SUMMER TRAINING REPORT

A STUDY ON EFFECT OF SHOPPING MALLS ON CONSUMER BEHAVIOUR WITH RESPECT TO MBD NEOPOLIS

In partial fulfilment of the requirements for the award of the Degree of

MASTERS OF BUSINESS ADMINISTRATION (Retail Management) (2010-2012)

Submitted by: HARKIRAT SINGH Roll No. :13014

UNIVERSITY INSTITUTE OF APPLIED MANAGEMENT SCIENCES

PANJAB UNIVERSITY , CHANDIGARH.

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ACKNOWLEDGEMENT

I would like to thank Mr. Nayak, Human Resource Head, MBD NEOPOLIS without whom this internship would have not been possible. I am grateful to him for taking time off his busy schedule to guide and support me throughout my training period. His thoughtful insight will always cherish in my memory.

I am also grateful to MBD NEOPOLIS for giving opportunity to work with them and help me make the best out of internship. I sincerely appreciate the support and co-operation of the employees and staff that I experienced for two months internship.

I thank my internship co-ordinate Mr. Amandeep Singh Marwaha for having given me opportunity to put into practice the, theoretical Knowledge that I imparted from the program

TABLE OF CONTENT
S.NO. CONTENT PAGE NO.

1.

EXECUTIVE SUMMARY

2.

COMPANY PROFILE

3.

MALL REVIEW

11

4.

DEPARTMENTS

14

5.

RETAIL INDUSTRY

26

6.

SHOPPING MALLS Advantage Disadvantage TYPES Objective

30 31 32 43

7.

8.

Analysis

46

9.

Conclusions

55

10.

ANNEXURE 1: QUESTIONNAIRE REFRENCES

56

11.

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EXECUTIVE SUMMARY

Mall management has been identified as critical factor for the success of malls and the retail industry across the world. The mall culture offers everything under the one roof, even in Tier II and Tier III towns are powering the retail revolution. Comfort, style, convenience and cool are only some of the words used by the shoppers introduced to the mall culture.

Malls focuses on providing a good shopping experience to the customers to earn the patronage of the customer. Thus for the mall developers and for mall management team the convenience of the customer becomes the major touch point and hence has to be managed excellently to create an everlasting impression on the minds of the customer.

The following report covers the various aspect of the mall like mall operations, standard operating procedure, catchments area and positioning of mall and also covers the report of back office and topic which I chose for my internship report i.e. Customer Relationship Management. It also provides a SWOT analysis of MBD Neopolis and the key finding of the report.

COMPANY PROFILE

The MBD Group is Indias largest publishing house with more than four decades of experience. The MBD Group under futuristic vision of Mr. A.K Malhotra, Chairman and managing director, has diversified into various industries including paper manufacturing ,hospitality, real estate, mall development and management and elearning. It is the only publishing house in India with complete background and forward integration, right from self owned paper manufacturing unit to editing, designing, typesetting, offset printing, binding and reaching readers through its own distribution network with more than 32 offices all across India. MBD Group has nearly three thousands employees, a network of around 1000 distributors and group which publishes books for all classes, all subject s, all languages, all educational boards in India and in most of the major languages spoken world wide.MBD already have more than 8000 titles currently under the MBD brand and are increasing every day. MBD also publishes and export books to Europe and south East Asian countries. Some of the major clients are in USA,UK,Canada,mexico,spain,Russia,south Africa, gulf countries, Nepal and Bangladesh amongst others. Recently MBD has opened its first international branch in UK under the name of Oxbridge Pvt. Ltd. Besides, the latest feather in cap is e learning venture of MBD group Alchemie, the first knowledge portal in country. The emphasis is creating an e learning platform, catering to students, teachers, authors, parents, corporate, institutions and government, targeting every learner. This path breaking venture is targeted towards masses and will take learning methodology in India by storm. The group has successfully established itself and into hospitality industry through its maiden venture The RADISSON MBD Hotel Noida.The Radisson MBD hotel is
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fully owned and managed by MBD group and is first five star hotel in Noida.For this Radisson hotels and resorts, a group company of Carlson hotels worldwide. In its four years of existence, The Radisson MBD hotel, Noida has quietly but distinctly defined itself as a trendsetter. Fashion and style play a large role in overall hotels public platform. Whether it is new age or age old interpretation of cuisines as it is award winning restaurant Made in India(The Indian restaurant),RED(The oriental restaurant) or S-18(The 24 hour brasserie)or setting new standards in designer chocolates and cakes at its pastry shop The chocolate boxor its 24 hr spa and fitness clubEspace,The Radisson MBD hotels creates beautiful synergy of fashion through its distinctive and distinguished events and has been a recipient of the Best Franchise of the year Award and a lot of recognition on the novel food and beverage concepts developed by the MBD group. The group is also establishing its own Food court brand under the name of Gigabite,re defining the very concept of food court, as we know of today, Gigabite ,envisaged as a double height space, typically over 20000 sq feet. Designed to be cultural icon where one can interact with ones own environment to leave an everlasting impression of oneself behind. Where one can savour the 5-star hotel global cuisine complimented by a well stocked bar at the hugely penetrative price.

