India Retail Forum

The biggest retail event of India packed with back-to-back sessions, workshops, exhibitions and unlimited networking opportunities exceeds everyone’s expectations yet again with a huge numbers of retail captains and policy makers thronging the venue to shop for success.

Over 3,000 leaders, delegates and stakeholders – virtually the Who’s Who of the Indian retail industry – thronged the auditoriums and exhibition spaces of the India Retail Forum (IRF) 2011 that concluded with a colorful awards ceremony on the night of September 22, 2011, at Mumbai’s Hotel Renaissance.

The two-day annual forum, perhaps the most important event in a retail executive’s diary, was modeled around the theme of “Shopping for Retail Success.” It was loaded with about 35 high-powered sessions, workshops and debates covering a wide swathe of topics that are of immense interest to India’s $28bn organized retail industry. Over 200 speakers discusses issues such as FDI in retail, store design, understanding the urban consuming class, what ails Indian retail, brand positioning, the Tier 2 / Tier 3 opportunity and a host of others.

There were also around a 100 companies in the exhibition halls showcasing their products and properties to the delegates and visitors who were busy checking out the new offerings and networking with others in the cafes and cafeterias of the forum. The mood among the delegates was cheerful and festive, with a lot of optimism for the future of Indian modern retail.

IMAGES fora are known worldwide, where the retail, franchise and shopping centre fraternities converge to explore India – a market that is highly likely to emerge as one of the largest retail destinations in the world by the end of this decade.

The Opening Salvo

IRF 2011 was unique in many ways, one of which was that it was preceded by three “Master Classes” on topics such as the franchising business, creating a better shopping experience and visual merchandising.

Talking on the sidelines of the master class on ‘Seeing is Believing: Visual Merchandising for Successful Retailing,” store-design expert Michel Van Tongeren (Director, Branding & Strategy, SVT Branding Design Group, Netherlands) declared big Indian retail stores to be chaotic, cluttered, and messy in terms of presentation and organization. “They lift formulas and ideas from international chains and implement them badly. It is important for them to be Indianized in terms of presentation and visual merchandising. They should learn from the great culture of visual identity and aesthetics that has existed in India for thousands of years,” he said.

Tongeren advised big Indian retail stores to pay more attention to detail, ensure much more clarity of offer and logical build-up of merchandise, and arrange for better segmentation and organization. “Indian retailers have to think of how they can involve their brand’s personality in everything that they do. Visual merchandising should speak for itself one way or the other,” he added.

IRF: Day One

Day one of the IRF began early with a pre-inaugural session on “The Facts Behind the Figures.” Addressing the delegates, Ireena Vittal, Principal, McKinsey, noted that the main characteristics of the Indian economy over the last decade have been resilience, reduced volatility and a growth mainly led by private consumption, unlike in China and Brazil.

She mentioned five trends in the Indian economy:

shoppers are getting richer faster;
many more ‘Indias’ are emerging within the country geographically and digitally;
consumers habits are changing driven by supply cycles of product upgrades;
volatility in cost and growth is here to stay, especially in terms of food, cotton and power prices;
the Indian industry is going to witness more fragmentation before consolidation.

“There are two other trends worth a mention: the evolution of channels and talent scarcity,” she added.

Vittal said Indian businesses will have to learn to make more granular choices spread across multiple cities and channels. They will have to continue to shape the market in terms of new categories, frequent product upgrades and differentiated offers. Entrepreneurs also have to build flexibility into their business plans, learn to retain talent and create new learning teams to cope with the changes.

The power-packed inaugural session held in an auditorium overflowing with delegates urged retailers from India and abroad to benefit from the India growth story. IRF 2011 Chairman Bijou Kurien (President, Lifestyle, Reliance Retail) said the Indian market offers lucrative opportunities even though it may look chaotic and difficult to crack.

“For example, there is a huge opportunity in India for shopping center developers. The retail space per capita in India is only 2.5 sq. ft. compard to Brazil (4.5 sq. ft.), China (13.5 sq. ft.) and the US (47 sq. ft.). There are many challenges in the Indian market, but a lot of them can be converted into opportunities,” he said.

According to Thomas Varghese, CEO, Aditya Birla Retail, Indian retail is at an inflection point and Indian retailers have an opportunity to shape how the country shops. He asked them to tap into India’s demographic dividend and try to convert Indian youth into lifelong customers.

Kishore Biyani, Founder and Group CEO, Future Group, commended Indian retailers for managing to lay a strong foundation of modern retail in the last ten years in India. He said FDI will be a big game changer for the industry, but GST will be even a bigger boon.

