That the retail scenario in the Indian apparel industry is getting more colourful in the tier 2/3 cities is now common knowledge. Adding to that is the deep mobile penetration in such regions and increasing affordability of smartphones – prompting even semi-literate mobile users to start using the internet for a variety of reasons, online shopping being one of them.
Online-only retailers such as Flipkart and Snapdeal would be getting competition from the traditional store retailers on the e-commerce front, not to mention from big brands such as Lifestyle, Pantaloons, Shoppers Stop to name a few.
However, to stand out in the plethora of retailers, especially in the emerging gamefield of e-commerce, it would be important for any retailer to focus big on customer relationships – much more than it has been doing so in the past.
Indian retailers should vie to promote their businesses in a big way via social media – Proactively reaching out to wherever there customers spend most time on, on the internet, be it Facebook, Twitter etc. – engaging them in mutually beneficial forums and discussions, while also making them aware of the company’s latest customer orientation endeavours.
For instance, instant refunds on online shopping is something which undoubtedly wins customer trust and encourages them to keep coming back to the retailer – and which now is increasingly being adopted by many online retailers.
However, wouldn’t it be better to envision a scenario where the need for refund itself disappears?
This could be accomplished by a retailer which has both offline as well as online operations. The idea is to deliver the ordered merchandise by the company staff directly to the customer on a cash on delivery (CoD) basis, along with not just the ordered item but instead an assorted variety/ sizes of the same item.
What would be the pluses with such a strategy?
For one, this model would find greater acceptance and loyalty amongst the tier 2/3 city shoppers, not all of whom might have the capability to actually make a payment for purchase via the common mediums such as credit/ debit cards, which is quite common in bigger cities.
Secondly, it might also lead to additional sales – of the same item, or even additional apparels. Consider a scenario where your store rep visits the customer’s house to deliver a pair of dark blue jeans, which he has ordered online. What if the store rep brings along other assorted shades of the same jeans? Add to that giving the customer the luxury of trying out the pair of jeans he actually ordered in the comfort of his home before actually making the payment; as well as trying out the other shades of jeans! Now let’s take this a step further – The surprise factor. How do you feel your customer would react if suddenly the store rep tells him that he gets a discount of 20% on the additional pair(s) of jeans he might now choose to also buy? Chances are that 1 out of 5 such customers served by this e-commerce model might go for additional purchases.
Okay, so what if the customer doesn’t have that much cash readily available at the time when he gets this surprise offer from your store rep? No worries! This would infact be a better chance to further promote your customer relationship. How about an offer to make a repeat visit to his house the next day? Or, to encourage him to become a ‘discount’ customer by filling up a membership form?
Thirdly, such a business model would be more readily accepted by the people in tier 2/3 cities and towns, where traditionally they are psychologically prompted to get ‘the look and feel’ of the product before buying.
All this might sound like a lot of investment in the form of additional human capital and deliveries; however, keeping the consumer mindset and the word-of-mouth marketing in such smaller cities and towns, any retailer might do worse than seriously consider such a business model.
A retailer such as V-Mart, which has tactfully chosen its stores’ expansion based on a cluster strategy, wherein each store is located around 150 kms from the other store, could well be poised to become a ‘niche’ e-commerce retailer and take customer orientation to the next level when it hits the online button next year.