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The Perils of National Customer Care

March 26th, 2008 by Devangshu Dutta

As brands and retailers expand their operations nationally, they begin to look at consolidating their back-room operations. Typically finance is already centralised, but other operations such as store opening project management, logistics etc. are also centralised for smoother and more efficient operation.

And then comes a big day when someone senior decides that the company should have a single toll-free or local dial number that customers from around the country can call.

Of course, India is already acknowledged as the call-centre of the world, so this should be easy. Right?

Wrong.

Call centres that are operating internationally from India have become famous (notorious?) for acclimatization, enculturation, liguistic training etc. of their staff. After all, they have figured, a customer in Texas is pobably much more comfortable speaking to a Sam than a Samir or to a Jack rather than a Jaikishan. And, beyond the name, they are also provided detailed background on the environment in which their customers live, so that they can have a “conversation” rather than sound as if they are script-driven phone-jockeys.

Domestic contact centre staff (and their domestic customers) are not so lucky.  The hardware may be in place very quickly and efficiently, but the softer aspects have huge gaps. Either this is because the costs are too high (compared to the revenue available domestically), or it may be because this has not even occured to the company as being as issue they should think through.

Languages and accents apart, there is a world of a difference even in terms of the way people deal with each other across India. A customer care person sitting in Chennai may have as little in common with a Punjabi customer from Delhi or a Bengali customer from Kolkata, as they might have with a Spanish-speaking customer based in Mexico.

To companies who are looking at providing single-point phone contact for consumers across the country, I would suggest looking at India just as one would look at the EU.

(For instance, a German company wanting to provide EU-wide single-number dialling would need to ensure that the calls originating from France land at the desk of a person who can speak French and is comfortable with the context of the French customer, and similarly for Poland etc. India is actually no different in its diversity.)

Acknowledging the differences and gaps would be the best first step in building true bridges with customers across the country, and providing better service.

Posted in Customer Relationship, India, Marketing, Outsourcing, Retail, Uncategorized | 1 Comment »

The Customer is God … really? – A Day of Ironies

March 15th, 2008 by Devangshu Dutta

Today is supposed to be celebrated as “Consumer’s Day”. I find that ironical, given a personal experience of poor service that occured yesterday whose effect is still lingering and will linger for another 2 weeks (with profuse apologies from 3 different people on the retailer’s side, for the delay, bad quality etc etc).

There is the saying: “Customer is King”. But it does seem that the days of kings are past.

Mahatma Gandhi went a step further and declared the customer to be God. But there may be problem with that as well – after all, how many people actually listen to God? And for all the “god-fearing” intent, how many actually act upon their morals (or their customer-service policy, in this case)?

The “God” of discount retailing, Wal-Mart founder Sam Walton, is reported to have said that the customer was the one person who could fire everyone in the company, chairman down, by deciding not to shop at their retail store. Unfortunately, many today would probably respond: “No problem, I’ll just get myself another job.”

To my mind, one of the biggest issues that causes poor customer service is the lack of ownership – someone in the retail or service organisation to actually feel that the buck stops with them, and they can take care of the problem. Much of problem lies in the processes and the structures that disempower the individual employee, but some of it is also personal conditioning.

Another key issue – transparency in approach – is highlighted in an article in today’s newspaper by Pushpa Girimaji [Advantage Consumer: Customers love transparency!]

However, how is this for another irony: the same paper presented a quote from Joseph E Levine – “You can fool all the people all the time, if the advertising is right and the budget is big enough!” Unfortunately many organisations view the consumer through this lens rather than the earlier one.

How was your day as king / god / consumer?

Posted in Consumer, Customer Relationship, Marketing, Retail, Uncategorized | No Comments »

PrimeSource Forum – Hong Kong – April 2008

March 14th, 2008 by admin

Prime Source Forum (Hong Kong) has become the ‘must attend’ annual event for the apparel industry, offering senior executives from all over the world the chance to meet and discuss current challenges and opportunities with their peers, providing also a meeting place where competitors speak freely to each other in the knowledge that many major issues can be resolved only through mutual understanding and common solutions. More than 50 senior executives from 14 countries will lead the discussions ranging over the challenges and opportunities confronting the industry in today’s changing economic and political environment.

The event will be prefaced on 31 March with industry workshops.

The main event will be opened by the Keynote address – “The World May Be Flat But the Terrain is Rough: Global Sourcing in The Next Three Years” – by Dr William Fung, Group Managing Director, Li & Fung Limited.

Devangshu Dutta, chief executive of Third Eyesight, will be moderating the panel on the emergence of brands as retailers in their own right, and the change this is creating in developed and developing markets. The panel will include

  • Shuman Chatterjee, CEO, Levi Strauss (India) Pvt Ltd

  • Edward A Gribbin, President, Alvanon Consulting Group, Alvanon, Inc

  • So Hee Kim, Editor in Chief, Malcom Bridge, Korea

  • Carlo Rivetti, Member of the Board of SMI-ATI, President, Sportswear Company, Italy

  • Fernando Urrea, President, Leonisa S.A., Columbia

  • Fritz Winans, Senior Vice President – Corporate, Global Manufacturing/ Sourcing, Liz Claiborne Inc

Devangshu Dutta will also deliver the closing summary at the event.