One of the most interesting sessions at the Indian Retail Forum 2011 was titled “FDI in Retail: Understanding the Issues,” with ten top executives and stakeholders from the industry debating the desirability of allowing FDI into retail. Most industry executives made a strong pitch for opening up Indian retail industry to foreign players. Dr Rajiv Kumar (Secretary General, FICCI) strongly supported FDI, calling it a positive game and a win-win situation for Indian as well as foreign retailers. “There is a fear that large international retailers would import cheaper goods into India due to which the domestic retailers would suffer. This can easily be sorted by regulatory procedures,“ he said.

Bijou Kurien of Reliance Retail held similar views. He said retail is a capital-intensive business and Indian retailers need investment to grow their retail stores. Thomas Varghese of Aditya Birla Retail argued that while capability is important in retail business, funding is absolutely crucial for expansion, which makes FDI desirable. Kishore Biyani of the Future Group said that the most contentious issue about FDI in retail is the food business which impacts around 65 percent of the Indian population and care has to be taken about this while inviting foreign investment.

Raj Jain of Walmart India said that while most retailers are looking at FDI as an opportunity to get the much-needed capital into retail chains, that is only half the story. “While discussing FDI, we only talk about retailers and not about suppliers and consumers. Our supply chains require billions of dollars of investment. If FDI is allowed into India, large investments will flow in not only through retailers but also through supply chains and back-end logistics.”

The brainstorming session “The New Success Strategy: How Responsible Retailers are Profitable Retailers” beamed loud and clear the message that responsible retailing is the new success mantra for the Indian retailers to increase their profitability. Supporting the responsible retailing approach, BS Nagesh, Chairman, Retailers Association of India, said: “Being socially responsible is relevant for retailers as retail is a long-term business and it is important for them to connect with the consumers beyond business transactions. We have a responsibility to create a world around the industry as well.”

An interactive session titled “Retail Funding: Everything You Wanted to Know about Funding and Valuation” came to the conclusion that raising equity should become a habit for Indian retailers and not be a once-in-a-lifetime event because debt can create a big hole in one’s balance sheet. Mohit Bahl (ED, Transaction Services, KPMG) was of the view that the key parts of financial propagation for any business depended on factors such as what is your story, what is your business proposition, what are your back-end operations as well as what is your cash-generating ability and management strength. To choose a strategic investor, businesses have to consider what synergy can they get from investors and what is their brand appeal. Yo! China’s Ashish Kapur argued that to attract funding in food business, consistency across the entire retail chain is very important.

To highlight the importance of brand positioning, repositioning and how it should be done fruitfully, the power-packed session “Positioning Your Retail Brand” saw a slew of industry leaders participating as speakers, including Andy Campbell, Chief Brand & Marketing Officer, Reliance Retail; John Goodman, President & Regional Director, Ogilvy Action, O&M ASEAN; Madhumita B. Sinha, Executive Editor, Business of Fashion and Sportswear International India; Rohit Srivastava, Executive VP, Contract Advertising and Viren Razdan, MD, Interbrand.

Campbell argued that for a retail brand to be successful, it should be instantly recognized by the consumers and be consistently understood (pass the test of time). It should also be proven and profitable, trusted and believed and should have lived its values and kept the promises made to consumers.

Goodman presented a case study about a retail brand in China, which was built without advertising and by creating a context for the brand as well as stores with the help of mobile technology. This was a clear example of positioning a brand without advertising on TV. Sinha said that identifying and understanding the customer and highlighting points of difference are two very important aspects for great positioning of a retail brand. She suggested that retailers should let the stores and the products do the talking.

One of the major highlights of the first day at the India Retail Forum 2011 was the establishment of the Indian Retail Hall of Fame, with Raghu Pillai (1957-2011), considered the father of modern retail in India, being declared its first inductee. In an emotional ceremony, business leaders such as Thomas Varghese of Aditya Birla Retail, Biju Kurien of Reliance Retail and Vikram Bakshi of McDonald’s (North and East India) paid rich tributes to Pillai who passed away in Chennai on April 10 this year due to a fatal cardiac arrest. Raghu’s wife Janaki Pillai, who specially flew in from Chennai to accept the award on her husband’s behalf, said: “Raghu always said his life must be a story that he could tell to his grand children. To the last, he was true to his words.”

The India Retail Forum 2011 also threw open its doors to Gen Next with a novel initiative called the “Rising Star Challenge.” This first-of-its-kind competition gave students of India’s leading business schools their first taste of stardom as they analyzed some popular retail brands of India. Forty-one teams from twelve management schools in India submitted their case studies.

