In the second week of January this year, shoppers at Big Bazaar in Nagpur's Sitabuldi area were in for a surprise. The size of the food & beverages section was doubled and the fashion segment was renovated to make it look like a jazzy departmental store with new flooring, concealed lighting, stylish mannequins and so on.
The Nagpur store is not alone. The Kishore Biyani-promoted hypermarket chain is shedding its 'same-old-stuff' tag, and revamping its stores to woo back customers who are now spoilt for choice because of relative newcomers such as Star Bazaar, Aditya Birla's More, Hypercity and others.
Big Bazaar is the oldest (its first store came up in 2001) and the largest (it runs 166 stores), but it has become obvious that the early mover advantage wouldn't last for long as consumers are graduating from the earlier novelty of a 'modern bazaar'.
"Big Bazaar wanted to be an upgrade of a bazaar or a mandi selling loose staples and grains. It was fine till 2004 but when other retail chains entered with better ambience and merchandise mix, they could not hold consumer interest," says the head of a Mumbai-based retail chain. He says Big Bazaar's inventory management was also not in order which choked its finances.
"Earlier, Big Bazaar was not mirroring shoppers' thoughts in certain categories," says Ankur Shiv Bhandari, managing director for the Indian subcontinent, Kantar Retail.
By and large, it was selling more of the same like plastic containers and cutlery, FMCG products and apparel which were not different from any of the multi-brand apparel outlets.
The same store sales growth was in low single digits, reflecting poor customer offtake. Same store sales growth refers to the growth coming from stores which have been in business for a year or more.
"'Processes and methods were ignored in the past. If these had been followed and built into the DNA, things might have been better, " says Sanjay Badhe, an independent retail consultant and former head of marketing at Aditya Birla Retail.
But all that is changing. And the seeds of that change were sown at an event called 'Spark' held in Jaipur last September where all the 166 store managers met Biyani as well as Sadashiv Nayak, chief executive officer, Big Bazaar.
"It's a 12-year old brand. We got rid of unviable stores and rebooted the existing ones to make these more relevant to customers," says Biyani, group chief executive, Future Group, the parent of the chain. The group has closed nearly nine loss-making stores in the last one year and half-a-dozen have been relocated.
"The concept of bazaar and the sense of abundance are still there but the whole focus of the revamp is to give more convenience to customers and provide depth in categories," said Nayak.
The makeover is happening in three ways-complete revamp, partial revamp and category revamp. Complete revamp means a total change in the look and feel of the store, while partial refers to change in one or two floors. Category revamp refers to the launch of new products in a category and refreshing them and so on.
At the completely revamped store at Lower Parel, the ground floor looks like a department store - apparels are stacked in such a way that shoppers can first find a category (mens' wear or womens' wear), then brand and finally the kind of the apparel (whether it's jeans or a kurta). The second floor has a live kitchen and large fresh produce section.
Nayak says fashion had been the thrust area of category revamp. Big Bazaar has already revamped the fashion segment called FBB (acronym for Fashion at Big Bazaar) at all its 166 stores. So the entire lighting, flooring, texture, visual communication have been changed.
As part of the FBB rejuvenation programme, the chain has either hired people from fashion institutes, department stores or replaced staff who knows to sell fashion better. Nayak says the chain has taken 100 stores in the top eight cities as priority for this programme. "In many of the stores, we want customers to experience fashion first and then walk into the store," says Nayak.
The chain is also bringing innovative products and sub-categories in the home section. In Mumbai, where homes are smaller in size, the chain is selling compact storage solutions and plastic containers which consume less space.
The result of all these initiatives is already out. While the FBB segment is growing at 30 to 40 per cent in sales, the revamped stores are showing double digit growth. "Wait for the next quarter, you will see the growth in high teens," says Biyani.
Nayak says 'Sewa' is one of the key projects aimed at consumer convenience. Under this project, which is being implemented in 10 locations, the store has grinders to grind wheat, soya or ragi and help make multi-grain flour. Store staff also helps shoppers cut vegetables and make rotis at no extra cost. The store also has counters which help shoppers with payment of utility bills.
"We are adding this element in the new stores in Chandigarh, Kochi and so on. We want to expand this to other stores too," adds Nayak. The chain has hired women called 'Sewa ammas' and gives them two to three months of training to do these chores.
Some, however, say revamp itself is not enough to change consumer perception. For example, despite the revamp, payment issues to companies persist . But Biyani downplays this and says payments may be delayed only in one or two cycles.