Big Bazaar and the culture of always low prices has finally arrived here in India. The question is - does Big Bazaar match consumer expectations, or are they just making empty promises.
I paid a visit to the local Big Bazaar at Fatima Nagar in Pune on Republic Day. Kishore Biyani’s retail chain was having its fabled Sabse Saste 3 Din (3 Cheapest days) on that weekend. Much has been written about the Sale in Kishore’s book - It Happened in India. I decided I was going to have check out what the fuss was all about.
Sure enough, there was a line that stretched around the store with people waiting to get in. The phenomena was not limited to the Pune store and could be seen at every Big Bazaar in India. While waiting in line, a middle aged housewife asked us if we had been to the sale before. She explained to us how the store would announce impromptu deals on many items with spot discounts valid only for about an hour. She also warned us that we need to look at not only the price point, but also the deal terms very carefully (fine print). Many items had been excluded from deals - including Jewelery.
It took about 20 minutes to get in to the store. The wait was brief and there were services (chaat, snacks) outside the store presumably for those waiting. Kishore Biyani has designed his Big Bazaars around the idea of contemporary Mandi or Bazaar with grey (austere) tiling and minimal Air Conditioning. Stocks have been organized, but not hung for display. Clothes and other non-electronic items were arranged in wire-mesh boxes. As Kishore describes in the book, the entire idea of the Big Bazaar is to target the Service employed Indian. He calls this class India II, which serves the minority consuming class. This class now has a sizable spend on improving their lives. The model is based on maintaining margins and drawing customers in en-masse, enough to get the buzz going around the store and the discounts. He suggests that his stores, lighting, tiling, layout and staff are all tailored to help the average Indian be comfortable when shopping.
Once in the store, like many other customers, I focused on the items going cheap. For example, a locally made DVD player was being sold for Rs. 1,200/- against the Philips DVD player at Rs. 3,110/-. For the price-conscious consumer, the unbranded DVD player was a bargain. There were other items like the DVD player, Flash Drives and Plastics being offered under a discount.
Surprisingly, the Croma store next door to the Big Bazaar was a lot cheaper than the Big Bazaar for the same electronic items. For example, 2GB Flash Drives were Rs. 50/- cheaper than the same in Big Bazaar. Also, the same plastic containers were cheaper at the Tru-Mart. Big Bazaar seems to be employing the old bait and switch trick. Anjali, with her knowledge of how retail works says that the bait for customers are the low prices for aate-daal (or common items like Flour, Pulses, Onions, Potatoes). However, not all prices are kept at their theoretical retail minimum, which explains the Flash Drive which was priced lower at Croma.
Big Bazaar’s Marketing is definitely very savvy. Indeed, how many stores in India can boast of long lines outside the store? Their prices on the other hand leave much to be desired. I am willing to bet that the stores inventory turns are much higher than the Industry average and their margins are higher too. Their prices are therefore irrational.
Retail chains like Pantaloon’s Central, Piramyd’s and Shoppers Stops’ which serve India I - the consuming class, suffer from depressed margins thanks to rapidly appreciating real estate. Big Bazaar are relatively better off than the other chains since they target areas going for lower than premium and make better use of their floor space. Their entire strategy is to get as many people in to the door as possible. In fact, the Salesman to Customer ratio at these stores is skewed when compared to Central or Piramyd.
The appeal of low prices and bargains spans not only consumer classes but even cultures or galaxies. So, if Big Bazaar has managed to attract the masses, and convince them that they’re getting value for their money, they will only attract more of them. Walmart started with suburbs in central and southern America, but today they’re global because their promise always low prices is universally appealing. As long as they deliver on it or ensure that you don’t find out, they’re unbeatable. After all, what explains why someone like me was deal hunting at Big Bazaar?
Santosh
Anjali
14 responses so far ↓
Guerrillero // February 4, 2008 at 11:58 am
On the pic above I see a Reebok logo…I wonder whether they sell real reeboks at such bazaars.
Anjali // February 4, 2008 at 12:02 pm
They will usually have at least one branded product and one local make in every category though I’m not sure about the shoes category.
Santosh // February 4, 2008 at 12:03 pm
Guerillero, That is indeed the real Reebok.
Cheers,
Santosh
unnikuttan // February 5, 2008 at 10:39 pm
great article. i like it.