Gigabite is mapped in all the major cities of India including Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Jalandhar and Ludhiana amongst others. The MBD group has also ventured in to premium and luxury mixed used developments primarily The premium used development, encompassing 5-star- hotel, premium retail and entertainment, are being developed using brand name MBD NEOPOLIS. Currently the group has two projects under the MBD Neopolis brand-where the experience never ends, under construction at Jalandhar and Ludhiana, which are the richest cities in India.

The MBD Neopolis houses the Radisson hotel MBD, Ludhiana, own and managed by the MBD group and also brags of the best retail and entertainment mix in the city including brands such as PVR, FAME, KIMAYA, PROVOGUE, NIKE, TOMMY HILFIGER and many more. The hotel would also house NUOVO, the style district and that appeals to enlighten, elite, an indulgently luxurious, sinfully sophisticated world with a private, Made to pamperlounge.Created by international designers here the best labels and their patrons will find a heaven of sartorial extravagences.NUOVO will be hot spot for the affluent elite of north wanting to savour luxury retail including brands such as canali,van cleef arpel,fendi and many more. The next category of mixed use development of the group, THE MBD ZEPHERshowcases lifestyle, luxury and surprise. The first category in this category is aimed at reducing luxury at Bangalore,the silicon capital of india,entailing three sublime universes: Luxury hotel ,luxury retail and luxury entertainment in white feild,Bangalore.For MBD Zephyr ,luxury retail target brands include saks,channel,hemes,Gucci,jimmy choo,Louis vuitton,Christian

dior,dunhill,ferreganno and many more.MBD Zephyr with its best panel of consultants including The WATGS,famous for designing some of the best hotels of the world,best brand mix be it hospitality, retail or entertainment and the best design, is targeted at delivering luxury in every sense of the word. The group with its current portfolio to hospitality and mixed use development projects in Noida, Ludhiana and Jalandhar, Bangalore has similar plans in Mumbai, Delhi, Chennai, Hyderabad and Goa. The group is already is recognised as professional and trend setting company in India.

As part of its ongoing efforts to have 13 more properties in the country, Radisson Hotels announced a tie-up with the MBD Group which is opening a five-star hotel in Noida.
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While the MAD group, a leading publishing house making a headway in hotel industry, will be investing in and operating the hotel, Radisson Hotels will provide licence for brand name and management consultancy services. "The MBD Group will be investing around Rs 100 crore in the new property which will be in Noida. He said the new hotel will be known as 'Radisson MBD Hotel' and will have 120 rooms. "Management consultancy services along with licence for the brand name will be offered by Radisson," he said. Apart from this new property, the MBD group has also recently bagged an ITDC hotel in Kolkata. The group is further planning to bid for other ITDC properties, MBD director Sonica Malhotra said. Radisson Hotels is a brand run by US-based Carlson Hospitality Group which is also running other brands in the country including Regent International, Country Inns and Suites. Carlson Group is also planning to expand its existing network of Regent and Country Inns brands in the country in cities like Mumbai and Delhi.

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MALL REVIEW

TOTAL STORES OPERATIONAL STORES

61 42

DIFFERENT KIND OF STORES

ANCHOR STORES VANILLA STORES

04 57

FLOOR DIVISION OF MALL

LOWER BASEMENT UPPER BASEMENT LOWER GROUND GROUND FIRST FLOOR SECOND FLOOR THIRD FLOOR

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AREA SPECIFICATION
Total retail area Lifestyle Hypercity Cinemas Gigabite Mall build up Staircase Entry/Exit Radisson Room Total floors Hotels connecting stairs No. of restaurants Restaurant and bar Health club and spa Pool Night club Transformer Stabilizers DG sets Chiller plants Telephone exchange Internet lease line UPS of Mall UPS for Gigabite Inverter for Mall Inverter for Gigabite Refrigerators Elevators Escalators Tanks Restaurant Buffet ADD 3,10,300 sq fts 64000sq fts 68000sq fts 40000sq fts 30000sq fts 3.5 lakh sq fts 06 04 83,5 type rooms 13 02,03,05 03 th 5 floor 7th floor 5th floor 8th floor 04 GF 04 LB 05(1500 KV-Sudhir gensets) 05(400 ton-york) 800 lines-Alcatel Lucent Airtel 02(60 KVA) 02(20KVA) 01(20 KVA-Sukam) 06(2 for temperature &4 for +temperature) 22-continental 06-Kone 08-Kone 05 250 covers(12.30-3.30),(7.30-11.30) 60 covers-international cuisine not full meal but snacks, south Indian and Chinese(11a.m-11p.m) 40 covers- multicuisine only starters 60 covers Beverages Veg. snacks, mithai, cake ,pastries
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Bar Gigabite Express Bakery items Retail