The all-girls team from the Indian School of Business, Hyderabad, walked away with the honours. It presented a series of strategies aimed at resurrecting Piramyd Retail which up till April 2007 continued its journey of expansion but still could not turn a profit. The finalist teams received grand prizes worth over Rs 1 lakh, including a wardrobe from Tommy Hilfiger and gifts from Orra Jewellery and the Mobile Store.

IRF: Day Two

After a hectic day of power-packed presentations, discussions and entertainment, the Day Two of the India Retail Forum 2011 began with a much needed session on how to build a corporate society full of service, wisdom and celebration. One of the senior most Art Of Living practitioners and teachers, Sri Prasanna Prabhu, guided the audiences on rediscovering the soul of Indian retail.

The day’s events then moved on to the various ways of increasing shopper conversion through back-end planning and store intelligence and solutions. One of the panelists, Ramesh Jairaman, MD, Tyco India, listed internal shrink, vendor fraud and security checks as major challenges for retailers. Nick Kyriacos, MD, Bentel; Naveen Luthra, VP, Strategic Alliance, Getit; Rakhi Nagpal, CMD, Dynamic Vertical Solutions, DVS; and Rajkiran Kanagala, National Head, Business Development, TCI, also shared their views on the subject.

Eminent entrepreneurs came together at a session called “Indian Retail Businesses: Going from Family Managed to Professionally Managed” to shed some light on the reasons behind hiring professionals in family-owned businesses. M Krishna Reddy, who has been running Apna Bazaar since 1980, said that the reason behind their success was that they brought in professionals with a human touch into their business.

Taking a slightly different view was Bhagirath Jalan of KSL India who said that family-managed business have always been far more comfortable and liberal as there are no hassles from shareholders and no strict targets to meet. “The only problem in family-run business is that there is no scope of rewarding or penalizing a family member,” he added. Abhishek Malhotra, VP & Partner, Booz & Company, noted that only one-third of family businesses sustain till the third generation, which shows the important of turning them over to professionals.

The power-packed session on e-commerce brought together industry players from various fields who discussed and educated the audience about e-commerce and how to go about starting an online store. Anubhav Kushwaha, Director, Biz Strategy & Alliances, eReasoning, Global Applications, said: “There is a trend of peer endorsements to facilitate e-tailing. The three things needed for online success are consumer confidence, consumer values and capabilities of retailers. Consumers are switching channels and the entire experience is becoming channel agnostic.”

Putting a perspective to the industry was Sundeep Malhotra, CEO, Homeshop18, who said that e-commerce constitutes 4 percent of the total retail industry in India, and is going to see a growth of 8 to 9 percent in the coming years.

The session on understanding the opportunities in tier II and III cities revolved around the scope of diversified opportunities in these areas, the high level of innovation shown by the their residents and how marketers can utilize the hidden talent of all these innovators.

Prof Anil Gupta from IIM-Ahmedabad led the discussion by talking about Imphal which is credited with the highest number of innovations in the country. According to him, when organizations consider the innovative ideas of the youth and game-changers of these tier II cities, there is a sense of pride and motivation among them. If this can be backed by great incentives, wonders could be created. He said the buyers in tier II and III towns are not impulsive, unlike in the metros. Rather, they take their time to see, understand, discuss and then decide.

Salil Chaturvedi, MD, Provogue, said that aspiration levels are high in tier II and III cities. However, customers there need more help and education on the shop floor about the products. This means that self -service shops will not work beyond the tier I cities. “Retailers need to understand the social structure of these places before getting in. People have a different psychology in different parts of India. A company must understand local behavior and conditions,” he added.

In a session on the performance of international brands in India, James Munson of M&S Reliance said that 52 percent of the company’s products sold in India were sourced locally last year. “M&S sources 10 percent of its products from India. Even though we localize our business, we will not have an all-Indian collection because we are an international brand,” he added.

Sudhir Pai, Head of Hamleys India, revealed that their brand does not believe in spending heavily on marketing. Most of the money is spent in creating an experience. “We also pay higher wages to the front-end staff in India than the industry standard,” he said.

New Kids on the Block

The India Retail Forum 2011 also witnessed the launch of a brand new magazine from the Images Group, targeted at the Indian franchising industry. The monthly publication, titled “Images Franchise,” was officially launched by Kishore Biyani, the Founder & CEO of the Future Group, at a ceremony at the IRF. It has been brought out in partnership with the managing consulting firm, Inventure India, and is supported by the Franchising Association of India (FAI), the World Franchise Council (WFC), the International Franchise Association, the Asia Pacific Franchise Confederation and a host of other national franchise associations across the world.

