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Physical retailers increase investments to woo customers

By Sujata Sachdeva

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Business

As ecommerce players look for ways to outdo each other, physical retailers are also doing their bit to counter the ecommerce wave. They are investing in advertising, while increasing discounts on products to turn profitable. Some are also launching their own web platforms to take on online players.

Retailers take steps for growth

Future Group, which runs Big Bazaar, FBB and Central chain stores and another leading departmental store chain Shoppers Stop having Crosswords bookstore and HyperCity hypermarket under its fold, is increasing investments in advertising, while offering steep discounts and refurbishing stores to improve the customer experience to battle against online retailers such as Flipkart, Snapdeal and Amazon.

Big Bazaar and FBB have announced several promotions including a 52-week campaign called Crazy Weekends, where deals and discounts will be available at Big Bazaar stores every weekend, the company has also roped in actors Varun Dhawan and Katrina Kaif as brand ambassadors for FBB.

Mass and value retailers like Kewal Kiran Clothing, Liberty Shoes and Max Retail have decided to make an online foray by launching their own ecommerce platforms to battle the heavy discounts offered by leading e-retailers. They will create a separate collection for their web platforms to attract eyes.

While shoppers are choosing online platforms , physical retailers and brands are innovating too. Under growing pressure from lower rates offered by e-commerce players, leading apparel brands are increasingly looking at customised products to woo back customers.

Boost to fashion portfolio

Brick and mortar retailers are investmenting on expanding in-house offerings and revamping stores and marketing. For example, Shoppers Stop saw the share of fashion offerings increasing from 6 percent to 16 percent during the third quarter of the current fiscal and at Reliance Retail the share of fashion was 15 percent. Future Group’s fashion and lifestyle division gains the highest revenue on a per square feet basis.

Future Lifestyle Fashion owns and operates about five million square feet of retail space across its fashion formats. It has also been picking up considerable stakes in fashion labels to emerge strong among its rivals. While it recently increased stake in clothing brand Mineral from 22.70 percent to 37 percent, in October last year, the company picked up 60 percent stake in footwear firm Elisir Lifestyle. It has also acquired minority stakes in brands such as Tresmode, Famozi, accessories brand Peperone and Desi Belle. It offers a portfolio of over 40 fashion and lifestyle brands. Reliance Retail opened the doors to 11 Reliance Trend stores during the third quarter and partnered with fashion brands like Cherokee, Juicy Couture and Iconix India brand.

Studies point out that at Rs 18,000-20,000 crores, ecommerce in India, at the moment is just about 10 percent of the organised retail market, and estimated to grow to over 15 percent of the organised retail market in five years. Keeping the glory of the current online market in mind, from big corporate house like Reliance, Aditya Birla, Raymond, Arvind to American Swan, Nike, Puma, Raymond, Big Bazaar and Hidesign as well as foreign fashion labels are either jumping on the e-wagon or have already launched their websites or listed their products on third-party web-platforms.

Future Retail
Shoppers Stop