STANDARD OPERATING PROCEDURE (SOP) at MBD NEOPOLIS

1. Standard time for opening the mall is 10 am for the guest. 2. The cleaning of retail area (mall) like for e.g. (Washing of floors) should start at 7.00am & should be checked regularly by the housekeeping staffs. 3. The mall executives who look after the DMO (Daily Mall Operations) should reach the retail area at 9am and check whether the operations has started as per the schedule or not. 4. A snag list should be prepared every day which marks the loopholes of the retail area including fixtures and fittings. 5. The music should start as soon as the operation of the mall starts by 10 am 6. Similarly snag list for washrooms should be prepared before 10am which should be checked after every hour to avoid inconvenience for guest. 7. Information desk should not be vacant, so that customer query should be handled properly. 8. Proper security checks should be conducted for concerned area. 9. Problems related to tenants should be checked & resolved on daily basis 10. The mall executives should inform the retailers about the upcoming events in the mall area. 11. Should ensure whether the escalators are working properly or not. 12. Its the duty of the help desk to issue specific Job Cards for complains registered. 13. A copy of snag list & DMO should be submitted to the concern department. 14. Lights should be switched on by 6 pm, mall executives need to check whether the lights are working properly or not. 15. The executives should ensure that the computers should be shut down when not in use. 16. The closing time of the mall is 11pm along with the retail stores. 17. Any major repairs and cleaning that cannot be done during mall operations should be done after the mall is closed. 18. The lights should be switched off as soon as the mall is closed down.

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DEPARTMENTS

HOUSEKEEPING

MARKETING

HUMAN RESOURCES

MALL OPERATIONS TEAM

SECURITY

ENGINEERING

FINANCE

PARKING

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MALL OPERATIONS AREAS

Mall Management Rent, Cam Electricity Bill Recovery Distribution Of bills Common Area To be clean and Neat Good relation With retailers

Details First Week of every month Last week of every month To get it done with the help of Housekeeping Maintaining good relation, sharing their concern and solving the same on priority, Coordinating with marketing for Events and promotions To ensure availability of a dedicated staff at information desk at all times to help and guide the customer.

Marketing Activity

Customer information desk

Help Desk

To help retailers & ensure there feed backs and complaints are taken care properly.

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KEY RESPONSIBILITIES

Mall Manager:-

Financial Perspective
y

Coordinate the contracting process for contracts like security, building / mechanical / electrical works, landscaping, pest control and any other contract deemed necessary for the management of the properties

Track and monitor performance of each of the vendors and ensure enforcement of service level agreements as per the contract

y y y

Drive value adding and cost saving initiatives Monitor market trends and provide inputs for MIS Study emerging developments in the business environment and their impact on his work area

Customer Perspective
y y

Establish, execute and monitor service level contracts with the customers Institutionalize a continuous feedback mechanism with the customers and customize operations and maintenance services accordingly

Identify changing needs of the customer and highlight the same to the senior management to evolve innovative solutions for the same
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Provide feedback to project design, planning and control and management on practical issues relating facilities management arising out of their respective areas of work

Provide inputs to commercial and marketing on customer information and expectation handling.

Internal Processes Perspective

y y y y y y y y y y y

Ensure smooth functioning of day-to-day activities as per defined processes for mall Monitoring of Operation and Maintenance of All Utilities / Infrastructure Building Maintenance Management of House Keeping, Pest Control &Landscape Maintenance Services Systems for Security and safety / fire prevention & protection services Fire drills / evacuation drills Building Safety audit Other areas Events and promotions Revenue generation through marketing and publicity Identify suitable vendors for providing various services and coordinate their evaluation and involvement .

y y

Participates in the recruitment, training and development of staff members Direct day to day interaction with the respective department heads for smooth functioning, and prior notification by Mail, Weekly Meetings.

y y

& sharing customer experiences, suggestions & complaints on a daily basis Consistently motivation of the staff to perform & give best results by regular formal & casual

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meetings in house & out of the house.

Mall Executive:y

Enhance the value of the property by providing a pleasant and friendly environment for customers and tenants in the mall.

y y

Contribute team on checking standard of permanent shops, temporary shops& events Manages all facts of the daily operations, marketing through effective planning and utilization of resources to maximize net operating income and tenant satisfaction.

Supervises staff to ensure that property operations are carried efficiently and effectively

Participates in the development of business plans and directs special projects to enhance tenant sales productivity and center profitability.

Develops relationships and serves as liaison to civic representatives, business partners, home office and tenants.

y y

Manages tenant relations by inspecting and observing daily operation of all tenant . Generates revenues through temporary leasing efforts and sponsorship in cooperation with corporate staff. Researches local tenants and negotiates/recommends

Thorough understanding of Information flow from all departments with immediate coordination of the same.

Open to customer feedback comments / Feedback/ Suggestions with a proper record of the same & rectification as per the feedback instantaneously.

Regular update to all concerned about Guest Comments, Suggestions & Complaints with immediate solution and necessary amendments required to make the process user- friendly.

Direct contact for any requirement from the retailers related to Maintenance & HK job

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SECURITY
AREAS All entry Exit Parking Atrium Fire Exits CCTV monitoring to have better control, Challenges Customer Satisfaction Sensitive cases like eve teasing , theft, false alarm, fire, Emergency evacuations Smooth operations of parking on Weekends Avoid customer group clashes and fights Efforts Fire fitting drill is conducted Proper man power planning on week days & Weekends Training the staff on regular basis Conducting Mock drill on emergency for better control

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HOUSE EE

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KEY RESPONSIBILITIES

Housekeeping Executive:y

To ensure agreed standards of cleanliness and hygiene are maintained in all public areas in accordance with correct procedures and administrations.

