BW Confidential - Issue #4 - October/December 2010 - (Page 76)

Market watch: India Retailing Changes in store Beauty retailing in India has undergone quite a few changes in the past two years, but more developments still need to come by Mayu Saini T raditional trade may still be dominant for beauty in India, and brands may still complain that retailers don’t understand the category, but in the past two years there have been clear developments in terms of new retail formats and displays. It is estimated that the traditional kirana stores still account for 81% of beauty sales in India, and an unfortunate fact of these small local stores is the unkempt shelves of make-up and skincare products watched over by unhelpful sales assistants. Now, however, even the smaller mom-and-pop stores selling cosmetics are redesigning to provide better brand visibility, and are even finding a place for beauty advisors. Bringing about change In the more organized retail channels, especially the department stores, there have also been improvements, with beauty counters now larger and featuring fewer barriers to access products. “Over the past 10 years Indian retailers by store numbers Store Big Bazaar Pantaloon The Body Shop Shoppers Stop New U Lifestyle International Central Hyper City No of pos 100+ 50+ 45 35 19 17 11 7 the stores have gained a greater understanding of several categories, especially fragrance, which is now clearly divided into the premium business and masstige/mass,” comments industry consultant and former distributor VN Thatte, who launched brands “ Over the past 10 years stores have gained a greater understanding of several categories, especially fragrance, which is now clearly divided into the premium business and masstige/mass Industry consultant VN Thatte Source: Industry sources such as Calvin Klein in India. He continues: “However, in the premium category there are just about 10 brands that contribute to 70% of the business. It is difficult for any other premium brands entering the market to garner shelf space and it will be a long wait for them to see their brands all over India.” Leading the revolution in quality beauty retail has been the K Raheja-owned ” department store chain Shoppers’ Stop, which inaugurated its 35th store in New Delhi this August. Shoppers’ Stop ceo Govind Shrikhande comments: “Beauty is an important area of focus for us. We have been seeing increasing revenue coming from this segment and are committed to investing in it.” Shoppers Stop plans to invest Rs5,000m ($106.7m) to open 40 new stores across the country in the next four years. Dubai-based Landmark group, which runs the Lifestyle International chain is also expanding. It has invested Rs4,500m ($100m) in India so far, has 17 stores and plans to invest a further Rs1,800m ($38m) in the next three years. The Future Group owned-Central and Pantaloon stores, meanwhile have provided beauty retail in different formats all over the country. The Future Group plans to add three million square feet of space annually and is aiming for annual revenue of $6bn to $7bn in the next five years. Pantaloon’s department-store business, which accounts for about 90% of group revenue, reported consolidated sales of $1.7bn in 2008-09. Malls in abundance While department stores are developing, so are malls. There are currently some 250 malls across the country, with the slowdown last year having brought expansion to a trickle. However, in 2010, business is once again brisk, and 25-30 new malls are expected to open over the next year. Another key change is in the size of the malls, which are now targeting 300,000- 76 October-December 2010 - N°4 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #4 - October/December 2010

- Brand & retail news recap
- Digital digest
- Companies on the move
Take note
- Market facts, figures & trends
Best of BW
- Highlights from our e-publication
- The latest in fragrance, skincare & make-up
- BPI president Rémy Gomez
Insight: fragrance
- Category overview
- Retailing
- Industry viewpoint
- New opportunities
- Launch roundup
- Airport Spas
- Spa case studies
- New store concepts
Travel retail
- Market overview
- Retail strategies
- Interview: World Duty Free & Aldeasa
Show preview
- TFWA World Exhibition
- Six up-and-coming beauty brands
Market watch: India
- Country overview
- Industry roundtable
- Retailing analysis
- Sector outlook
- Sustainability
Last word
- Mintel head beauty consultant Nica Lewis

BW Confidential - Issue #4 - October/December 2010