Big Bazaar is an Indian retail chain operated by Pantaloon Retail that aims to provide affordable products to India's middle class. It was launched in 2001 by Kishore Biyani and pioneered organized retail in India. Big Bazaar uses strategies like low pricing, private label brands, and bulk discounts to attract customers. It has established over 100 stores across India and aims to continue its expansion through new store formats. Big Bazaar analyzes customer insights to tailor its products, promotions, and store layouts to Indian shopping preferences.
Big Bazaar's Marketing Strategies for the Indian Middle Class
1. PROJECT
On
BIG BAZAAR THE INDIAN WALL MART
Submitted By:-
VIJAYABABU.B
REG NO: 77
2. INTRODUCTION
Indian retail sector is witnessing one of the most hectic marketing activities of all
times. The companies are fighting for mind share and heart share which can finally be
converted to market share. There is always a âfirst mover advantageâ in an upcoming
sector. In India, that advantage goes to âBig Bazaar.â It has brought about many
changes in the buying habits of people. It has created formats which provide all items
under one roof at low rates, or so it claims. In this project, we will study its marketing
strategies.
Big Bazaarâs main competitors are other business houses which are planning to enter
the market as well as long established âKiranaâ stores which feel threatened by huge
retail chains.
BIG BAZAAR
FOR THE GREAT INDIAN MIDDLE CLASS
Kishore Biyani led the companyâs foray into organized retail with the opening up of
the Big Bazaar in the year 2001.
It is a unit of Pantaloon Retail (India) Ltd and caters to the Great Indian Middle Class.
It was started as a hypermarket format in Mumbai with approx. 50,000 sqft of space.
Its values and missions are to be the best in Value Retailing by providing the cheapest
prices and hence goes the tag-line
âIs se sasta aur achcha kahin nahinâ
It sells variety of merchandise at affordable rates, the prices of which it claims are
lowest in the city. Usually the items are clubbed together for offers as on the lines of
Wal-mart and Carrefour and it also offers weekend discounts. It currently operates out
of more than 100 stores and top 25 stores register a cumulative footfall of 30 lakh a
month on an average.
7P Analysis of Big Bazaar:
7P Marketing Mix is more useful for services-industries and knowledge intensive
industries. Successful marketing depends on number of key issues.
The seven keys issues are explained as
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3. Product: Big Bazaar offer a wide range of products which ranges from Apparels,
food, farm products, furniture, child care, toys etc. (Exhibit-7)Products of all the
major brands are available at Big-Bazaar(Exhibit-8). Also, there are many in house
brands promoted by Big Bazaar. Big Bazaar sold over three lakh pairs of jeans,
50,000 DVD players and 25,000 microwave ovens. In all, the fashion, electronics
and travel segments made up about 70% of sales. Last year, these categories made up
only about 60%.
Price: The tag line is âIs se sasta aur accha aur kahin nahiâ. They work on the model
of economics of scale. There pricing Objective is to get âMaximum Market Shareâ.
The various techniques used at Big Bazaar are:
Value Pricing: EDLP (Every Day Low Pricing): Big Bazaar promises consumers the
lowest available price without coupon clipping, waiting for discount promotions, or
comparison shopping.
Promotional Pricing: Big Bazaar offers financing at low interest rate. The concept of
Psychological discounting (Rs 99, 49 etc.) is used as promotional tool. Big Bazaar
also caters on Special Event Pricing (Close to Diwali, Gudi Padva, and Durga Pooja).
Differentiated Pricing: Time pricing i.e. difference in rate based on peak and non-
peak hours or days of shopping is also a pricing technique used in Indian Retail
which is aggressively used by Big Bazaar.
Bundling: Selling combo-packs and offering discount to customers. The combo
packs add value to customer.
The salient features of big bazaar are:
ï Well trained staff, the staff employed by Big-Bazaar are well-suitable for
modern retail.
ï Well dressed staff improves the overall appearance of store.
ï Employees are motivated to think out-of-box. Retail sector is in growth stage,
so staff is empowered to take innovative steps.
ï Employ close to 10,000 people and recruit nearly 500 people every month.
ï Use of technology like scenario planning for decision making.
ï Multiple counters for payment, staff at store to keep baggage and security
guards at every gate makes a customer friendly atmosphere.
