They’re already buying groceries, household goods, electronics and clothes from his stores. So what does Kishore Biyani – one of India’s largest and most successful retail chain owners wish to do next? Sell them health and beauty services under the same roof.
Pantaloon Retail India is planning to launch ‘Health Village’ – a brand which will offer a range of products and services under one roof. This includes beauty salons (‘Star & Sitara’), a pharmacy called ‘Tulsi’ (a local Indian medicinal herb), beauty stores by the name of ‘Turmeric’ and fitness centres called ‘Roots’.
Biyani believes there is a space for a value lifestyle format in beauty and healthcare. “We believe in democratising our services and charging a fair price. The idea is to set new benchmarks for pricing in this segment,”said Mr Rahul
Bhalchandra, head ( Wellness) speaking to the Hindu Businessline newspaper.
Beauty and wellness services are seeing several interesting new organised formats. Lakme – a cosmetic brand owned by Hindustan Lever successfully runs a chain of beauty salons across the country. Marico, a company once best known for its Parachute brand of coconut oil, owns and operates Kaya Skin Clinic – a chain which offers a range of dermatological and cosmetic procedures. However both these brands cater to what advertisers in India call ‘SEC A & B’ – the affluent and the upper middle class.
The Pantaloon idea is different in that it targets the ‘middle and close to the bottom’ of the pyramid. These are customers who may already be visiting neighbourhood beauty ‘parlours’ run out of homes and small shops. For this segment, pricing is key. The group’s other stores such as ‘Food Bazaar’ and ‘Big Bazaar’ are already well known as value for money stores.
Biyani believes there is a great deal of untapped purchasing power with India’s underclass. In an interview to the DNA newspaper opined that the Indian consumer market can be divided into two – ‘India one’, comprising the affluent haves, and ‘India two’, the underprivileged and the hitherto ignored masses of the populace. “While most of the players are currently targeting ‘India one’, it is actually ‘India two’ where the big opportunity lies. It is just a question of putting money into their hands and they will buy whatever they need,” said Biyani.
The company is contemplating designing schemes where it can sell a TV set at Rs 40 (90 cents) per week or for that matter kitchen mixer at Rs 10 (25 cents) a week. Hire-purchase schemes are popular but they are offered only to those who have bank accounts or credit cards. Biyani proposes to devise a scheme which will lend on ‘trust’.
How he will execute this and other ideas is still not clear. But the fact is, this homegrown entrepreneur has a canny knack for understanding the Indian psyche. More and more foreign retailers are transporting their global models to India, hoping to attract the few million at the very tippy top of the pyramid. Pantaloons is the opposite approach – one that is adding new chapters to India’s retailing story.
Of course, there are challenges on the horizon – with India’s largest company Reliance entering retailing and Wal-mart waiting in the wings. Whether or not Biyani manages to stay one step ahead, his company’s insight and innovations have set the standards for expanding the retail market in India.