruple to 220 by end-2007. Organized retail is expected to grow four-fold from $7 billion to $30 billion by 2010. 

Retail is the pulse which will gauge the products sell through. Ultimately, the success of   any brand depends upon the "Choice" of the end-consumer, and retail enables the company to come closer to the consumer. "Logitech believes in making consumer experience smooth and comfortable through cutting-edge technology, which can be demonstrated very well in retail showrooms. Our channel strategy always had the retail channel as a medium to interact to the consumers at large, and we expect it to continue and grow in the near future as well without affecting the current channel structure," says Subrotah Biswas, Country Manager - India & South West Asia, Logitech.

SanDisk has continually expanded its retail presence in order to reach out to an increasing number of customers across India. SanDisk has the presence of close-to 20,000 retail partners in the country. "We work very closely with our channel partners in creating awareness and educating them," says SanDisk.

Channels play an extremely significant role in furthering the growth of flash memory in India as they act as a bridge between SanDisk and its existing, potential and prospective customers. SanDisk is the only company in India in this category that has taken the responsibility to train and educate channel partners about high-end and high capacity cards, their benefits and the burgeoning demand for USBs and memory cards. The initiative has been instrumental in creating a lot of awareness about the category among channel partners and has been well appreciated by them. This is an ongoing effort that is being proactively taken across India by SanDisk. "The handling for channel partners in the lifestyle segment certainly requires different treatment as educating the partners is as critical as marketing a good product," says SanDisk.

"Our strategy is to work with the key retailers and distributors to offer the broad range of SanDisk products. Recently, we created ‘Memory Concept Stores’ to reinforce our presence in the Indian market," says SanDisk. "These breakthrough 'Memory Concept Stores' are present across prominent large format retail outlets in India and represent the entire range of SanDisk's portfolio. It brings a fresh new look to create a uniquely satisfying customer shopping experience. The consumers will be able to experience a wide variety of new products, ranging from USBs, imaging cards, to mobile memory cards."

The Indian channel community is definitely one of the key markets for SanDisk. The company works very closely with our distributors to deliver SanDisk memory cards, music players, flash drives and other key products that are in high demand by local consumers. "Our strategy in India is to provide consumers with the highest quality products with the best value. We will continue to offer products that are ideal for a variety of uses including a range of cards for digital cameras and camcorders, USB flash drives and cards for mobile phones," says SanDisk.

SanDisk's retail marketing strategy is to provide consumers with the highest quality products with the best value. The company offers a wide range of products that are ideal for a variety of uses including a range of cards for digital cameras and camcorders, USB flash drives, digital music players and cards for mobile phones. 

SanDisk's strategy is to work with the key retailers and distributors to offer the broad range of SanDisk products. The company continues to build its retail presence in a growing number of key cities and urban centres and is leveraging the growth of the consumer electronics products such as digital cameras, computers and mobile phones. "We are working at creating familiarity and awareness of SanDisk on 'high performance and high capacity' products and how to select the right product for the consumer's particular need for all categories in India," says SANDISK.

Toshiba rolled out its first laptops in India in the year 1994. So far, Toshiba concentrated more on the B2B vertical for conducting its business. But over the years, with significant changes taking place in the IT and business landscape, Toshiba explored the idea of entering the retail area. While the company's major thrust was on B2B business, they remained equally focussed on the retail segment. However, in the last quarter of CY 2009, it saw a slump in the B2B business, with the number coming down to below 50%. The company started looking at the retail route more aggressively, as this was the need of the hour. While the B2B segment of the company accounted for 30%, the retail business rose up to a significant 70%.

Going forward, keeping in mind the growing consumer needs and its wider line of products, B2C segment has grown to become an important segment for Toshiba. It has been evident in the last two recession-hit years that the consumer market continued to contribute to the growth without much of a change witnessed in their purchasing behaviour. 

The company has come up with a two-tier channel network - working with retailers and national distributors like Ingram Micro and Redington. Toshiba has also announced its tie-up with the leading IT hardware distributor Rashi Peripherals for its entire range of External Hard Drives throughout India. Besides the traditional channel network, Toshiba has also made a larger presence in the LFRs, multi-brand and franchisee-owned brand shops, to cater to its consumer segment. It has at present 50+ exclusive franchisee-owned outlets and close-to 550 multi-brand stores all across the country. The company has plans up its sleeves to raise the number to 81 and 550, respectively by the end of the year 2010. Besides growing the number, the company is also investing heavily in terms of quality, which would enable it to deliver the right kind of consumer experience and technology strengths.

"It has to be in the main marketplace, ground floor to attract more customers. The location also matters a lot (centrally located areas are preferred).  We have a pre-determined investment (including manpower, infrastructure) in place and also a target," says Wu Tengguo, Director, PC Division, Toshiba India (P) Ltd.

"As an exclusive store, they are expected to display every new model so that customers get a flavour of the new offerings from Toshiba. There will be brand promoters also to help the customers and showing them around," says Wu Tengguo. 

Computer peripherals vendor Logitech's retail business accounted for 85 per cent of its revenue in FY 2009. Logitech's retail business also includes personal peripherals for platforms beyond the PC, such as gaming consoles, portable music players, mobile phones and home-entertainment systems.

"Today, our products are available across the country through our distributors and organized retail stores.  We are looking at strengthening our business relationships and further consolidating the overall business. Logitech would continue to expand its market reach by expanding its dealer/ reseller base all across India, through the above distributor sales infrastructure," says Subrotah Biswas.

The company's original presence and growth in retail was driven by a trend among consumers to enhance their basic desktop PC systems with more fully featured personal peripherals that add functionality and cordless freedom to their desktop. Now, consumers are also purchasing supplementary devices designed for new applications and specific purposes such as gaming, digital music, multimedia, audio and visual communication over the Internet and PC-based video security.

"We have shop-in-shop and Flagship stores of Logitech. We understand the importance of display and demonstration of our innovative and cutting-edge product portfolio, and we are keen to establish and expand our shop-in-shop concept at major towns and cities. The concept is to give 'Live Demonstration' of our key categories, apart from displaying the range in neat stacking. The objective is to satiate the consumers of live demo and availability of all Logitech products under one roof," says Subrotah Biswas.

In the PC peripherals space, Logitech is a preferred brand and has high recall and a strong reach. The company is working with our distributors and channel partners to build on these strengths in 2010 as well. "We are consistently introducing products that excite our customers and to continue this we have increased our focus on innovating newer technologies that are relevant for today’s customers," says Logitech.

"We have worked on a 360-degree approach focussing on dealer/channel motivational   schemes, consumer benefits which include warranty etc. along with channel staff and promoter staff incentive schemes. This has enabled us to win the confidence of the market. And, we hope to continue and bring more elements and components to it in the near future."

Finally ....

The retail segment with special reference to consumer electronics and IT products has evolved a lot over these years. Point of purchase environment, display merchandize and customer service play an important role in achieving customer loyalty and increasing sale volumes. Today's consumers are well informed. It is just that slight handholding and last-minute guidance that are required by the customer before making the purchase according to his/her needs. Training is almost necessary for both retailers and resellers.

For more contact :
Deepak Singh
edit@varindia.com