Process:
ï The goods dispatch and purchasing area has certain salient features which
include:-
ï Multiple counters with trolley to carry the items purchased
ï Proper display/posters of the place like (DAL, SOAP etc.)
ï Home delivery counters also started at many places
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4. Range of Products Available at Big Bazaar:
Big Bazaarâs New Marketing Strategy:
Big Bazaar has launched new marketing strategy which is based on Guerrilla
Marketing. Guerrilla marketing warfare strategies are a type of marketing warfare
strategy designed to wear-down the enemy by a long series of minor attacks, using
principles of surprise and hit-and-run tactics. Attack, retreat, hide, then do it again,
and again, until the competitor moves on to other markets. Herein guerrilla force is
divided into small groups that selectively attack the target at its weak points. In the
world of cut throat competition, corporate use extension of the same strategy in
marketing. Corporate like Coke, Pepsi, etc have been using the same for quite some
time now and the latest entrant is our very own âFuture Groupâ- Big Bazaar,
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5. Pantaloons, Future Bazaar, eZone are all part of this group and they are taking on the
biggies like Shoppers Stop, Lifestyle, and Tataâs Westside.
In order to do the same, Future Group have come up with 3 catchy/cocky and cheeky
ad campaigns which surely do catch our eyes and surely one canât resist
appreciating the same.
Keep West-aSide. Make a smart choice!
Shoppers! Stop. Make a smart choice!
Change Your Lifestyle. Make a smart choice!
Big Bazaar: Positioning and Establishment
Big Bazaar has established itself in the first quadrant of Organization Value and
Customer Value Matrix. The SWOT analysis of current strategy of Big Bazaar
elaborates the core competencies and areas of improvement. The key features that
have shaped in establishing of Brand includes
Big Bazaar ensures that no other Kirana store/ departmental store are offering
considerable discount compared to its own price. This helped Big Bazaar in being
the âValue for moneyâ store.
Big Bazaar scores high on product mix as compared to Kirana store. Cheap and local
products are heavily stocked in Big Bazaar which make it easier to attract lower
middle class category of customers.
Promotion of Kirana event is rare event but Big Bazaar used this channel efficiently
to establish itself as national brand. Customer loyalty resulting in high up sell i.e.
selling to existing customers. Big Bazaar refrains from high-end locations for
business which reduces its rental budget and provides competitive advantage over
competitors. Kishore Biyani has taken âearly movers advantageâ in many retail
spaces.
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7. Sales promotion:
Big Bazaar has presence in almost all the major Indian cities. They are aggressive on
their expansion plans. Promotion Big-Bazaar started many new and innovative
Cross-sell and up-sell strategies in Indian retail market. The various promotion
technique used at Big Bazaar include âSaal ke sabse saste teen dinâ, Future card( the
card offers 3% discount), Shakti Card, Brand Endorsement by M.S. Dhoni, Exchange
Offer- âJunk swap Offerâ, Point-of-Purchase Promotions. Advertising has played a
crucial role in building of the brand. Big Bazaar advertisements are seen on Print
media, TV, Radio (FM) and Road side billboard.
Brand extension:
Brand Extensions actually made and future possibilities. Future Group is planning
to split Big Bazaar into two entities. One will be front-end consumer oriented entity
and other will be for back end operations. Back end entity may enter into joint
venture with leading international cash and carry retailer. Foreign partners like
Carrefour, Metro, and Costco etc are in the race and their role will be to improve
efficiency in sourcing and logistics, which will help drive down prices and boost
margins. The front end operations will be further divided in three categories, Big
Bazaar Express with store area less than 40000 sq ft, Standard Big Bazaar with store
area between 40,000 to 75,000 sq ft and Big Bazaar.
Supercentres with store area more than 75000 sq ft (Exhibit 10). Future group is also
planning to distribute financial products like consumer loans and insurance
through Big Bazaar outlets.
Consumer insights & perceptions:
Big Bazaar is based on 3-C theory of Kishore Biyani. The three C symbolize Change,
Confidence and Consumption and according to this theory âchange and confidence
is leading to rise in consumptionâ. They divided Indian customers in three
categories:-
India One:
Consuming class, constitute only 14% of Indian Population.They are upper middle
class and most of customers have substantial disposable income are the Initial focus
of Big Bazaar
India Two:
Serving Class which includes people like drivers, household helps , office peons ,
washer man etc. For every India One, there are at least India two and have around
55% of Indian population.