To ensure that all equipment furniture and furnishing are maintained, checked and kept in good working order with in order

Responsible for proper setup, and checking regular availability & supply of equipment & chemical stock.

y y y y

Maintenance & upkeep of Public Areas Assures that facility is tidy and sanitary and has all the supplies needed to run smoothly. Staff training, inter-department communications, and staff scheduling. Responsibilities include Employees establish and maintain production schedules, procure materials, equipment, and supplies, prepare budgets, and confer and resolve problems with facilities sections and vendors.

y y y y

Deep and high level cleaning of assigned areas. Ensure mall and park area should be pest free. Proper coordination with other departments. Work for high degree of cleanliness in all areas of the mall.

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Horticulturist:y y y y y y y y y y

Maintenance and development of horticulture work at various locations of MBD Manpower management. Time management for horticulture material like manure /fertilizer etc. Insect /pest card and disease management. Nursery establishment /management. Planning and controlling of park. Plant propagation. Daily reports concerning to horticulture. Maintaining existing greenery /plantation of Mall /Park. Planning of new plantation for dead greens

22

EE

23

MARKET

24

HUMAN RESOURCES

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RETAIL INDUSTRY
The Indian retail industry has a size of $300 billion. As a results of improvement in income dynamics, favourable demographics and spending patterns India has witnessed an unprecedented consumption boom. At present Organised Retail in India is at a blossoming stage but its growth is a scorching pace. The key drivers are:

y y

Consumer or Demand-Side drivers Retailers or supply side drivers.

While the total Indian retail sector has grown in line with private consumption, organised retail has grown at substantially higher rates. Inspite of the recent growth, organised retail accounts for a very small portion of the Indian retail market compared to other developing nations reflecting huge potential for growth. Growth in organised retail is driving demand for retail malls in the country.

Seeing the potential, major global retail chains like Wal-Mart, JC Penny, etc are eyeing the country. The Government is also promoting the sector and considering allowing FDI in the sector.

Key players
A summary of key players in the organised retail segment in India is as follows:

 PANTALOON RETAIL(INDIA) LIMITED  SHOPPERS STOP LIMITED  RPG ENTERPRISE  LANDMARK GROUP  MADURA GARMENTS  GLOUBUS
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Demand Drivers
Key factors that are driving growth of organized retailing in India are as follows:

Rising Urbanization: India has a huge and rising urban population, which is the target segment for organised retailing.

Higher disposable incomes: Population growth combined with a growing middle class with increasing disposable incomes is likely to give a boost to the retail industry.

Easy availability of credit: Availability of credit is easier with interest rates coming down over the years, coupled with increased willingness of banks to lend. Further, the issuance of credit cards has provided greater flexibility to spend.

Growing number of employed and educated women population: Growing number of employed women population has resulted in increased double income households leading to greater disposable income and increased demand for items like women and children apparel, key segment driving retail activity in India.

Infrastructure improvements and increased availability of retail space: Availability of retail space has historically been a growth constraint for organised retail. The recent increase organised in retail such as mall development has led to increased supply of quality retail space.

Media proliferation and rising awareness level: Access to information and global trends has increased consumerism and spending patterns.

Brand profusion: The urban population is becoming brand-conscious thereby driving demand for organised retail.

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According to a study done by HSBC, the boom in organized retail sector is already having an impact on mall construction with a combined space of 26.4 mn, under construction across India. India is likely to have over 220 shopping malls by 2007, as against less than 30 fully operational malls in 2003. 1 The shopping mall phenomenon, however, is not likely to be restricted only to metros, with malls also coming up in non-metro cities and larger towns across the country.

A study done by Knight Frank India indicates that by 2007, approximately 75 mn sq ft of mall space would be available in India. Within this, Mumbai, Pune, NCR, Bangalore and Hyderabad will have a 74% share. The balance 26% will be made up by cities like Kolkata, Chennai, Ahmadabad, Raipur, Nagpur, Lucknow, Indore, Ludhiana & Chandigarh.

Outlook
The experience of other developing economies suggests that the transformation of retail from an unorganized sector to an organized sector can be rapid. The org anized retail penetration in India at less than 3% is very low even as compared to developing countries like Taiwan, Malaysia and China having penetration levels of 75%, 55% and 17% respectively. This indicates a significant potential for growth in organized retailing in the coming years. Market estimates indicate annual growth in the region of 25%-30% p.a. in the short- to medium term which is expected to take organized retail to 8%-10% of total retail sales by FY10. 2Growth in organised retail will continue driving demand for retail malls in the country and investment option will further increase as the Government will finally open up international investment in the retail sector during 2009-13 period.

