Every year during the Aadi festival, the Tamil month that falls between July 15 and August 15, people make a beeline to textile stores, jewellery shops and home appliances outlets with posters blaring the words ‘offer’, ‘sale’ and ‘discount’. This is just one defining feature of the end-of-summer month that also comes with a calendar full of religious festivals. But this seasonal change is making a tidal wave of differences in the way retailers do business and also in the way people shop due to the COVID-19. While we are just one week into Aadi, TNM spoke to a few popular retail brands in Chennai to understand the new strategies adopted by retailers and how it is translating into sales during the pandemic.
The year 2020 will stand out for ushering the Tamil month of Aadi into the digital age. Shop owners, on their part, have adopted quite a few changes, while the public has changed their shopping practices. And a big part of it is shifting online.
Manmohan Ram, Managing Partner, Sundari Silks in Chennai, shares that while their well-ventilated store in Chennai is open for customers to drop in, the Aadi sale will be made available online exclusively. “Walk-ins are good and our shops are always open but we have decided to do Aadi sales exclusively online. Discounts on clothing items are available on our website,” he said. The website is regularly updated and as expected, their sales volume online has increased.
In addition to the online sale, they have introduced two other services — video calling and personalised home visits. “Customers can fix an appointment for video calls with us and their purchase will be door delivered. Customers can shop on video calls also. For customers who want to shop from the comfort of their homes, we will send our sales executives with a wide selection of clothing to choose from. This is a new feature,” he explained.
At Pothys, a big chain of fast fashion apparels in Chennai, in addition to website and app sales, purchases can now be made via WhatsApp calls. “We have a toll free number. Once customers give us a missed call on the number, we get their details, location, etc. and the respective branch will contact them on a WhatsApp video call. The item of purchase will then be door-delivered,” said Dharshini, who runs Pothys Boutique.
Amarendran Vummid, Managing Partner of Vummidi Bangaru Jewellers (VBJ), shares his surprise on the increase in online sales, especially post lockdown. “It is extremely comforting for us. We thought people would shy away from purchasing gold at this point in time; especially since gold rates have gone up. Our online sales have gone up by 100% to 150%,” he said. As on July 27, the gold rate for one gram of 24 carat gold is Rs 5,430.
“With every portfolio management company recommending that gold is the best investment to make now, it has made a huge difference to the perception of gold in people’s mind,” Amarendran added.
Image courtesy: VBJ
“Before the pandemic, we used to get about two online purchases per day. Now, this has increased to about five to 10 every day. We have set up a small team only to attend to these video calls. Interestingly, the conversion to sales too is about 50%-60%. I was initially surprised to know that people were buying jewellery worth Rs 10 lakh and Rs 15 lakh via video calls,” he admitted.
The shop now has 65% walk-ins. Following Unlock 1.0 that was done in June, the shop saw about 40% walk-ins only. “Everyone is getting used to the new way of business, both merchants and clients. Although touch-and-feel is a deciding factor while purchasing such items, we are still able to go ahead and make the sale. The important aspect here is the willingness to buy. Between Unlock 1.0 and Unlock 2.0, sales have increased. If there are no more lockdowns, our walk-ins should reach 100%,” said Amarendran.
All retailers are in complete agreement that this Aadi will be unlike the previous years. “It is all about how it is this season. We surely cannot compare what we are doing this season with any other season. But it looks positive and it is good to know that customers are active and want to make purchases,” pointed out Manmohan Ram of Sundari Silks.
Retailers have also had to make investments with respect to technology. “We are now doing video calls using good quality phones. We also want to develop a separate app where customers can book their slots, decide what they want to see, following which a customer care executive will keep a slot aside for them,” explained VBJ’s Amarendran, adding that investments in technology and innovation are the need of the hour.
According to a marketing head from a home appliance store in Chennai, all businesses have cut down heavily on advertising expenditure this time. “One, people are afraid to visit shops unless it is absolutely necessary. Two, if we advertise and people turn up in large numbers, then that would lead to a completely different situation. Therefore, advertisements are of no help this time,” said the marketing head, who did not wish to be named.
Image courtesy: PTI
“Moreover,” he said, “the last 45 days have been without any business. Any further expenditure will only prove to be unproductive. There will be no satisfying returns on investment of this kind.”
Another challenge is in stock. “People are only coming to shops to buy small appliances. There are good orders for refrigerators and dishwashers. But the challenge now is that there are backorders and not enough in stock,” he said.
“Each state has its own problem. For instance, when we were under lockdown, Karnataka was open but now it's vice-versa. Manufacturing did not take place for a long time and in some places, production has just begun. This is the state of affairs for everyone,” asserted the marketing head.
However, retailers are making do with what they can this season, keeping their expectations low. “We did reconsider if we wanted to do the Aadi sale this time. We didn’t have great expectations but the returns have been decent,” said Amarendran.