1.

BIG BAZAAR-THE ROUTE TO THE INDIAN MASS MARKET

“Jo bazaar mein milta hai, who sab yahan milta hai”
2. INTRODUCTION

o Introduced by Pantaloon Retail (India) ltd in 2001.

o First store was opened in Kolkata and then with in 22 days other stores were opened in
Hyderabad & Bangalore
o In 2006-2007, 27new stores were launched in 22 cities.
o By May 2008, 89 Big Bazaars spread across country.
3. Pantaloon Retail (India) Ltd. Background

o In 1987, was incorporated as Manz Wear Private Limited

o In 1991, became Public Limited and was renamed Pantaloons Fashions (India)
Limited
o In 1999, was again renamed as Pantaloon Retail (India) Limited
o 1987-1993, launched three successful brands – Pantaloon trouser, Bare denims and
John Miller Shirts
o 1994-1998, the company introduced the concept of the Pantaloon Shopee, an exclusive
men’s wear retail store
o In 1997, company moved to large format lifestyle retailing by opening Family Store
4. THE STRATEGY
To offer value to the customers
As the store would offer a large mix of products at a discounted price, the name Big Bazaar was finalised
Price was the basic value proposition at Big Bazaar
Prices of the product were 5 to 60 lower than the market price.
5. Selecting the Right Location

o They opened stores within the city

o They took land on lease for a period of 12-20 years. The rentals varied from Rs.30 per
square foot to Rs.50 per square foot, depending on the city and location.
6. The Merchandise Mix

o Big Bazaar stocked about 1,30,000 items in over 20 product categories

o The classification was done in terms of apparel and non-apparel
o In the first year, apparel accounted for 70% of the off-take.
o The price ranged from Rs.99 to Rs.799
o Non – apparel included plastic items, footwear, toys, luggage, and stationery. It
accounted for 30% of the off-take in the first year.
o Also launched Food Bazaar in the first year of operations.
7. Pricing Strategy

o Value Pricing and maintenance of good quality were the key factors influencing the
pricing decision.
o Price that will offer value to the customer was first determined.
8. Food Bazaar

o Launched in 2002 and it was modeled on Indian mandi.

o Processed Food & Non Food ( contributed 60%)
 o Dry Staples (contributed 30 %)
o Wet Staples (contributed 10%)
Company Launched:

o Food Bazaar Masalas

o Food Bazaar Tea
o Premium Harvest Pulses
While apparel still continues to be the largest selling category at BB, (40%)but the share of the food sale has
increased rapidly to 25.74%
9. Managing The Supply Chain

o Distribution is decentralized.
o Warehouse attached to each store.
o Initially, the stock turnover was three month which is now down to two month.
10. Organization Structure of Big Bazaar

o Structure is flat in nature

o Division are apparel, non apparel and the new business division which include gold,
footwear and the shop in shops.
o 1800 people work for Big Bazaar directly.
o Another 400 people for support and ancillary services.
o Training program for new employee.
o Evaluation is done every six month.
11. Encouraging Loyalty

o Launched the Big Bazaar ICICI bank co-branded credit card.

o On purchase of Rs. 1500 or more, customer has the option of making payment by three
EMI with out any charges.
o For every Rs. 100 spent on shopping, 4 reward points are rewarded
o Free home delivery to card holders.
12. CONCLUSION

o As most of the retail industries did market research before entering into market same
thing was done by big bazaar. Location, market, consumer perception analysis was done was done by
big bazaar. In one year much more diversification was done in it. And to retain customers they use
many loyalty programs and I.T. techniques were used.
K ishore Biyani was in unfamiliar territory in 2006-2007. He had
written a book, It Happened in India, and was evaluating publishers.
He was in talks with a couple of publishing houses who wanted to
work with him. But they told him that they would do a print run of
10,000 copies and price the book at Rs. 199. Biyani balked at the
suggestion. Now, Biyani is not a man who thinks small. His Big
Bazaar chain caters to lakhs of Indians who love a good bargain.
Biyani wanted all these consumers to read his book. He knew that
there was no way these people would pay Rs. 199 for a book. And
10,000 copies? Were they joking? He wanted a publisher who
thought as big as him. Enter Rupa Publications’ Managing Director
Kapish Mehra. 

Rupa and Biyani reached an agreement. The first print run was two
lakh copies. The book was priced at Rs. 99. 

It Happened in India sold over three lakh copies. “Typically we look at

books that can sell us a lakh of copies,” says the unassuming Mehra
sitting in his office in Delhi’s Daryaganj area, “when we see that the
content is right and the target audience is clear.”

Mehra knows his market: The growing number of people who want to
read English books. English has always been a language for
business communication in India. Now it is also gaining popularity as
a general purpose language. Everyone from drivers, watchmen and
house maids want to speak the language. “Everybody wants to speak
in English as it adds to their skill set. Over the years we feel that the
need to speak in English is only going to grow and this can be seen
from the growth of our students,” says Aslam Moosa, CEO,
Speakwell Academy. Speakwell has experienced a 100 percent
growth in the number of students over the last five years.

Rupa celebrated its 75th anniversary in August 2010. It is the largest

player in India, releasing over 250 books a year. It boasts of having
Sunil Gavaskar’s Sunny Days and Anurag Mathur’s The Inscrutable
Americans in its stables. 

But it was in 2004 that Rupa really hit it big with Chetan Bhagat’s
Five Point Someone. The book rewrote the rules of the publishing
industry in India. An English book was considered a bestseller if it
sold 10,000 copies. Five Point Someone and each of the other books
he wrote sold a million. Priced at Rs. 95, it negated the threat of
piracy. 

How does Rupa do it? There are three key factors that help Rupa sell
so many books. The first one is a very strong distribution chain.
Mehra has a tie-up with A.H. Wheeler, the railway bookstore chain
that has outlets across the length and breadth of India. His books are
also sold at book chains like Crossword and Landmark. “Rupa has
fantastic distribution, experience and a great gut feel of the market
and are the big reason behind my success,” says Chetan Bhagat.

The second one is the price point. Mehra’s consumers expect to pay
a certain price and that is the price at which he sells. And the number
of people who buy his books from tier II and III towns is increasing.
Thirty five percent of his sales are in places like Gorakhpur and
Kolhapur. The remaining 65 percent are sold in metros like Mumbai
and Delhi. 

The third factor is volumes. Mehra bets on quantity to create a

market. “Book sales are increasing. And Rupa is doing something
right to expand the market. They understood at what price barriers a
particular book can work and this is not easy,” says Himanshu
Chakravarti, chief operating officer, Landmark.

But how can he afford to price his books so cheap? Does he

compromise on paper quality, artwork for the cover etc.? In response,
Mehra dumps a bunch of Rupa books on the table in front of this
reporter. Mehra then gets books from other publishing houses and
challenges him to find the difference in quality. He can’t. 

Rupa has been growing at 50 percent for the last three years against
an industry average of 30 percent. In an industry where figures are
notoriously hard to come by, Rupa has a hit rate of 7 percent. That
means out of every 100 manuscripts that come in to it, seven get
published. It gets around 60 manuscripts in a week.

Read more: http://business.in.com/article/work-in-progress/rupa-the-
paper-tiger/17642/1#ixzz17oJlif00