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According to Technopak Forecast as posted on the Indian retail forum 2008 for the year 2014
y

Size of modern retail in terms of direct investment should be greater than US 30 billion (2009-13)

Revenue would be US$ 100+ billion

Share of total retail will be 16%

Space occupied will be 500 million sq ft

Direct employment will be 2 millions

Annual rate of growth : 35%

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Shopping malls
The latest trend in the corporate universe is of the emergence of the shopping malls. Shopping malls are an emerging trend in the global arena. The first thing that comes in our mind about the shopping malls is that it is a big enclosed building housing a variety of shops or products. According to historical evidences shopping malls came into existence in the middle ages, though it was not called so. The concept of departmental stores came up in the 19th century with the Industrial Revolution. Consumers wanted a better shopping experience and this demand gave rise to the emergence of shopping malls in India. Originally the first of the shopping malls was opened in Paris. Then the trend followed in the other metros over the world, and there was a spree of shopping malls coming up at various places. In this age of mass production and mass consumption, the concepts of shopping malls is most modern method of attracting consumers. The concept of shopping was altered completely with the emergence of these shopping malls. Shopping was no longer limited to a mere buying activity - it has become Synonymous with splurging time and money. People simply go about roaming through the shopping mall in order to peep through the window of the shop and often ending up buying something they like. The consumers desire a combination of comfort and suitability which the shopping malls cater to, and so this format of shopping has become so popular all over the world, and especially so in India. The inclusion of amenities like restaurants, multiplexes, and car parks attract more and more crowds to shopping malls, which are considered family hangout zones.

Advantages of shopping malls:

y y y y

Increase in the growth of the organized retail sector Monumental increment in economic growth Employment generation by the organized retail sector Good competition means better products & services

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Disadvantages of shopping malls:

People began moving to the suburbs during the 20th century.
y

Shopping malls were built to set the companies with superior resources would muscle out the ones inferior to them.

Monopolization of the organized retail sector

In India, the emergence of shopping malls has mostly altered the lifestyle of the consumers. With the growth in income, changing attitudes, and also the demographic patterns favor the emergence of shopping malls.

The trends to follow in the future:

y

The shopping malls favor a growth in the Indian organized retail sector by 10% within 2011

There would be different living formats of shopping malls depending on the region.

Brief history
In the United States, peve consumers in areas outside of the cities. By 1916, a shopping mall called The Market Square opened for business in Chicago, IL. The facility was comprised of 28 stores, apartments, and offices. The Market Square was located in the expensive Lake Forest suburb and is thought to be one of the first planned shopping centres in the U.S. In 1950, the Northgate Shopping Centre was built in Seattle, Washington. This shopping mall boasted two rows of stores on each side of an open-air section where shoppers could walk. Two department stores anchored each end of the shopping centre. The first enclosed shopping mall was Southdale Centre in Edina, Minnesota which opened its doors in 1956.

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Up until the mid 1990s, most modern-day developers built enclosed shopping malls in order to create a climate-controlled shopping environment. Today, developers are returning to the creation of open-air shopping malls. Outlet malls, shopping centres featuring name brand retailers selling their products at discounted prices, are often built in an open-air format

Types of Shopping Malls

In general, you will find only regional centres, superregional centres, and Fashion/specialty centres on this Web site. Relatively few community centres were chosen, but appear here because the centre may have, at one time, been considered a regional centre. Only a few theme/festival centres were listed in heavily urbanized areas, such as San Francisco, because of their particular attractiveness or size. Finally, the new designation, lifestyle centre, displays because of their classic-mall type appearance even though they are without a classic-mall anchor store.

Fashion/Specialty Centres
Characterized as higher end, fashion oriented centres between 80,000 and 250,000 sq. ft.

Community Centres
Characterized as having between 100,000 and 350,000 sq. ft. Usually two types of anchors, such as a discount department store or large specialty/discount apparel store.

Lifestyle Centres
A new designation that has a loose definition. Generally, it's a centre that does not have an anchor tenant in the classic sense (that is, a department store). However, lifestyle centres increasingly have a cinema as a major tenant. Others have just a small collection of exclusive shops.

Outlet Centres
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Characterized as manufacturers' outlet centres with a surface area between 50,000 and 400,000 sq. ft.

Regional Centres
Characterized as having between 400,000 and 800,000 sq. ft. Usually two or more anchors, such as a conventional department store, junior department store, mass merchant, discount department store, or fashion apparel store.

Superregional Centres
Characterized as having over 800,000 sq. ft. Usually three or more anchors, such as a conventional department store, junior department store, mass merchant, or fashion apparel store.

Theme/Festival Centres
Characterized as tourist-oriented, retail and service centres between 80,000 and 250,000 sq. ft.

Components of shopping mall

Food court
A shopping mall food court consists of food vendors offering a selection of food. At a typical food court, food is ordered at one of the vendors and then consumed at a seating area, which is normally a plaza surrounded by the counters of the multiple food vendors.
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Department stores
A department store is a retail establishment which specializes in selling a wide range of products without a single predominant merchandise line. Department stores usually sell products including apparel, furniture, appliances, electronics, and additionally select other lines of products such as paint, hardware, toiletries, cosmetics, photographic equipment, jewellry, toys, and sporting goods. Certain department stores are further classified as discount department stores. Discount department stores commonly have central customer checkout areas, generally in the front area of the store. Department stores are usually part of a retail chain of many stores situated around a country or several countries. Its of the small producers, especially farmers, also have to be protected by preventing the emergence of local monopolies/monopolies. It has to be ensured that competition is not stifled and potentially monopolistic practices in credit, input and output markets are not encouraged by the entry of large corporate retailers. Moreover, undue pressure on urban infrastructure and the environment arising out of the proliferation of large format retailers has to be prevented.

The GREAT Indian Consumer

A change from pyramid to sparkling diamond

Indias ascendance as an economic power to reckon with, has forced the world to unravel the mystery called INDIA. An intriguing element of this mystery is Indias consumer market; characterized by diverse languages, regions, religions, economic and social status, this market has always been a tricky proposition to understand.
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Now, as the market undergoes a paradigm shift due to Indias rapid economic growth and favorable demographics, it has also become a market impossible to dismiss.