The event agenda is available on this page – PrimeSource Forum 2008.

For more details on the event, including registration information, please visit the event website: http://www.primesourceforum.com/

 

Posted in Apparel, Branding, EVENTS, Footwear, Lifestyle & Fashion, Marketing, Retail, Soft Goods, Strategy, Supply Chain, Textiles, Uncategorized | No Comments »

Quo Vadis Indian Fashion Industry?

March 14th, 2008 by Sharmila Katre

Fashion merchandising textbooks state – a society that is fashion aware and fashion conscious is a society that is economically healthy. Thus Fashion is a reflection of lifestyle. In the Indian context it is a reflection of the growing ‘affluence’ of urban India – the upwardly mobile Indian middle class, more so, the upper middle class. The growth and progress of the Fashion Industry in the last ten years has even warranted the institution of the bi-annual Fashion Industry event, which is eagerly awaited both by the producers and buyers of fashion in India. Every year the fashion fraternity, glitterati and media await this event with much excitement and impatience. For weeks leading up to the event one reads of the who’s who of the International Fashion scene, the top of the line buyers expected to attend the event ……and yet, when the dust settles, Indian Fashion is yet to truly make its mark on the international scene.

Internationally the Indian apparel industry is better known as a supplier of competitively priced, mass produced, ‘fashion basic’ apparel merchandise sold by various retail chains and discount stores. In design terms however, that merchandise cannot be truly distinguished from any of the other merchandise on sale in the same outlets that have been produced in other Asian, Caribbean or east European countries. So where is the uniqueness of Indian fashion/design visible globally??? And yet when India forayed into the global clothing business in the late sixties it was its design identity of unique silhouettes, textiles and value addition techniques that gave it international acceptance and demand. What sold very happily and profitably at that juncture was ‘Brand India’ through it cotton crepe kurtis and ‘drawstring pants’, and its hand block printed wrap skirts. Indian fashion laid the foundation of an industry that today employs over 35 million people and contributes 14% to the GDP of the nation.

Indian Fashion has true potential to grow exponentially in the next decade, but before that there are many issues that the creators and producers of fashion need to address.

Most importantly what comes to mind is design discipline, understanding the commercial viability of design and realizing that the business of fashion is like any business enterprise. To grow the fashion business, fashion merchandise has to reach out to market segments beyond the fashion leaders and innovators and consumers of bespoke fashion or couture apparel. Product design through design discipline should enable a product to be scalloped and extend the product’s life span to justify the cost of design development. The product line has to evolve beyond the all encompassing design technique perspective. It has to have an individual signature that has a sense of permanence and identity of ‘unique’ design like an Hermes scarf, a Chanel jacket, a Bill Blass sheath dress or a LV handbag. The signature design element itself becomes the product’s brand identity.

The Business of Fashion requires business strategies, planning, organized marketing and selling, promotion and positioning. Design research based on market and consumer feedback, lifestyle trends, market economics, raw material resources, colour palettes, textile trends and other factors need to be done in depth and in all seriousness. Fashion merchandise is highly perishable and dynamic. Product research and development needs to become an on going and continuous process, very much like the R&D processes, which are the norm for all other lifestyle products. The business of fashion too, needs to be pre-emptive, and proactive rather than reactive.  Product design needs to be clever and production friendly to ensure timely deliveries with out taking away from the design innovation factor. Market potential needs to be studied vis-à-vis the adaptability of the design/fashion content of the product to enable growth in the market share and business by straddling consumer segments. The time has come for the talented Indian Fashion fraternity to truly shift the focus to the Business of Fashion.

Posted in Apparel, Footwear, India, Lifestyle & Fashion, Marketing, Retail, Soft Goods, Strategy, Textiles, Uncategorized | No Comments »

Shopping Centres – Boon or Bane

March 13th, 2008 by Devangshu Dutta

Many people I know treat shopping centres or malls as a new phenomenon, a progressive development of recent times or a modern blot on the traditional cityscape (depending on your point of view).

However, Grand Bazaar (Istanbul, Turkey) is the earliest known mall, with the original structures built in 1464, with additions and embellishments later.

In India, if one were to include open arcades, Chandni Chowk in Delhi is reported to have opened around 1650, with its speciality shopping streets. (Of course, more traditional bazaars have been around many thousands of years around the world.)

But even if one were to get more “traditional” about the definition of a mall, possibly India’s first mall was founded in the hottest city in the country then, Kolkata (New Market) in 1874.

In more recent history, Delhi’s municipal pride, the air-conditioned underground Palika Bazar was a novelty in the mid-1980s, while Bangalore’s Brigade Road saw several early pioneers with their shopping arcades in the late 1980s.

Then came the mall-mania beginning with Ansal Plaza in Delhi and Crossroads in Mumbai. Everyone started looking at malls as the new goldmine, being pushed ahead by a “retail boom”.

The early stage of any such gold rush usually has several experiments missing their mark, which is what has happened with the hundreds of mall-experiments that have been launched in the last 7-8 years.

