Click. Brick. And All That’s In-be­tween

“I want us to stop talk­ing about dig­i­tal and phys­i­cal re­tail as if they’re two sep­a­rate things. The cus­tomer doesn’t think of it that way, and we can’t ei­ther”, said Doug McMil­lon, CEO, Wal­mart. This quote is fast shap­ing the world of re­tail. Ac­cord­ing to

VM&RD - - Contents - Satarupa Chakraborty

The Lure Of Brick N Mor­tar

Brands deal­ing in spe­cial­ity mer­chan­dise seg­ments like Zi­vame, Len­skart, Caratlane, Nykaa, Ur­ban Lad­der have al­ready re­vealed their plans to build strong brick-and­mor­tar net­work. Lin­gerie brand Zi­vame and jewellery brand Caratlane plans to open 20 more stores each by next year, while lead­ing eyewear brand Len­skart has re­vealed its plan to open 200 stores fo­cus­ing on mini met­ros and small towns and beauty and cos­met­ics player Nykaa is look­ing to have 30 stores by next year.

On­line cloth­ing brands like Fa­bal­ley and Va­jor are fast be­com­ing parts of the league. Va­jor plans to open two stores in Delhi this year while scal­ing up their store counts in next 6-9 months. Fa­bal­ley, with 50 SISs with Fu­ture Group’s large for­mat stores, has re­cently opened an EBO. The brand has re­vealed its planned in­vest­ment for off­line ex­pan­sion is to be over 1 mil­lion USD, with the es­ti­mated off­line rev­enue share go­ing up to 30% of the com­pany’s to­tal rev­enue by the end of FY19. “In­dis­crim­i­nate ex­pan­sion is not on the cards as our off­line strat­egy is fo­cused on be­ing prof­itable at ev­ery door we op­er­ate,” Shivani Pod­dar, Co-CEO of Fa­bAl­ley, in­formed.

Open­ing its first flag­ship store in July this year in Ban­ga­lore, fur­ni­ture re­tailer Ur­ban Lad­der dis­closed that it will in­vest 10-15 mil­lion USD in phys­i­cal re­tail over the next 12-18 months. Dis­clos­ing more on the same, Pradeep James, Di­rec­tor of De­sign, Ur­ban Lad­der, added, “Driven by its strong on­line pres­ence and con­sumer data, the com­pany will build mul­ti­ple ex­pe­ri­ence cen­ters around the coun­try. The cen­ters will also be the pri­mary hub for new prod­uct

ranges and col­lec­tions.”

Reach­ing length & breadth of In­dia

As on­line re­tail is gain­ing mo­men­tum and en­cour­ag­ing ma­jor play­ers like Ama­zon to start

some­thing as unique as Project Udaan (an off­line part­ner­ship ini­tia­tive with re­tail­ers in small towns and ru­ral area of In­dia), here’s how these home­grown on­line brands are tak­ing their off­line band­wagon. Hav­ing 20 stores in 9 ma­jor cities, Sirisha Tade­palli, Vice Pres­i­dent – Brand Mar­ket­ing, Zi­vame, said, “We will open stores wher­ever there is mar­ket gap and in­dus­try trend. Though we bet big in met­ros and mini met­ros, some small mar­kets like Coim­bat­ore and Mysore sur­prised us. We are cur­rently eval­u­at­ing 20 top cities of In­dia to go fur­ther with our ex­pan­sion plans.”

Be­ing a jewellery brand, Caratlane is cur­rently fo­cus­ing their off­line growth in mar­kets like Delhi and other ma­jor towns in north In­dia, while Nykaa as­pires to present in tier II cities too as a beauty re­tailer. An­other lin­gerie brand Clovia has just started their ex­clu­sive brand net­work with 3 small stores in Delhi but is fo­cus­ing ma­jorly on smaller towns and their next store launch is slated to hap­pen in an ob­scure town called Pu­ru­lia in West Ben­gal.

The Tech Con­nect

While “phy­gi­tal” plays the key role for this bur­geon­ing omni-chan­nel ex­pan­sion, some brands chose sim­pler store de­sign to fit into the pure play of brick-and-mor­tar, while oth­ers are fo­cus­ing on dig­i­tal in­ter­faces.