Global corporations view India as one of the key markets from where future growth will emerge. The growth in Indias consumer market will be primarily driven by a favorable population composition and rising disposable incomes. A recent study by the McKinsey Global Institute (MGI) suggests that if India continues to grow at the current pace, average household incomes will triple over the next two decades and it will become the worlds 5th-largest consumer economy by 2025, up from 12th now.

Indias consumer market till now was broadly defined as a pyramid; a very small affluent class with an appetite for luxury and high-end goods and services at the top, a middles-class at the centre and a huge economically disadvantaged class at the bottom. This pyramid structure of the Indian market is slowly collapsing and being replaced by a diamond a relatively large affluent class at the top, a huge middle class at the centre and a small economically disadvantaged class at the lower end. The diamond represents increasing volume and value across all classes of Indian consumer market.

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What Has Changed

Two major changes have taken place though it is tough to pick them in the right sequence of cause and effect. First, the consumer market has evolved at a steady pace since 1980s. With the advent of color television, and then cable and satellite channels, the mass reach of brands multiplied manifold. A choice generation was born, that had made more choice than its predecessors whether of soft drinks, watches or even career

The big change is that the generation has entered the work force in the past few years has grown up with choice, and cant get enough of it. It is now infinitely more cool to be earning and spending money than it was 25 years ago. And now that it is earnin g on its own, this choice generation is exercising its discretion to spend even more. A big bang- possibly similar to the baby boomers of America- has just happened in the work force, in the actively consuming population whose reverberations and aftershocks will continue for years.

Second, the rush of real estate investors in to develop shopping centres has poured more money into retail infrastructure in the last 6-8 years than ever before.

The confluence of these two factors is creating a tipping point of sorts at breakthrough velocity, developments building rapidly in a feedback loom. The choice generation is coming of age and the shopping centre boom allows companies to launch new chains that offer consumers more choice and create more A- grade real estate demand

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Pro-growth demographi

The wi espread adoption of i proved medi al care and birth control since the 1970s has reduced birth rates and increased the proportion of citi ens living past their retirement age in most countries. As these countries have an aging population, they are beginning to face an acute shortage of working age population, while the proportion of dependent population is increasing.

India along with a few other countries is an exception to this. In India, the proportion of citi ens of working age is forecast to fall slowly and the overall labor force will continue o grow. India has a t young population, 54% of Indians are under 25 years of age A rising productive population fuels . growth and drives personal consumption and a lower age dependency ratio places less strain on public finances. A young, economically empowe population not only translates into increasing consumer red demand but also into a more value-conscious demand.

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Thus, pro-growth demographics will expand consumer market in India. The National Council of Applied Economic Research (NCAER), forecasts that the number of consumers driving growth will grow from 60 million households in 2007 to 146 million households in 2012.

Decoding the empowered Indian consumer

The Indian consumer market is drawing global attention not just because of its promise of sheer volumes but also because of the tectonic shift happening in the nature of demand. Increasing urbanization, increasing incomes and rising aspiration for a better life, especially, among the lower economic strata are some of the factors reshaping the Indian consumer market. The result of this flux is a new Indian consumer who is more discerning than ever, ready to place his money on brand, quality and convenience and eager to explore the organized retail market.

Organized retail constitutes a small percentage of the Indian retail market but promises consumers better quality and better shelf-life for products due to their excellent storage facilities and anti-tampering checks. An important factor attracting consumers towards formal retailing mechanisms such as hypermarkets and departmental stores is the shopping experience. These shopping outlets all consumers to explore their choices and touch and feel products in the comfort of a glitzy and energetic environment, something a kirana or mom and pop stores have never been able to offer.

The Indian consumer market is thus on a cusp of metamorphosis. The upbeat mood of the economy, the youthful exuberance of the population and its increasing integration with globalized lifestyle and consumption patterns will drive growth in the Indian consumer market. However, to assume that the Indian consumer will become an exact replica of his global counter part is the biggest fallacy companies can make. While, the Indian consumers appetite for value and brand dominated goods and services is increasing, the cultural and regional framework characterizing him is intact.

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In fact, the income induced class movement happening across the rural and urban regions is forcing companies to re-look at their customer segmentation and product positioning. Cons umer companies are thus reali ing that the Indian consumer market is a tough nut to crack but the one they cant do without. Possibly the most challenging concept in marketing is to deal with the understanding of consumer behavior. The attitude of Indian consumer has undergone major transformations over the last few years. The Indian consumer today wants to lead a life full of luxury and comfort. They just don't want availability of products. Instead, they want better experience, services and ambience. They don't mind spending that extra buck.

E olution of Retail Mall in India

Rural

Weekly markets

Village fairs

Traditional

iranas

om and Pop

Hy e /S

e marke s

e artme ts stores

S opping malls

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Advent of the Mall Concept

A new idea whose time has come when arrives, cannot be bunged by anyone. Especially when it proposes an essentially finer monetary and behavioral value scheme to its clientele, it gradually takes over the old way, and other stakeholders have no option but to acknowledge and transform accordingly. Modern retailing is one such inevitable reality which has started taking a spin in the traditional retail scenario and is soon liable to capture the retail sector and further enhance its compass. All elements in the delivery chain better accept it and prepare, rather than trying to rob the customers of a superior way of life by promulgating fallacy and protecting vested interests.

