Consumer Behaviour in Big Bazaar

Options: Consumers are more likely to choose an alternative after a relatively inferior
option is added as a choice. For example, Simonson says, participants in one study were
given a choice between $6 and an elegant Cross pen. A second group chose among $6,
the same Cross pen, and a second pen that was clearly less attractive than the Cross pen.
As was predicted, the addition of the unattractive pen increased the share of the Cross pen
at the expense of the $6.
Alternatives: Consumers prefer alternatives that are compromise choices. Given a choice
between two alternatives, one priced lower than the other, the addition of a third choice,
priced higher than both, will increase the market share of the more expensive of the
original two. This finding suggests that companies can increase their overall sales and
shift purchases to higher-margin items by carefully designing the sets of alternatives that
their customers consider.
Floor Displays: Buyers are averse to choosing the lowest-quality alternative in sets of
three or more choices. One of the implications of this finding is that marketers of wellknown,
high-priced brands should encourage retailers to organize floor displays by model
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type, whereas marketers of lesser-known, lower-priced brands should prefer organization
by brand.
Brands: Consumers who think about the possibility that their purchase decisions will be
wrong are more likely to choose better known brands. In a test case, Simonson showed
that consumers debating between a better known, more expensive brand and a lesserknown,
less expensive brand expect to feel greater regret if they err by choosing the
cheaper option. Indeed, after thinking about the possibility of regret, consumers were
more likely to select the better-known brand. Kodak film has capitalized on this finding
with an advertising campaign that asks consumers to consider how they would feel if they
bought cheap film and their pictures didn't turn out.
Preferences: Consumers tend to select variety when buying multiple products for
consumption at a later time. In each of three weeks, Simonson asked a group of
respondents to select one of six familiar snacks for immediate consumption. A second
group was asked to pick three snacks -- one for immediate consumption and one for each
of the next two weeks. Both groups were told that they could pick the same snack as
many times as they wished. Those in the first group tended to select the same snack all
three times, whereas most in the second group selected three different snacks.
Product Modifications: Modifying a product with a feature or premium that is of
little or
no value to the consumer, even without raising the price, may actually decrease sales.
When consumers are uncertain about their preferences, a product that offers an unneeded
add-on (such as an offer to purchase a Pillsbury Doughboy collector's plate) provides
them with a reason for rejecting it.
While marketing professionals can use these findings to influence consumer decision
making, consumers, too, can benefit by understanding their own behavior. "One of the
points of our research is to inform consumers about some of the factors that influence
their decisions," Simonson says. "With such knowledge, they may be able to make better,
more thoughtful decisions."
Big Bazaar: Brand Extensions Actually Made & Future Possibilities
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Future Group is planning to split Big Bazaar into two entities. One will be front-end
consumer-oriented entity and other will be for back-end operations. Back-end entity may
enter into joint venture with leading international cash and carry retailers. Foreign
partners like Carrefour, Metro, Costco, etc., are in the race, and their role will be to
improve efficiency in sourcing and logistics, which will help drive down prices and boost
margins.
The front-end operations will be further divided in three categories, Big Bazaar
Express
with store area less than 40,000 sq. ft., Standard Big Bazaar with store area between
40,000 to 75,000 sq. ft., and Big Bazaar Supercentres with store area more than
75,000
sq. ft. . Future Group is also planning to distribute financial products like consumer loans
and insurance through Big Bazaar outlets.
BIG BAZAAR: Positioning & Establishment
Big Bazaar has established itself in the first quadrant of Organization Value and
Customer Value Matrix. Big Bazaar elaborates the core competencies and areas of
improvement. The key features that have shaped in establishing of brand includes: -
Big Bazaar ensures that no other kirana store / departmental store are offering
considerable discount compared to its own price. This helped Big Bazaar in being
the "value for money" store.
Big Bazaar scores high on product mix as compared to kirana store.
Cheap and local products are heavily stocked in Big Bazaar which make it easier
to attract lower middle class category of customers.
Promotion of kirana is rare event but Big Bazaar used this channel efficiently to
establish itself as national brand.
Customer loyalty resulting in high up sell, i.e., selling to existing customers.
Big Bazaar refrains from high-end locations for business which reduces its rental
budget and provides competitive advantage over competitors. Kishore Biyani has
taken "early movers advantage" in many retail spaces.
Customer Satisfaction is Big Bazaar
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The degree of customer satisfaction you deliver determines the level of long-term
success you will achieve in business.” - --- Training Mantra for Sales Force”
Don't just make sales. Create customers - satisfied customers”. In addition to the
immediate profit they provide on the first sale, satisfied customers help you build
your business in 2 other important ways:
1. They become a reservoir of repeat buyers. For some businesses that means repeat
buyers for more of the same product or service. For every business, it means
buyers for additional products and services.
2. They automatically refer more business to you from their friends and business
contacts. This is highly profitable business for you because it doesn't cost you any
time or money to get it.
Never make any promises you can't (or won't) keep. Nothing alienates customers faster
than getting something less than they expect from a business transaction. They
won't do business with you again. And they will tell everybody they know about
their unhappy experience - causing you to lose future customers.
"Over deliver" on quality and service. Always exceed your customers' expectations. You
will win their long term loyalty. It also makes it difficult for competitors to steal
customers from you - even if they have lower prices. Customers will not risk an
uncertain experience with a competitor when they know they will get more than
they expect from you.
Let your customers know you are always thinking about them. Communicate with them
regularly. For example, create some special deals just for your existing customers.
And announce new products or services to them before you announce them to the
general market. (Tushar Ranjan Kantha
Consumer Insights & Perceptions
20
Big Bazaar is based on 3-C theory of Kishore Biyani. The 3-C symbolize Change,
Confidence and Consumption, and according to this theory, "Change and confidence is
leading to rise in Consumption". They divided Indian customers in three categories: -
India One
Consuming class, constitutes only 14% of Indian population.
They are upper middle class and most of customers have substantial disposable
income.
Initial focus of Big Bazaar.
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India Two
Serving class which includes people like drivers, house-hold helps, office peons,
washer-men, etc.
For every India One, there are at least India Two and have around 55% of Indian
population.
India Three
Struggling class, remaining population of India.
Cannot afford to inspire for better living, have hand-to-mouth existence.
Needs cannot be addressed by current business models.
The potential customers of Big Bazaar are India One and India Two. The customer
insights are developed by close observation of the target set. The insights that came out
are: -
The clean and shiny environment of modern retail stores creates the perception
that such store are too expensive and exclusive, and are not meant for India Two.
India Two finds moves and find a lot of comfort in crowds, they are not
individualistic. They prefer to be in queues.
Indian-ness is not about swadeshi, it's about believing in Indian ways of doing
things.
Indian customers prefer to purchase grains, grams, etc., after touching them, so it's
better not to sell in polythene packs. Big Bazaar has counters where you can touch
wheat, rice, sugar, etc., before purchasing.

