Planet M: Bargain add-ons

Mobile retail is not an easy business. Customers drive hard bargains and consequently the profit margins are thin as a wafer. In this scenario, Planet M, bought two years ago by Videocon from the Times Group, wants to create a USP: It is ready to negotiate on the add-ons, though not on the phone. Its latest TVC depicts how customers ask shopkeepers ‘kitna’ (how much does it cost?) just before they begin to bargain. The tables are turned in the last shot when a Planet M staff asks a mobile phone customer the same question.

The retail chain, which has been selling mobile phones for three months now, has let customers strike a trade-off between the handset price and the additional features that it offers on a phone model, which Planet M Retail CEO Subir Ghosh informs, is not a one-off scheme but the chosen long-term differentiator. “Branded mobile phone retailers often have it tough in comparison with unbranded shops. The salesperson on the floor does not have the power to negotiate with the customer on features since the prices are often pre-ordained, should the customer want to pay less. By letting the customer decide which extra features he wants, rather than bundle the features, and hence the price he pays, our stores will enable that flexibility.”

With this positioning, Planet M has begun to allow buyers to either choose from a host of value-additions that could see the price increase from Rs 100 to Rs 500, depending on the phone model, or settle for a phone with features as loaded by the manufacturer. The value additions include a prolonged warranty, a standby-phone during repairing, theft insurance and so on. With the Kitna campaign on air, Ghosh expects unaided recall of the retail chain amongst prospective mobile phone buyers to double.

Mobile phone retail is a part of Planet M’s larger scheme of participating in the budding digital music ecosystem. “Handsets are the future of music consumption. We want to encompass the ecosystem of digital music consumption,” observes Ghosh. Hence the need to wedge a toe-hold in the Rs 25,000-crore mobile handset retail market. To take its entry into digital music a step ahead, the chain is mulling pre-loading music on phones. The retail chain also plans to be a platform for launch activities by handset manufacturers, especially for music phones.

Further, Planet M is deploying WiFi in all its outlets. According to Ghosh, this will enable store visitors to buy vouchers and download music immediately in the store premises. It is tying up with digital music content owners to facilitate the same in the next 45 to 60 days, all in a bid to become a destination for digital music consumption.