From eyeballs to footfalls - the human psyche has taken a complete downward journey in the last few years. If it was eyeballs (number of visits to websites) during the dotcom boom of 2000, now it is footfalls (number of visitors to malls). The current mall mania that has gripped a shopping-frenzy nation can only be compared to the dotcom madness. But, just operating in a conventional manner by enticing the customers with broad assortments, low pricing and extended work hours, is not enough to count on success. The entertainment aspect of retailing, or entrailing, is increasingly being recognized as a key competitive tool. Many retailers are responding to the threat of Internet-based shopping by leveraging the brick-and-mortar advantages that virtual retailers cannot match such as higher levels of service, highly trained staff, and an entertaining and fun retail environment. In fact, in this evolving retail landscape the hedonic experiences that a customer can now obtain are virtually endless, from rock-climbing walls in shoe stores, to singles nights in grocery stores, to off-road test tracks in Land Rover dealerships.

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Consumers buying behaviour in malls

As a part of my project, I have tried to analyze and investigate some of the motivational reasons people go for shopping by conducting a small research. In any event, it is interesting that mall related studies have explored adult consumers and teenagers while ignoring the group that lies in between, i.e. the older segment of generation Y. These 20-27 year olds constitute a bridge between adolescents and adults when buying behaviour is in transition.

y y

About 54% of Indias population is below 25-27 years of age. These are the decision makers of a family. These days, from a computer to a car, from home furnishings to apparels, all such decisions are taken by them, i.e. whether parents or younger siblings, they all consult them before taking any decision.

A significant number of these older generation Y consumers are earning, by working part time of full time. Thus they represent a significant opportunity for retailers today. This research tries to investigate the relationship between the older Generation Y consumers and the motivational factors for visiting malls. It would help retailers to examine current and potential patrons, thereby providing guidance for store designs and marketing communication strategies.

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Objectives

The purpose of doing the project is to find out:

The evolution and future prospects of shopping malls.

Effect of these shopping malls on the buying habits of consumers.

Effect of Shopping Malls on small retailers.

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Introduction
This project basically deals with the emerging mall concept across India in general, and Ludhiana in particular, growth of the Indian consumer market, what led to the changes in consumer preferences towards them, how much the malls have been successful in delivering what they have promised, what factors help in making a mall successful and their future growth trajectory.

With the help of this project I want to throw light upon the entire modern retail scenario, malls particularly. It is purely based on my observation and understanding, which was mainly derived by visiting a number of malls and high streets in Ludhiana and reading material including research papers, journals, reports etc.

Ludhiana City Highlights

Fast Track growth spurred by Industries Dynamic multinational and corporate presence. Increase in government spending in infrastructure. Among the fastest growing cities of India. Supports an internationally connected garment industry. Industry base for the largest apparel park in Asia. Increase in population over the years. Sizeable numbers with ample disposable incomes. Young, trendy, fashion conscious, upwardly mobile. Diverse, cosmopolitan canvas. Growing NRI resettlement and plough back. Currently on the threshold of retail revolution. Transitions in consumer behaviour and buying patterns.
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y y y y y y y y y y y y y

Research Methodology
Analysis of primary data was made which was collected while interacting with the targeted samples to find out the purpose of visiting malls, how often the visited malls, what do they buy in malls and with whom they prefer to go shopping etc.

Research Design
The study is observational and descriptive in nature. Questionnaire was administered to about 50 visitors of different malls in Ludhiana .

Sampling Design and Sources

Sampling units included visitors of malls who were residents of Ludhiana. Questionnaire was used to collect primary data about mall visitors.

Secondary data- research papers, journals, magazines and publications available about retailing were thoroughly studied.

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SWOT Analysis of retail (shopping malls)

A SWOT analysis of the Indian organized retail industry is presented below:

Strength:
Retailing is a technology-intensive" industry. It is technology that will help the Organized retailers to score over the unorganized retailers. Successful organized retailers today work closely with their vendors to predict consumer demand, shorten lead times, reduce inventory holding and ultimately save cost. Example: Wal-Mart pioneered the concept of building competitive advantage through distribution & information systems in the retailing industry. They introduced two innovative logistics techniques:
y y

Cross-docking EDI (electronic data interchange).

On an average a super market stocks up to 5000 SKU's against a few hundred stocked with an average unorganized retailer.

Weakness:
y

Less Conversion level : Despite high footfalls, the conversion ratio has been very low in the retail outlets in a mall as compared to the standalone counter parts. It is seen that actual conversions of footfall into sales for a mall outlet is approximately 20-25%. On the other hand, a high street store of retail chain has an average conversion of about 50-60%.

As a result, a stand-alone store has a ROI (return on investment) of 25-30%; in contrast the retail majors are experiencing a ROI of 8-10%.
y

Customer Loyalty: Retail chains are yet to settle down with the proper merchandise mix for the mall outlets. Since the stand-alone outlets were established long time back, so they have stabilized in terms of footfalls & merchandise mix and thus have a higher customer loyalty base.

