The complete manicure

Nabankur Gupta

The next time you visit an exclusive Raymond's outlet, you may find the sober window displays splashed with bright red umbrellas, paper boats, even toadstools. And the familiar dignified background strains of the shehnai may be replaced by hip Indian and western contemporary music.

Window-dressing? Of course "" but that's the initial idea. This is the precursor to the Rs 1,500-crore company's attempt to rejuvenate its 303-store chain and earn a higher percentage of its revenues from high-margin readymade apparel rather than suit and shirt material (readymades command margins that can be as much as 60 per cent higher than fabric).

Regular make-overs are integral to the retail business and The Raymond Shops, which account for a fifth of Raymond's revenues, are no different.

The new point now is that this is a concerted, strategic move. For one, accessories and displays will now be standardised rather than left to a franchisee's enterprise. For another, the look and format of the outlets will change radically.

At a cost of Rs 50 lakh to Rs 75 lakh each store, sumptuous wood and marble will be replaced by lightweight, trendy aluminium, for instance, and, based on customer feedback, clothes racks will replace conventional shelf displays in some cases.

The starting point 18 months ago was an IT initiative linking shops to track stock positions.

So far, 100 stores have been linked and the exercise is expected to be complete in three years. "The back office will play a big role," says Nabankur Gupta, group president and whole-time director, Raymond.

What had gone wrong? This four-decade-old pioneer concept in textile retailing is suffering as a result of the urban boom in malls and department stores. The experience of one of the earliest showrooms in Mumbai shows how.

Over the years, this store had developed a respectable number of loyal customers. The proportion of customers who visited the shop on three or more occasions every year exceeded 50 per cent.

But over the past three years, footfalls have dropped 20 per cent as this near-permanent fixture lost visibility to the glitzy malls. This apart, the average age of shoppers at the outlets has risen to 30-plus.

The rising age profile is as much of an issue for Raymond as dwindling footfalls. This is because the Raymond Shops have been steadily increasing the share of readymade apparel from 25 per cent of their total sales to 35 per cent.

To improve on this business, the shops need to attract people in the 25- to 35-year age bracket whose buying frequency is roughly three times higher than the over-30 age group.

The reason for what appears to be piecemeal transformation is logistical. More than a third of these shops have been around for a decade and were in need of routine upgrading anyway. By 1999, Raymond had renovated just six or seven outlets every year.

At that rate each store would have to wait for more than 40 years to be redone. By 2004, Raymond has increased the make-over rate to 15 to 16 stores. Beginning next year, the company plans to renovate 50 stores every year, so each store will get a new look every six years.

Even six years can be a long time in the chameleon-like retail business, so Raymond is trying to spruce up the old-format stores much before they come under the scalpel.

The winds of change blowing through the air-conditioner vents at the Raymond stores show that the basic premise on which the exclusive stores were set up 40 years ago is being challenged.

In those days, the product was far superior to the manner in which it was being sold at the retailer's end. As Gupta points out, "If a superior product was not delivered properly, then the brand's equity would be eroded."

At that time, Raymond's air-conditioned showrooms were enough to send signals of a superior shopping experience. Today air-conditioning comforts have been downgraded in the retail ambience to a hygiene factor, hence the reliance on the more trendy alcubond (an aluminium-plastic bond).

Customer behaviour has changed too; most prefer the freedom to examine merchandise rather than depend on salespeople to display them, hence the introduction of racks in some cases.

The product mix, too, presents a new set of challenges. Till 1999, Raymond had just two brands, Raymond and Park Avenue. By 2004, it had five brands, including Parx, Manzoni and Color Plus. This meant that the showrooms that range between 1,000 and 3,500 sq ft would be stretched for brand space.

Each brand has a different set of customers. Suit lengths that start from Rs 165 a metre attract customers from socioeconomic categories (SEC) B and C, while Manzoni (price band: Rs 3,500 to Rs 24,000) attracts customers from SEC A1+. Each of these customers require a different experience. And Raymond had to provide its customers five different experiences under a single roof.

Sure, the company also has multi-brand retail points, apart from the exclusive Raymond shops. But as Aniruddha Deshmukh, vice president, retail, points out, the exclusive shops are the flagship for all the brands; customer experience at the exclusive outlets will shape their impressions.

That is why the company has decided to introduce shop-in-shops at about 50 outlets for the Manzoni brand. For premium suit-lengths, the company has set up "exotic" customer counters.

To ensure quality, the company has a monthly housekeeping contest for its exclusive shops. Audit inspectors visit outlets and rank the retail space on parameters like maintenance, ambience and so on.

The winning store gets gifts worth Rs 75,000. However, the gifts are such that they are used to enhance the appeal of the store, like plasma TVs, music systems, vacuum cleaners and so on.

To ensure that the proportion of repeat consumers grows, Raymond is offering value-added services. One such service is "Made to measure", wherein the store representative records customers' vital statistics and communicates it to the factory.

This eliminates the need for trials and it's a job done with factory precision. A spin-off of the IT initiative is a tele-marketing venture. The company has also started sending customer representatives to the homes of top executives to display new offerings from the company.

Yesterday's staid dresser is certainly turning trendy. The question is how credibly the elderly Raymond can carry off a younger look.