Some of the significant and common issues are starting to be addressed, but many others remain.

Catchment-Based Planning is Needed

The top-most issue in my mind is “oversupply”. While this may sound absurd to many people, given the low figures quoted for modern retail, I am referring to the over-concentration of malls in a small geography. If 8-10 malls open 4-5 million sq. ft. of shopping in a catchment that can only support 1 million sq. ft., everyone knows that some of the malls will fail. But everyone also believes that their mall will succeed (otherwise, they would obviously not have invested in the mall).

What happens to the malls that fail? Depending on the design of the building, many of them can be repurposed into office space – another area where a lot of investment is still needed. So in the end, actually, most people win, one way or the other. Yet, there will be some losers. Does anyone “plan” on being one?

The second key issue in my mind has been that mall developers have been thinking as “property developers” rather than retail space managers. The successful shopping centre operators worldwide (now also in India), are actually as concerned about what and who is occupying that space as a retailer would be. They are concerned about the composition of the catchment, the shopping patterns, the volume of sales, the shopping experience. Therefore, the tenant mixes as well as adjacencies are factored into the earliest stages of planning the shopping centres.

In fact, if I were to identify the most critical operational problem for many of the malls, it is the lack of relevance to catchment and, therefore, the low conversion of footfall into sales for the tenants other than the food-courts. Customer flow planning within the mall is another factor that can make a tremendous impact on the success and failure of the tenant stores.

Once you start looking at these factors during the planning of a mall, another obvious aspect that jumps out is “differentiation”. Currently, there is little to choose from between malls (other than possibly the anchor store). However, with more clarity in terms of the target audience, the potential strategies for differentiation also become clearer. The visitors also become segmented accordingly, and there is a natural benefit to the tenants occupying the mall.

If, as a mall operator, you want to be in business for long, and also develop other properties in the future, the success of your tenants is probably the most critical driving factor for your business.

Integration into the Urbanscape

When we gauge malls from the perspective of integrating within the urban landscape, there are obviously some glaring errors being made. Instead of aesthetic design that reflects the heritage and culture of the location and its surroundings, or some other inspirational source for the architect, most malls that have come up are concrete and glass boxes.

Beyond the looks, some of the malls are a victim of their own success. They attract more crowds during the peak than they have planned for. Not only does the parking prove to be inadequate, there is no holding capacity for cars entering or exiting the mall. The result is a traffic nightmare – not just for general public, but even for the visitors to the mall. Someone who has spent 45 minutes stuck in a jam waiting to get into the parking of a mall will certainly not be in the best frame of mind to buy merchandise at the stores occupying the mall.

Some of the problems lie outside the mall-developer’s control – for instance land costs are a major driver of the cost of the project (and, therefore, the lease costs to the tenants), and land is a commodity which is independent. Real estate is available within the cities as brown-field sites (former industrial locations), but the regulations are convoluted and the strings are in the hands of too many different departments of the government (city, state and central). This needs joint creative thinking on the part of developers, the government and the public, if our cities are to develop in a more sane fashion than they have in the past.

Similarly, land deals are still not clean enough for foreign investors to be comfortable participating in many developments. This obviously is holding back a tremendous source of capital and domain expertise that could contribute to the growth of this sector.

Many other operational issues exist – manpower, systems, health & safety – some of them can be managed or controlled by the mall developers, and it is a question of time (and of their gaining experience). Other issues are more in the domain of the government, and need a visionary push to make “urban renewal” a true mission.

New Life for the Cities

In my opinion, one of the most interesting areas which would be in the joint interest of almost all parties (that I can think of) is the possibility of revitalizing the high streets and community markets, and reinventing them as the true centres of shopping.

Many of our markets are rotting (a strong word, but let me say it anyway). The individual stores are owned by individual owners who are not all equally capable of maintaining the same look and feel throughout. The infrastructure in and around the markets are owned or managed by several different agencies. To make matters worse, there is often no cohesiveness and no synergy in the interests of most of the members of the market association. None of these individually have the power or the mandate to recreate the shopping centre. But what if they could get together and take the help of a re-developer?

If an example is needed, New Delhi’s Connaught Place provides the example of one stage of redevelopment. Connaught Place had lost its pre-eminent position as a shopping centre, due to the spread of Delhi’s population and the new local markets that had come up. Further disruption was caused by the construction by Delhi Metro. But DMRC has reconstructed an “improved” centre, and the Metro connectivity has made the customers come back into CP, as it is affectionately known in Delhi.

There are clearly many such opportunities around India’s cities. These need to be looked at as a commercial opportunity for all concerned (revenue for the redeveloper, better sales for the store owners / tenants, more tax revenue for the government from additional sales and consumption). But it is also a broader social opportunity to breathe a new life into our cities, and to make them proud beacons of a growing India.

It would be a mission that would truly prove the worth of shopping centre developers, urban planners, regulators and the retailers themselves.
Any takers?

Posted in Apparel, Branding, Consumer, Food & Grocery, Footwear, India, Lifestyle & Fashion, Luxury, Market Research, Marketing, Real Estate, Retail, Soft Goods, Strategy, Textiles, Uncategorized | No Comments »

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