Opportunity:
y

The Indian middle class is already 30 Crore & is projected to grow to over 60 Crore by 2010 making India one of the largest consumer markets of the
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world. The IMAGES-KSA projections indicate that by 2015, India will have over 55 Crore people under the age of 20 - reflecting the enormous opportunities possible in the kids and teens retailing segment.
y

Organized retail is only 3% of the total retailing market in India. It is estimated to grow at the rate of 25-30% p.a. and reach INR 1,00,000 Crore by 2010.

Percolating down: In India it has been found out that the top 6 cities contribute for 66% of total organized retailing. While the metros have already been exploited, the focus has now been shifted towards the tier-II cities. The 'retail boom', 85% of which has so far been concentrated in the metros is beginning to percolate down to these smaller cities and towns. The contribution of these tier-II cities to total organized retailing sales is expected to grow to 20-25%.

Rural Retailing: India's huge rural population has caught the eye of the retailers looking for new areas of growth. ITC launched India's first rural mall "Chaupal Saga" offering a diverse range of products from FMCG to electronic goods to automobiles ,attempting to provide farmers a one-stop destination for all their needs." Hariyali Bazar" is started by DCM Sriram group which provides farm related inputs & services. The

Godrej group has launched the concept of 'agro-stores' named "Adhaar" which offers agricultural products such as fertilizers & animal feed along with the required knowledge for effective use of the same to the farmers. Pepsi on the other hand is experimenting with the farmers of Punjab for growing the right quality of tomato for its tomato purees & pastes.

Threats:
y

If the unorganized retailers are put together, they are parallel to a large supermarket with no or little overheads, high degree of flexibility in merchandise, display, prices and turnover.

Shopping Culture: Shopping culture has not developed in India as yet. Even now malls are just a place to hang around with family and friends and largely confined to window shopping

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SURVEY

OF

SHOPPING

HABITS

OF

CUSTOMERS VISITING MBD NEOPOLIS

I like visiting mall with:

28%
38% Family Friends

3%

Family Friends

31%

48

l ne

Shopping for me is Excitement

17

28

49

Strongly agree

10

45

gree

Undecided Disagree Strongly disagree

Shopping for me is Interesting

10%

7% 35%
3% Strongly agree Agree Undecided

Disagree Strongly disagree

45%

50

Customer is tempted to buy a product if sale is on

17%

Strongly agree

10%

45%

7%

21%

51

gree

Undecided Disagree Strongly disagree

Customer is eager to buy a product if it is similar to an on-going fashion trend

3%

16%

36%
Strongly agree Agree Undecided

Disagree
19%

Strongly disagree

26%

52

Customer is aware of the condition of small retailers due to shopping malls

10%

7%

28%

10%

Agree U d ecided

isagree gly disagree

45%

53

Str

Str

gly agree

Customers prefer shopping malls for their regular shopping rather than other local markets

14

27

Disagree Strongly i sagree

28

21

54

 

 

10


Strongly agree
Agree n e ci e

CONCLUSION
After looking at the above data we have come to a conclusion that presently there is a trend of considerable increase of shopping malls in all the metro cities, small towns and a large section of middle class , upper middle class people are coming for shopping because of the following reasons: 1. Customers convenience for shopping. Items from food to clothing, grocery to Electronics are available under one roof. 2. Better environment and improved customer service. 3. Competitive price with seasonal discount various gift scheme. 4. Various options to the customer for choosing brand and variety. 5. Ample scope of promoting sales and enhance brand image. 6. Availability of parking space for their car 7. Scope of employment at local area for various segment. Considering mash rooming of shopping mall, small business man, shop owners and farmers are facing acute financial problem as their business transactions are reducing sharply. Loosing employment by the employee of small shop owners, many of them who were dependent on the small shop for their living are facing the heat. On one hand where the shopping malls are slowly capturing the market due their superior power and size for which they are able to attract more and more customers towards them, on the other hand due to growing trend of shopping mall , especially the farmers and the small shop owners of groceries and other house hold goods are affected as considerable number of customers are shopping these items from shopping malls instead of normal market, and the profit margin is slopping towards the shopping mall. To encounter the situation it is required to impose rule or preferably ban by the concerned authority to restrain sales of some particular items (fruit, vegetables and some other glossary product) from shopping mall. This will give the small shop owner and the farmers some protection against the giant shopping malls, so that they can get back to their normal state.

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ANNEXURE 1: QUESTIONNAIRE

BASIC INFORMATION

Name Age Gender Profession Hometown Income Email id

I like visiting mall with:

Family Friend Alone Family and friends

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DEGREES OF SATISFACTION
1. Strongly agree 2. Agree 3. Neutral 4. Disagree 5. Strongly disagree

YOUR OPINI0N
Shopping for me excitement Shopping for me is interesting I am tempted to buy a product if a sale is going on I am eager to buy a product if it is similar to an ongoing fashion trend I am aware of the condition of the small retailers due to these Shopping malls? I prefer shopping malls for my regular shopping rather than other local markets

1.

2.

3.

4.

5.

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References

y y y y y y

www.indiatimes.com www.indianmba.com www.thetimes-tribune.com www.economictimes.indiatimes.com www.slideshare.com MBD Neopolis

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