Online Shopping // June 2, 2008 at 6:47 pm
really nice article dear, keep it up
N B CHOUGULE // June 28, 2008 at 12:21 pm
I have purchase lot of glossary items from BIG BAZAAR kothrud branch on 19/06/08,bill no.T22/14321.One of the item was SAFFOLA SUNFLOWER OIL which is costing Rs120/bag ( as MRP).But same oil is available in any shop for Rs.91-98 max. Wherein you are charging for Rs.120,then in this situation your prices are higher than any other glossary shops. In that case you should ad ’sab se sasta’ it should be sabse mehenga dam’.I have asked for clarification but got very arrogant answer, pl avoid this cheating once for all.
Thanks,
Decided not buy anything from BIG BAZAAR .
I have purchase lot of glossary items from BIG BAZAAR kothrud branch on 19/06/08,bill no.T22/14321.One of the item was SAFFOLA SUNFLOWER OIl which is costing Rs120/bag ( as MRP).But same oil is available in any shop for Rs.91-98 max. Wherein you are charging for Rs.120,then in this situation your prices are higher than any other glossary shops. In that case you should ad ’sab se sasta’ it should be sabse mehenga dam’.I have asked for clarification but got very arrogant answer, pl avoid this cheating once for all.
Thanks,
Decided not buy anything from BIG BAZAAR .
dhruv // July 11, 2008 at 11:54 am
I like music n 70 mobile
Thanks
Ritesh Varma // July 21, 2008 at 4:26 pm
One cant just compare the prices of BigBazaar with any other nearby outlet …………the reason being a neighborhood shop like Croma might have slashed the prices just for that particular period of the “Sabse sasta din” announced by Big Bazaar just to be competent as far as Electronic goods are concerned …………the same thing applies to Tru- Mart………….or any other shop specialized in their respective line of business be it Consumer durable or electronics or glossary………………
The question which one need to take care is …………Is the current price of the electronic item at Croma or any other Electronic item shop stable, if yes, then since how many days or have they changed it just to be competent enough and survive in the market?
If they got a stable pricing policy then one can blame BB as not keeping prices as low as it promises. If not then one needs to understand that the neighborhood outlet will be ready to bleed to survive in front of a TIGER.
bhatia harsha // July 25, 2008 at 7:29 pm
sir, I student of T.Y.BMS i got the project on ur retail malls. i wanted to know that how u manages ur prices as u re giving consumer products at a very cheap rate.
Which type of schemes,services u provide to ur customers so that ur sales increase.
sir,plz reply.
Somika // July 27, 2008 at 4:11 pm
As Simple as this they have recently expired items and that they buy in bulk which is then thrown to you at cheapest prices and then fools feel satisfied
RUSHABH KADCHHUD // August 15, 2008 at 11:57 pm
ITS REALLY GR8 ARTICLE
BUT THOUGH INDEED THE STORE FULFILLS THE NEEDS OF MANY MIDDLE CLASS CITIZENS OF INDIA THAT THE OTHER GLOSSARY STORES CANNOT IN TODAY’S INFLATIONARY WORLD
SO RATHER THAN CRITICIZING WE SHOULD APPRECIATE THE INITIATIVES TAKEN BY BIG BAZAAR
DEMOCRATIC COUNTRY WE ARE LIVING DOESN’T MEAN THAT WE DON’T SEE THE FULL ADVANTAGES TO THE MIDDLE AND LOWER CLASS PEOPLE.
COMON GUYS DONT BE SELFISH AT THIS EXTENT ! ! !
pankaj apte // September 7, 2008 at 9:58 pm
Today I have visited Big Bazzar in Kothrud , Pune . This is my very very worst ( raddi ) experiebce in my life to visit such bad mall.
The offer are diaplyed on showcase but when you ask the counter boy said it has been ended last month only. Well another thing is the gift displyed on special sunday offer are not available & they refuse to give. I have to struggle for my sunday offer gift. The next they are pointing that we have to take the card to get the regular gift as per offers.. What the hell this big bazaar sorry BIG LOOT BAZAAR…
Long live the grocery shop for the years to come …………………
Sandeep Neve // September 26, 2008 at 10:04 pm
Big Bazaar in Pune - Fatima Nagar have very arrogant workers. I was looking for some T shirts and they were expecting me to see the T shirts only from Plastic, See the cost and buy it. I asked them, if they have any T shirts which are unpacked, So that, I can get the feel, Quality, size etc. I cannot spend 900 bugs without looking at the T shirts properly. I got vey arrogant answers from the so called Manager. Why should some one buy from Big Bazaar?
Mohan // October 22, 2008 at 11:57 pm
Quite some comments but as a matter of fact everyone has to accept them as they r true.
The home delivery of BB also is really problematic and never leave being on time but issues reg any damages will make ur days horrible and make u think y have i bought anything of that sort at BB
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