BIG BAZAAR AT GURGAON

Today, housewives and compulsive shoppers in Gurgaon need not step elsewhere for
shopping. With Big Bazaar, the hypermarket (discount store) from Pantaloon Retail
(India) Ltd. opening its first outlet in North India, they have a lot to choose from. Spread
over an area of around 50,000 sq ft, Big Bazaar offers a variety of products 2% to 60%
lower than the corresponding market price. After consolidating its position in 4 cities –
namely Hyderabad, Kolkata, Bangalore and Mumbai (Lower Parel and Mulund), Big
Bazaar is all set to win t! he hearts of people in Delhi and Gurgaon.
Speaking at the launch, Mr. Kishore Biyani, Chief Knowledge Officer, Pantaloon Retail
(India) said, "The Company was the first in India to launch a hypermarket discount store
- Big Bazaar. Seeing the tremendous response, today we are pleased to bring the same
excitement to shoppers in and around Gurgaon in the form of Big Bazaar with its variety,
discounts and shopping ambience. The main attraction at Big Bazaar is the product
variety. The company will stock about 1,70,000 items. In short, there is something for
everyone."
Big Bazaar has apparel and accessories for men, women and children besides Cosmetics,
Toys, Home Needs, Household Appliances, Gift items, Jewellery, Luggage, Linen, and a
lot more.
Food Bazaar, with an area of around 10,000 sq ft is also a part of Big Bazaar offering
products at wholesale rates below the MRP. To attract regular bazaar-goers, a mandi has
been created within Food Bazaar where Consumers could touch, feel, pick & choose
products. This choice has been supplemented by the provision of packaged food for the
Westernized shoppers. Food Bazaar will stock around 10,000 stock keeping units
(SKUs). These will include provisions, vegetables, fruits and fresh produce, FMCG
products, bakery products, basic staples, cereals, pulses, cooking oils, flour, spices, dry
fruits, health food, baby food, dairy products, drinks, beverages as well as ready-to-eat
and ready-to-cook product! s. There are special purchase offers and discounts worked out
with several leading brands exclusively for Food Bazaar customers making shopping at
Food Bazaar highly affordable.