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8. India Three:
Struggling class, remaining population of India Cannot afford to inspire for better
living, have hand-to-mouth existence. Needs cannot be addressed by current
business models.The potential customers of Big Bazaar are India One and India
Two. The customer insights were developed by close observation of the target set.
The insights that came out were:-
The clean and shiny environment of modern retail stores creates the perception that
such store are too expensive and exclusive, and are not meant for India two.
India two find moves and find a lot of comfort in crowds, they are not
individualistic. They prefer to be in queues.
Indian-ness is not about swadeshi , itâs about believing in Indian ways of doing
things.
Indian customers prefer to purchase grains, grams etc after touching them, so itâs
better not to sell in polythene packs. Big Bazaar has counters where you can touch
wheat, rice, sugar etc. before purchasing.
Advertisements about schemes and offers through local newspapers, radio in local
languages inspires customer more than the traditional ways.
The guards, salesman at the Big Bazaar outlets should not look smarter than
customer, so they prefer not to have tie etc in their uniform.
Hypermarkets in India should be situated in city unlike western countries where
they are located away from city.
Purchased Bags/goods should be sealed at checkout as customer can enter and exit
multiple times. For Indians, shopping is an entertainment; they come in groups,
with families so Big Bazaar should offer something to every section of family. That
also led separate section for clothes, vegetables, food etc i.e . Multiple clusters
within a bazaar.
Advertising: The essential of brand building process
Advertising is an essential component of brand building. The advertisement and
brand building is done through various ways, the techniques used are:-
Tag line:
Big Bazaar tag lines are the key components of advertising. These tag lines are
modified according to demographic profile of customers. These catchphrases
appeared hoardings and newspapers in every city where Big Bazaar was launched.
Everybody understood and connected easily with these simple one-liners. The catch
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9. liners includes âHindi- Chane ke bhaw kaajuâ, âBengali-Rui er dame illishâ,
âHindi-Stall ke bhaw balconyâ etc.
Print Ads:
Big Bazaar news paper advertisements are present just before launch of any new
scheme. This creates aura about the Big Bazaar brand in the minds of customer.
TV Ads:
Kishore Biyani spends a lot amount of money in brand building exercise. Big
Bazaar commercials are shown on various channels in India. Presently, Fashion
@Big Bazaar commercial is aired.
Road side advertisements:
Big Bazaar billboards are displayed on prime location in various cities as a brand
building exercise. They display the catchphrases and now days.
Radio Ads:
This technique is used at cities like Sangli (tier 1 / tier 2 cities).Now a days it is
replaced by advertisements on FM channels. This informs customers about the all
new happenings at Big Bazaar.
Fashion shows: âFASHION @ BIG BAZAAR - Desh Badla, Bhesh Badloâ is the
latest invention of the Indian iconic brand. In an effort to take the Fashion to the
masses, Big Bazaar, the flagship hypermarket brand of retail chain of Future
Group,organized a three-day Fashion Show on the streets of Bandra, Mumbai.Brand
Endorsement by celebrity: Big Bazaar is always associated with celebrities for
advertising and marketing of its Brand-name. The current campaign is starred by
Brand Ambassador and Indian cricket ODI Captain Mahendra Singh Dhoni. Earlier
Himesh Reshammiya and Sanath Jaisuriya were associated with BigBazaar.
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10. Future Strategies of Big Bazaar:
Factors that shaped Big Bazaar during its life cycle:
The Big Bazaar brand name is in its growth stage (Exhibit 11). Pantaloon group
faced various small and large scales troubles in the introductory Stage of the brand.
Present years are the high growth in retail sphere as market has high potential to
sustain growth. The sales are increasing, more and more firms are coming to
markets, foreign players are entering into retail sector and pie of organized retail is
increasing in retail sector.
The factors that shaped the brand during its life cycle are:-
Influence of Sarvana Stores located in Theyagraya Nagar, Chennai:
Many people think that Big Bazaar was inspired by Wall Mart but the truth is that
Kishore Biyani and his team members are neither inspired by US ways of doing
retailing nor they have been to US much. The credit for foundation and inspiration
goes to Saravana Store, a family ârun 25 years old store, whose philosophy was â
low margin, high turnover. In that store, food, groceries, clothes everything had a
separate section. It had around 120 people just to manage crowd. The single shop
was doing business of more than 200 crore per year. This shop was the template for
Big Bazaar.
