"The globe-trotting Indian is getting increasingly market-savvy—in fact, 65-70 per cent of our clients have converted from buying overseas," says Vinod Moorjani, head of Gizmo World, a specialty electronic store in the capital. "They still window-shop overseas for the gadgets and products they would like to acquire, but no longer want to buy from the US or Dubai. They come back and place orders here for whatever they would like to acquire," he adds.
The purchase from domestic shops has its advantages now. As Moorjani points out, buying a product from a specialty store in India comes with warranty and assurance of after-sale service for a high-value product. And the cost variable, market veterans state, is marginal. "All major companies—Philips, Sony or Samsung—are simultaneously launching and releasing their products in India," says B.A Kodandarama Setty, head of Vivek Ltd, a family-held company that has 53 stores spread across Tamil Nadu and Bangalore. "This is unlike 15 years ago when the Indian market was lagging behind by several years in the type of products available." The acquisition route has also enriched Vivek Ltd with 28 smaller-format Premier and Jainsons chain of stores.
It is not just Indian companies that are finally waking up to the potential of the domestic retail market. Many foreign majors like Wal-Mart and Australia's Woolworths have entered the scene through the joint venture route. A.T. Kearney's annual global retail investment report of 30 emerging markets has pegged the Indian retail market at over $350 billion, registering a double-digit growth. According to Kearney's 2007 global retail development index, India is on the top with 25-30 per cent growth vis-a-vis 13 per cent in both China and Russia.
The global investors, the report says, are eyeing countries new to modern retailing, smaller cities (as larger cities get saturated) and customers hungry for specialty products. In a market where swanky electronic specialty stores are springing up with unmatched regularity, and corporate giants like Tata, Reliance and Videocon are lining up ambitious plans for a pan-India presence, companies like Gizmo World operate on the strength of their reputation and customer loyalty. Gizmo World was forced to shift operations due to a sealing drive, but it still has a dedicated clientele in the 25-45 year age group. And that includes celebrities, fashion designers, industrialists and ministers. Sourcing products mostly from Hong Kong, where it has an office, Gizmo World seems to operate more though word of mouth than product display in its showroom. The store has a long list of regular customers who book their orders for the latest gadgets—many even before their global launch.
On its order books for 2008 is the much-awaited world's smallest and thinnest LED pocket projector (just 400 gm), Sony's new AIBO (robot dog) coming after five years and the hottest surface tablet PC from Microsoft, which is operated with sensors and cameras. Cost being no consideration for some of the buyers, there are already enquiries for LED panels of 10-mm thickness and 20 inches size. The Gizmo World model of specialty store is quite in contrast to the razzle-dazzle and vast spread of Tata Group's Croma, or ril's Reliance Digital, Future Group's E-Zone, Vivek's down south or even Next Retail India, Videocon Group's consumer electronics retailing arm with the largest chain of 270 stores spread across the country.
With an eye on the GenNext crowd, Next Retail India earlier this month acquired Planet M, the music and entertainment retail chain with 150 stores specialising in home entertainment tools and console games. Targeting a turnover of Rs 2,000 crore by the next year, Next Retail has plans of adding 500 more stores over the coming 18 months with an investment of Rs 1,000 crore.
Spread across around 5,000-10,000 sq ft space, Next Retail stores stock not only their own Videocon brand but also other major ones like Electrolux, HCL, Hyundai, LG, Nokia, Onida, Kelvinator, Kenstar, Philips, Sahara, Samsung, Sansui and Toshiba to offer consumer durables ranging from AC, LCD and plasma TVs, home theatre systems to home appliances. Despite a surge in the number of players, most in the electronics specialty stores claim they don't see it as competition, as their USP ranges from special displays to the seemingly limitless product range and after-sale services—not to speak of ever-increasing store size.