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Quality gadgets, and here in India. Each with its own USP.

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Nearly twice as many Indians travel abroad annually compared to about 3.5 million foreign tourists visiting India. Yet, in a departure from the past, the shopping list of Indians touring overseas isn't all that crowded with the latest gizmos and gadgets, if the orders placed with the specialty stores flourishing within the country are any indicator.

"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.

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Upclose E-Zone’s Manoj Kumar thinks customers need to get a touch-and feel experience

"The competition right now is fragmented with different players coming in, while we have scaled up as a national player," says E-Zone CEO Manoj Kumar. E-Zone is being positioned as a store where you can experience a product from a toaster to LCD to home theatre. "At any given time, we have around 100 TV sets and 40 LCDs on display. There's even a kitchen demo area—for customers to touch and feel the gadgets," says Kumar.

Most of the stores are investing in staff training to guide the customers but not hard-sell. Says Ajit Joshi, CEO of Infiniti Retail, the consumer retail arm of Tata Sons: "The philosophy at Croma is that we don't sell, we help you buy, thus ensuring that every customers is totally satisfied." With Croma, Infiniti Retail has entered into technical and sourcing agreement with Woolworths Ltd. The Australian company, through its Indian entity, provides not only all the products but helps in designing the Croma stores too. The target is to reach 100 stores by 2011.

As is the trend, E-Zone too receives a lot of queries for products ahead of the global launch. Says Kumar: "Cost will always be a factor but not for those who want to experience a new gadget. Given the demand, we also provide exchange offers and also have our own company for consumer financing: Future Money."

Several other specialty stores are offering consumer financing and exchange programmes to break through the old Indian aversion to discarding familiar gadgets. "As new models keep coming frequently—in the case of electronics goods and cellphones 5-10 new versions every year—we provide for the exchange programme. It constitutes close to 10 per cent of our sales," says Setty.

Assisted by three generations of family members, Setty is keeping pace with changing demands as "today the customer is not only more knowledgeable about the market but also techno-savvy. They are constantly upgrading in all segments and buying the latest." The specialty stores at any given moment have anywhere between 5,000-6,000 products, costing anything from Rs 50 to Rs 10 lakh. They take pride in having at least 3-4 new products on display every month in every section of the store. So whether it is the new MP3 player or the latest MK3 music system or digital cameras with new features, or a wireless system for the house that can be played on television, these upmarket stores are ready to cater to gizmo collectors.

In terms of space, Reliance Digital is pushing ahead with mega specialty stores of 15,000-35,000 sq feet to provide an exhilarating shopping experience. Though only one of Reliance Digital's proposed 70 outlets is operational as yet, the store at Shipra Mall on the outskirts of Delhi is witnessing a high buyer response with around 10 per cent conversion of footfall. As Ajay Baijal, president and chief executive Reliance Retail, puts it, "The idea behind the Reliance Digital store was to exploit the opportunity in the consumer electronics/IT/telecom/ household appliances category where there were hardly any stores catering to the requirements under one roof in a customer-friendly atmosphere." The second Reliance Digital outlet opening next month in Gurgaon is expected to be spread over 35,000 sq ft and will have a special section devoted to kitchen gadgets and other custom-built solutions.

E-Zone is meanwhile striving to "stimulate the five senses" with its large-store formats of 8,000-15,000 sq ft—a departure from its value stores Electronic Bazaar at the Big Bazaar outlets. So while price-sensitive shoppers still have Electronic Bazaar, the specialty store concept, launched in April '06 by Future Group's Home Solutions Retail (India), is targeting high-end product seekers.

Stung by the increasing competition from standalone neighbourhood stores, which too are jazzing up the interiors and increasing stocks on display, chain stores have started offering after-sale service regardless of the product brand, a niggling issue long overlooked. They are also packaging special services for customers with a limited budget. "We take consumer complaints seriously," says Infiniti's Joshi. "Not only do we help corporates in selecting gifts when buying in bulk, we help budget customers configure the best options, including for PCs," says Infiniti's Joshi.

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FoneNext Exchange offers help customers upgrade to newer cellphone models

Doing away with the system of staff commissions to check any attempt to push sales, Croma is providing consultancy at home for measuring the area and recommending a suitable TV, for best viewing experience. Even cookery classes are organised in the stores in tie-up with various appliance manufactures.

So even as specialty stores are investing in appearance, ambience and services, particularly special offers, the average consumer is able to not only enjoy the luxury of seeing the latest gadgets at close hand without taking a trip overseas, but also bargain for a better price elsewhere. "But," as Setty puts it, "consumer electronics has largely serious buyers. They come well prepared, more so if it's an expensive purchase. Then it is a family decision and not impulse buying." So while the well-heeled splurge on their love of gadgets, the average customers may well find the specialty stores as a representation of a family outing—with scope for bargain hunting.

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