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Aug, 04 2016

Technology expanding footprints offline

The rising tech savvy young Indian population has been spoilt for choice with the recent boom in the smart phone segment. Let's unveil some new age opportunities that are burstling in this sector..

The rising tech savvy young Indian population has been spoilt for choice with the recent boom in the smart phone segment. Suddenly, mobile phone users in India have seen a lot of new brands coming in with latest technologies for better functionality and style. These newbies first captured the market through online portals by offering competitive pricing. Now they are launching their offline stores. Today, they are not only making the device available across the country at varied price points to tap the mammoth opportunity in the Indian market, they are also adopting the franchise route for a faster expansion and wider reach of their newly launched offline stores.

Many companies today are concentrating on offline stores in India as brick-and-mortar still dominates the retail landscape today. In spite to the vast reach of ecommerce that is trying to appease the customer in every way possible by imparting convenience, home delivery and easy return policies, it has somehow failed to live up to its claim to completely rub off offline stores. The fact that many online retailers and brands are opening their offline stores testifies the fact.

Gionee, Chinese smart phone is omnipresent and have well planned channels both online and offline. “We have a robust, well networked and sorted distribution channels, which has been driving impressive sales for us. Retail expansion is a prime focus area for Gionee and the brand will be spending heavily on opening new stores. Though Gionee is omnipresent and is available through multi distribution channels, Gionee has been very clear that it wants to be retail giant“, stated Arvind Vohra, MD & CEO Gionee India.

Growing Offline through franchising

The success behind physical stores is touch and feel factor. The physical retail would be more prices competitive as compared to the online retail in the long run. In addition to this, human behavior plays a crucial role as the trust factor in human dealings is higher. Moreover, exclusive products and designs are only available in physical retailers leverage. This shows physical retailers need to adapt an omni-channel strategy to keep pace with the digital retail trend. “I think consumers still like to touch and feel the product. The Indian online market is still about 20-25 per cent of the overall market, so if we want more users to experience our product then offline stores are necessary”, said Atul Jain, COO, LeEco.

Micromax Informatics Ltd had an aggressive plan after making its mark in Russia and SAARC markets. Amit Mathur, Head International Business, Micromax Informatics comments, “Russia has been one of our focus markets in the past two years and we have seen a great consumer acceptance for the brand in the market. With our focus on affordable smart phone segment, 4G and 3G, we will continue to work towards consolidating our position in the Russian market.”

Taking the opportunity of the single brand retailing being allowed in India, another Chinese brand OPPO Electronics Corp., has plans afoot to expand its operations in India. The brand has filed its application before the Department of Industrial Policy and Promotion (DIPP) – the nodal Central government agency on formulation and implementation of FDI policy as well as on retail trading. The company is planning to install around 40,000 stores (company owned and franchise outlets) in the country by the end of the year.

Likewise, Xiaomi India is officially looking to expand its offline sales in India. The company has partnered with Just Buy Live and Innocomm to expand its offline distribution network in the country. Under this partnership, Xiaomi products will be available via large-format retailers. They will also implement Xiaomi's direct-to-retail (DTR) model - developed specially for the Indian market - where they will buy from Xiaomi and supply directly to retail stores who may place orders as per demand.

“Even though our brand sells its products through the online channel, we have has always believed that a brick-and mortar presence is essential for building the brand in India. Gionee has always focused on its distribution network and service centers which have been crucial for the brand’s growth in India. At present, Gionee has about 47 brand stores and 450 exclusive service centers and Gionee plans to increase the brand stores to 250 this year”, said Vohra.

Franchise model offers faster store rollout. “We offer full ‘know how’ for setting up the store, operational guidelines as well as branding. In training, we give our products, full guidance through our sales team which will be working hand in hand with them to help increase the business,” pointed Jain.

At present, the Chinese smart phones brands that are present in India have proven their credibility. And now, braced with the best franchise roll out model in place, these brands are sure to strengthen their hold on the Indian market. 

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