“Our efforts would be on expanding the edifice created by Reliance Retail at the customer end and reinforcing supply chain and logistics,” said Chairman Mukesh Ambani.

Referring to “short breather” taken by retail business, Ambani assured the shareholders that Reliance Retail will return to “expanding coverage” by reaching out to “new cities, new markets and new strategic alliances.”

Reliance Retail, the retail initiative of the Reliance group, was launched three years ago. Reliance unveiled first cluster of convenience format retail stores under the brand name of ‘Reliance Fresh’ at Hyderabad in November, 2006. Today, Reliance Retail, is serving over five million loyal customers across 86 cities in 14 states, through 900 plus stores that are operating under several (convenience supermarket, mini-hypermarket, hypermarket, and specialty) formats and 15 brand names.

The retail company, which is a wholly owned subsidiary of RIL, is still in its growth phase and has incurred a loss of over Rs 450 crore during the financial year 2008-09. According to recently published results for the period ending 31st March, 2009, while Reliance Fresh had the maximum negative reserve of Rs 276.77 crore, Reliance Hypermart had the negative reserves of Rs 54.32 crore.

Reliance Retail has also entered into business partnerships with several well known global retailers and brands like Marks and Spencer, Office Depot, Pearle Europe, and Hamleys, among others.

The restructured programme, while offering individual loyalty programmes for different retail chains, will also integrate them across different retail chains being operated by Kishore Biyani-led Future group.

While, “Pantaloons” — the department store format, lifestyle, flagship, fashion, retail chain of the group is already offering “Green Card” loyalty to programme for several years to its customers, the group is looking at offering loyalty programme for its ‘value’ segment customers who account for bulk (over 60 per cent) of the retailer’s revenues. During the FY 2008-09, value products accounted for Rs 4,656 crore sales against the gross business of Rs 7,603 crore (61.23 per cent).

An integrated loyalty programme for the group’s biggest ‘value’ format Big Bazaar — a hypermarket format retail chain– is already in the works and may be unveiled soon for its customers. Big Bazaar, apart from contributing largest share of retail revenues also accounts for almost one-third of the total retail space of 12 million sq ft across 71 cities, occupied by the retailer.

In the past 8 years, since launch of the 1st Big Bazaar store in Kolkata (then Calcutta), the retailer has so far set up 120 Big Bazaar stores, which while offering a wide range of 160,000 products, serve two million customers every week.

Coimbatore-based Royal Classic Group, which makes Classic Polo brand of men’s apparel and operates 62 retail outlets across the country, despite healthy growth in sales this year, wants to take ’cautious’ approach for its expansion plans. Classic Polo also has a store in Singapore.

“We are cautious because of external conditions,” said R. Sivaram, Executive Director of the group.

The decision to adopt cautious approach, according to an HBL report, has been taken despite the brand having clocked a healthy growth of 60-65 percent during the first half of this fiscal. Even Diwali sales this year were better than the previous year.

Explaining the reasons for caution on expansion Sivaram said, ‘Our target audience is those in the 20-40 age group. A majority of youngsters of this age profile work for a BPO or KPO, and this is one sector that seems to be in deep trouble due to uncertainty and job loss. Our concern is there.”

The group has been registering high growth since it began retailing in India from 2001. The growth has mainly been attributed to the company’s loyalty programme which allows straight discounts of 5 to 15 per cent to different categories of customers. ”Our loyalty programmes are straight and a runaway success,” says Sivaram.

“Inflation has made no impact on our growth plan. We are going to open 70 more stores by the end of the current year and will invest Rs 700 crore for the purpose.” Ram Chandra Agarwal, Chairman, Vishal Retail.

Undettered by high inflation, Vishal- the Delhi-based mega markets retail chain has drawn up plans to set up 70 new stores by investing Rs 700 crore by the end of this year. This will increase the count of retail chain’s stores to 190, informed R C Agarwal, the group chairman, while talking to reporters on the sidelines of Pure&Play Retail Summit in New Delhi.

The company is looking at funding the expansion through a mix of equity and debt. It is looking at raising Rs 200 crore through private equity investment, for which it is already in talks with sevral PE investing firms. The balance requirement of fund will be met through debt.

“We are cutting cost on manpower and improving our efficiency by switching to larger warehouses and cost effective supply chains,” said Agarwal while talking about rising costs.

Vishal Retail will soon launch loyalty cards to attract customers, particularly females.

Vishal is also looking at introducing new brands in women’s wear category, this year.

With 108 stores operating in in 73 cities across 20 states, Vishal is one of fastest growing retailing groups in India. Occupieng over two million sq. ft., the retail chain offers a range of around 70,000 household products, at difficult to match prices.

“A single-player loyalty programme can never have a large base or offer as many rewards as one like i-mint which works by aggregating spends across various categories and the rewards under one umbrella.” — Vijay Bobba, CEO, Loyalty Solutions and Research Ltd.

Customer ‘loyalty’ or customer ‘rewards’ programmes are becoming popular among regular shoppers. They are critical to success of any retail business as they not only help retailers in understanding purchasing behaviour of their customers better, but also help them in retaining their customers at low cost, while encouraging their customers to make purchases more frequently.

While, almost all retailers, big and small, have designed one programme or the other, i-mint has come out with the concept of multiple partnership rewards programme. Multiple partnership programmes not only help offer the benefit to customers of purchases across multiple categories but more importantly also the benefit of earning rewards across programme partners. For example, a customer buying an air ticket from a travel agent through a bank credit card could end up being rewarded from all the three, namely, airline, travel agent, and the bank. i-mint, which was founded about 20 months ago, is one such card. It has recorded exponential growth since inception and is poised to grow very fast in the coming year, according to a Hindu Business Line report.

• i-mint, a unit of Loyalty Solutions and Research Ltd (LSRL), is the first large scale loyalty programme that unlike most other retailers co-brands its product with a number of corporate partners like Airtel, HPCL, ICICI Bank, Air India, Lifestyle and MakeMyTrip.com and over 2,500 merchant partners, from over 20 cities, that among others include establishments like restaurants, grocery stores, department stores, consumer durable chains, and jewellers.
• Unlike, rewards/ loyalty programmes offered by most individual retailers like Reliance (Reliance One), Future Group (ICICI-Big Bazaar), and Shoppers’ Stop (First Citizen), i-mint rewards programme offers its customers the flexibility of earning and accumulating reward points from multiple partner establishments.
• The rewards programme, funded by ICICI Ventures, has already logged in business worth Rs. 4,000 crore and attracted over four million persons as its members.
• Typically, i-mint members are young (25-35 year age group), mostly male (60%), and spend Rs 2,000 on an average across various categories. They are savvy with the usage of credit and debit cards. They are frequent users and have transacted at least three times in the previous six months.
• In an aggressive expansion programme, i-mint is looking at doubling its membership from 4 million to 8 million, quadrupling partner establishments from 2,500 to 10,000 and more than doubling its turnover in the next one year.
• While a single loyalty programme helps in retaining existing clients only, it can not help attract new customers.
• While, many single loyalty programmes reward only the higher-spending customers and alienate the others, multiple partnership programme treats customers more evenly.
• Additionally, multiple partnership programme provides better understanding of consumers’ behaviour across categories. Moreover, providing rewards across a network of establishments is of mutual benefit to both customers and businesses.
• In a marketing-driven world, when it’s essential to bring in more customers, repeat purchases and increase the bill size, and where the cost of acquiring customers is greater than retaining them, data mining becomes important, says Bobba.
• LSRL analyses the data from its database and helps its partners to exploit the same.