Said Images Franchise's Executive Editor Chandra Prabha: “Through this magazine, The IMAGES Group and Inventure seek to fill the knowledge gap in India about the franchise business and introduce to the readers global best practices. It aims to catalyze the growth of the Indian franchise industry to bring it at par with the international standards.”

The day also saw the launch of a report titled “Children’s Apparel and Footwear Market in India” by the Images Retail Intelligence Services (IRIS). Vivek Kumar, Director, IRIS Retail, said: “With the rise in the number of double-income families, children becoming influencers in purchase decisions, and working mothers spending more on kids, the needs of parents and children have increased considerably, which has translated into the formation of micro-segments within the children’s category. The children’s market has plenty of headroom for expansion and thus presents a massive opportunity for retailers.”

According to the report, the retail market for children’s apparel in India is currently estimated at Rs 26,300 crores, which translates to a 15.4 percent share of the total apparel market. It is clocking an annual growth rate of 17 percent and is expected to touch Rs 30,800 crore this fiscal.

Later, with a little help from thumping music and some great performances, the retail community let their hair down at the Coke Studio. Leslie Lewis, Harshdeep Kaur, Sanjeev T. and Parthiv thrilled the audiences with a smashing music show.

Images Retail Awards

The India Retail Forum 2011 concluded with a colorful and lively awards ceremony, with delegates partying well past midnight. Bhaskar Bhat, MD, Titan Industries was honored with the coveted title of the “Most Admired Retail Personality of the Year” at the 8th annual Images Retail Awards (IRA).

Presenting the award amidst cheers from captains of the retail industry, IRF Chairman Bijou Kurien and IRF Chief Convenor, Amitabh Taneja, praised Bhat not only for his outstanding leadership, professionalism and long-standing integrity that made Titan Industries one of the most profitable and fastest expanding companies but also for his exemplary CSR initiatives.

The eminent jury for the awards consisted of Kishore Bhatija, CEO, Inorbit Malls; S Raghunandan, CEO, Retail, Prestige; SK Sayal, CEO, Alpha G Corp; Pranay Sinha, MD, Star Centres; Amit Bagaria, Chairman, ASIPAC; Devangshu Dutta, Chief Executive, Third Eyesight; Harminder Sahni, MD, Wazir Advisors; Jonathan Yach, CEO, Propocare Mall Management; and Amitabh Taneja, Chief Convenor, India Retail Forum.

A total of 16 stylish trophies were awarded to India’s most successful retailers who fuelled growth and innovation across multiple categories in the 2010-11 fiscal year.

Most Admired Retailer of the Year – Fashion
Jack & Jones, Only
Most Admired Retailer of the Year – Fashion Accessories
Accessorize
Most Admired Retailer of the Year – Foodservice
Domino's
Most Admired Retailer of the Year – Consumer Electronics
Croma
Most Admired Retailer of the Year – Leisure
Landmark
Most Admired Retailer of the Year – Mobile & Telecom
Univercell
Most Admired Retailer of the Year – Entertainment
PVR
Most Admired Retailer of the Year – Health & Wellness Products
New U
Most Admired Retailer of the Year – Home Products
Home Town
Most Admired Retailer of the Year – Non–store Retail
Homeshop 18
Most Admired Retailer of the Year – Luxury
Tanishq
Most Admired Retailer of the Year – Department Store
Lifestyle
Most Admired Retailer of the Year – Discount Retail
Megamart
Most Admired Retail Launch of the Year
Hamleys
Most Admired Innovative Retail Concept of the Year
Cinepolis VIP
Most Admired Retail Professional of the Year
Bhaskar Bhat

IRF 2011 chairman Bijou Kurien said: “IRF 2011 reflected the positive optimism and energy prevalent in the industry this year. We are proud to present the Images Retail Awards 2011 to felicitate outstanding achievements in retail during FY 2010-11.”

Amitabh Taneja, Chief Convenor, India Retail Forum, added: “The environment was very invigorating, and the competition, very, very tough! Winners of Images Retail Awards are the worthiest among the top performers across 16 categories chosen for ‘Most Admired’ title this year.”

The evening saw scintillating performances by singer Rachael Varghese and Sona Mohapatra. The ravishing Simone Singh and the dapper Anish Trivedi proved perfect hosts for the evening.

As the curtains came down on the annual gala event, Kurien summed up India’s biggest retail extravaganza by saying: “IRF 2011 provided an opportunity for the members of the Indian retail fraternity to collaborate and grow their business. The biggest achievement of this year’s IRF is that during the two days, retailers and the entire support industry have come closer with a common vision to serve the customers and the nation.”