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11. Observing customer regularly:
Regular customer feedback is also an influential factor for the success of Big Bazaar.
The Big Bazaar has a separate team that looks for customerâs purchasing pattern and
how they like or dislike products, how they approach to particular products. For
example, unlike other stores where the most expensive and catchy item is placed at
the front display, Big Bazaar places the âValue for Money itemâ at check out point.
Imbibed entrepreneurial spirit in organization:
Decision making power is given to every level of employee at Big Bazaar. KB has
given risk-taking power, which led to entrepreneurial spirits into every employee.
Everybody in big Bazaar operates with speed and confidence when it comes to
decision making.
Building on core values:
Core values of Indian-ness, valuing and nurturing relationships and Simplicity
shaped the brand. Kishore Biyani always believes in long term relationships, with
customers, suppliers and employees. Once thinking about offering gifts to
employees close to Diwali, KB suggested giving them wallpaints to keep their
house clean. The paint is used in Indian culture to keep house clean and brings
freshness. The motive behind was to keep everything clean and bring freshness in
organization.
Strategic decisions taken to build the Big Bazaar brand:
The strategic decisions that lead to building of Big Bazaar were:-
Real Estate Game:
For a retailer, location is one of the most important things. According to KB, real
estate cost should be less than 5 % of total sales of store in order to provide
maximum benefits to customer. The strategic decisions to secure spaces before other
retailers join in have resulted in cost-saving. Also, it has created early presence in
market.
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12. Nurturing relationships:
KB follows strategy to develop trust and nurture relationships with suppliers. This
trust led to strategically correct decisions most of the time. Whoever works with
Future Group, either leaves in initial deals or continues forever. Use of technology,
scenario planning and story-telling Big Bazaar planning and design used advance
technologies like scenario planning and storytelling. These techniques were mainly
used for store-design layout, store-location selection. The strategy to use user-
focused, prototype-based development tool made the brand adapt to the fast-
changing external environment.
Design management:
Design-led thinking helped Big Bazaar to achieve âcustomer-firstâ objective and
ultimately lead to better financial performance. Big Bazaar strategy to focus on
design led to creation of Idiom, an independent design and consultancy firm, based
in Bangalore. They are one of the few organizations in India having economist,
ethnographers and sociologists working across various teams as a part of Design
management team. Back-end operations, supply chain Harvard Business School just
did a case study on Pantaloons' supply chain and it says that Pantaloons' is the most
cost-effective supply chain in the world. India may not have a modern supply chain
but it definitely has a cost-effective one. Retailers have made use of the existing
supply chain.
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13. Life Cycle of Big Bazaar:
Brand Ambassador:
A brand ambassador is a celebrity (or an attractive or interesting person) used to help
advertise a product or services.
Big Bazaar, has roped in cricketer Mahendra Singh Dhoni as the Brand Ambassador
for its new range of fashion apparel. Dhoni would feature in a series of advertisements
across all media. Dhoni and Big Bazaar have a lot of synergies as the Indian one-day
international teamâs captain stands for the aspirations of youths, while Big Bazaar is
looked up to by millions of Indians to fulfill their aspirations.
In this way, Big Bazaar make full use of the marketing mix for a new venture
which earlier belongs to the unorganized retail sector i.e. kirana stores. Application of the
best marketing practices helps Big Bazaar in a great way.
Future Expectations:
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14. Big Bazaar is planning to have 300 hypermarkets in the country by 2010-11. The
company may also increase its annual turnover to Rs. 13,000 crore by 2010-11, up from
Rs. 3,600 crore last fiscal on the back of its expansion.
The company has also gone on record saying that it would have another 35 stores by
the end of its fiscal in June 2009 to take the total number to 135. To achieve this they
are targeting a turnover of Rs. 5,000 crore in the current fiscal year and have
formulated plans for reaching a figure of Rs. 13,000 crore by 2010-11 fiscal.
For the expansion, the company would be looking at both the metros and Tier I cities,
besides TierII cities & smaller cities.
The marketing strategy seems to be perfectly on track as the Big Bazaar hypermarkets
had a footfall of 11 crore last fiscal and the company is aiming for an increase in the
numbers up to 14 crore this year. The average size of a Big Bazaar hypermarket is 30,000
sqfttoonelakhsqft.
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