On this front, we surely can’t miss the Myn­tra Road­ster store that opened ear­lier this year in Ban­ga­lore. The fu­tur­is­tic store spread over 4000 sq ft com­bines the ac­ces­si­bil­ity of touch-and-feel along with in­te­grat­ing tech­nol­ogy with el­e­ments like in­ter­ac­tive LED façade, Shop­per-con­trolled video walls, dig­i­tal gam­ing and brows­ing op­tions, VR zones etc. Ananth Narayanan, CEO of Myn­tra & Jabong, said, “This was our first step in cu­rat­ing an omni-chan­nel pres­ence and will be a ma­jor area of fo­cus for us in the months to come. We have cre­ated ex­cep­tional brand ex­pe­ri­ence trans­formed by tech­nol­ogy and a new av­enue for shop­ping.”

Ur­ban Lad­der’s first store also came with com­plete ex­pe­ri­ence of the prod­ucts through AR/VR gear tech­nol­ogy. “The aim is to el­e­vate and in­spire cus­tomers to get the most com­pre­hen­sive look for their space,” James added.

In­ter­est­ingly, most of the on­line brands, with in-house tech­nol­ogy teams, are cre­at­ing these store ex­pe­ri­ences. As Ananth said, “We have a his­tory of 1.5 years ex­pe­ri­ence now in omni-chan­nel and we have learnt as fast as tech­nol­ogy moved.” “What on­line brands have is the clear in­di­ca­tions of con­sumer be­hav­iours and pref­er­ences. Hence, un­like tra­di­tional brick-and-mor­tar play­ers, we are com­ing in the phys­i­cal store busi­ness with the al­ready-learnt con­sumer data. This clear un­der­stand­ing has paved the way for do­ing per­fect store ex­pe­ri­ences,” Tade­palli of Zi­vame added.

For­mats to Suit All Needs

The brands who are lit­er­ally join­ing the slew of brick-and-mor­tar ex­pan­sion are also in­no­vat­ing store for­mats and de­sign con­cepts. Beauty and cos­met­ics brand Nykaa has two store for­mats – Nykaa On Trend and Nykaa Luxe. As the names sug­gest, the former for­mat span­ning around 500 sq ft ap­prox­i­mately houses top sell­ing 1000 prod­ucts while the lat­ter with ap­prox size of around 1000 sq ft fea­tures 30 pres­ti­gious brands from around the world. On the store de­signs, Ad­waita Na­yar, Head of Re­tail, Nykaa, ex­plained, “The for­mats vary on sizes and the pre­mium lev­els. We be­lieve in com­plete phy­gi­tal ex­pe­ri­ence for all our stores. The cus­tomers can scan a prod­uct not only to know the de­tails but to also learn on the re­views posted on our on­line chan­nel. We have

dig­i­tal in­ter­faces to show­case trends etc. We see that 80% beauty mar­ket is off­line so we want to strengthen our pres­ence in off­line space but cer­tainly of­fer­ing our con­sumers much more.”

Af­ter launch­ing their no-in­ter­net app prod­uct Len­skart Lite and set­ting an ex­am­ple of set­ting up 90 stores in 90 days in last year keep­ing the store de­sign model small, lean and prof­itable, the omni chan­nel eyewear ma­jor Len­skart is plan­ning to bring a store con­cept in the same name. Len­skart Lite stores will be smaller in sizes with sim­pler de­sign and will find its ad­dresses in smaller towns.

For Caratlane, the store sizes vary from high street to malls. Rad­hika McGre­gor, Vice Pres­i­dent – Re­tail Ex­pe­ri­ence, Caratlane, ex­plained, “We cu­rate dif­fer­ent mer­chan­dises for both these lo­ca­tions. The sizes for mall stores are gen­er­ally around 400 sq ft whereas the sizes for high street stores vary be­tween 700 to750 sq ft.”

The Store Is Here To Stay

Shun­ning all the predictions that e-com­merce is slated to eat up the phys­i­cal store sales, global re­tail trend is throw­ing ma­jor lime­light on brick-and-mor­tar. Al­most all brands in the league have agreed that phys­i­cal stores may not have been able to give an im­me­di­ate es­ca­lat­ing push to their busi­ness but it has cre­ated im­mense brand value. Af­ter launch­ing the unique store ex­pe­ri­ence, mar­ket share of Myn­tra’s pri­vate la­bel brand Road­ster in Ban­ga­lore has gone up by 4%. This clearly shows that the true value of omni-chan­nel is here to stay for years to come.z

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