“The Boom and Doom in daily markets”. Presentation on “Why shoppers prefer limited brand variety in Kirana Stores over huge brand variety in supermarkets?” gave me an opportunity to do an in-depth study on traditional & modern FMCG retailers. The study is based on research upto year 2011.
1. Why shoppers prefer limited
brand variety in Kirana Stores
over huge variety in
supermarkets?
Ridhi Luthra
70183
2. FMCG Industry
Category Breakup
Max. 53% Food &
Beverages
Modern Retailer
Traditional
Retailer
FMCG popular Indian
companies
ITC, Amul, Cadburys, HUL,
Nestle, etc.
Store Ambience
Locally present,
hence convenient
Indian FMCG sector
(2009)
US$ 25 billion (Rs. 120,000
crore)
Brand Perception
Good Customer
Loyalty
Huge product
offerings
Amazing services
Price Points
Quality products
Promotions
Price Points
FMCG characteristics
(consumers)
Frequent purchases, low
price, low involvement
FMCG characteristics
(marketer)
High volumes & STOs, low
margins, extensive
distribution network
Growth drivers
(demand side)
Consistent GDP growth,
increased income, etc.
Product Availability
Growth drivers
(supply side)
Retail growth, low labor cost
Store Staff Service
3. Understanding
the pulse of the
customer
New products
launched are
first available
at Kirana
Stores
“Do you
have eggs?”
High degree of
replenishment
Overall
service level
4. •
Consumer Survey & Retailer’s Interviews done within the area of 1-2 km of
Greater Kailash, South Delhi.
•
People of all ages, gender, and income were questioned about their purchasing
behavior for FMCG.
•
Kirana stores chosen are Rohit stores and Mehta Stores
•
For the supermarkets, Star Bazaar (only 1 store) and Big Apple (more than 30
stores) have been chosen.
5. Hypothesis
Research
Objectives
I agree, Kiranas offer
similar brand variety
like supermarkets with
personalized services.
Variables
To study the consumer
behavior shopping for
FMCG considering
various factors like
price, discounts,
services, location, etc.
Product
Brand
Price
For sure, new product
availability and
replenishment services
are made earlier in
kiranas than
supermarkets.
To analyze which
format (traditional/
modern) is preferred
by the shoppers for
FMCG and for what
reasons.
To understand the
supply chain
management system
of kirana stores and
supermarkets.
6. Sample Size – 25 consumers
Where do you usually go
shopping for FMCG?
Are you loyal to some
particular FMCG brands?
Other
Hypermarkets
32%
Yes
Supermarkets
No
68%
Kirana stores
0
5
10
15
20
0% If no, then where do you usually
Do you change your FMCG brands due
to changes in prices?
look for new brands?
14%
No
Kirana stores
Supermarkets
Hypermarkets
Yes
Other
0
5
10
15
20
86%
7. Rank (1-7) as per your priorities considering various
factors for Kiranas
8
7
6
5
4
3
2
1
0
Brands
Availability
8
Services
4
Series1
Pricing
6
1
Convenienc Convenienc
Discounts/
e (parking/
e (small Trust/ Loyal
Schemes
traffic)
packs)
2
3
5
7
Rank (1-7) as per your priorities considering various
factors for Supermarkets
6
4
2
0
Brands
Availability
Series1
Pricing
Services
1
5
3
Convenienc Convenienc
Discounts/
e (parking/ e (small Trust/ Loyal
Schemes
traffic)
packs)
7
6
2
4
9. Kirana Stores
Working more than 12 hours daily
Supermarkets
Working more than 12 hours per daily
Daily footfall: between 50 – 400 people Daily footfall: between 400 - 1000 people
Basic products available of popular
brands
(4600 products)
Wide range of products and brands
available
(15,000-20,000)
Price range variation: Rs 5 - 500
Price range variation: Rs 5 - 1000
Employees: uneducated; less than 10
Owner handles the store
Educated employees, above 25
Store manager handles the store
Services – free & any quantity odd
hours delivery, credit system
Services – home delivery (Min. Rs 500)
Trolleys at store level
Distributors supply
FMCG company to warehouses to stores
Company based schemes & discounts
on monthly bills
Company based schemes and store
promotions
10. Kirana stores: more
organized, product
offerings, systematic and
advertisement
Sample size is only 25
consumers & zone
selected is G.K., South
Delhi
Supermarkets: require
personal touch, better
location, small packs &
products availability
Sabka Bazaar store
manager refused to give
interview due to
company policies
