Lately, we have seen many “Retail Concept Stores” marking their presence in the Indian retail space. To name few, brands like Peter England, Celio, Reebok and Nike have experimented with this retail format in the last couple of months.
In fact, Nike has announced to put focus on concept-based stores for future in a bid to strengthen its position. So the question arises, why there is sudden rush for concept stores. Concept stores are emerging as new catchment area that retailers wish to explore up to the hilt.
But, before we proceed further we need to understand what concept stores are all about :
What is “Concept Store” ?
A concept store is a unique way of communicating the brand’s take on consumer lifestyle directly with the consumer. It’s astore that goes beyond simply selling products. Elaborating this format, COO, Peter England, says, “Many of the brand stores are opened keeping in mind the right market catchment and other business dynamics. While a Concept-Store is opened purely keeping in mind what the brand wants to communicate with the consumer and in what manner.”
Peter England has just come up with its ‘Generation Store’ at Jaipur. The concept store aims to help the young professionals with apparel that is designed to take care of his/her needs.
Reiterating the same Brand Director, Reebok India, says , “A concept store is one that goes beyond the basic selling of products, and instead focuses on appealing to a particular segment of the market or a category of consumers that follows a particular lifestyle.”
He highlighted that these stores aim at offering a complete experience to their consumers, and give them a sense of the lifestyle theme that they are centered around. Fit Hub is the concept store initiated by Reebok.
Flagship versus Concept-Store :
Apshankar highlighted that there is no preference among the two. Both these formats have their own purpose.
A concept-store aims to go beyond a simple ‘consumer-brand transaction’ to a ‘consumer-brand interaction.” On the other hand, for a flagship store, the prominence of location, volume and value growths, profitability and latest merchandise offering and mix are a priority.
Mall or High-Street :
As per market experts, usually high-street locations are considered to have an edge over the mall locations for a concept-store. This is because, a mall store usually restricts the level of customisation and changes that can be done in a store area to build a concept-store. In addition, investment per square foot is also higher in a mall store.
Addressing the same, Basu says, “Both locations have their own advantages and disadvantages, and the decision to choose either one depends on a variety of factors.”
At one hand, a mall offers various retail solutions under roof, which ultimately results in time and money saving. On the downside, some of the malls in the country lack efficient management systems, which imply an increase in retailer’s cost of maintenance, considerably high rental costs, and a poorly-thought-of tenant mix.
High-street locations offer greater space, and the option of customisation to a higher extent. Such locations are great for flagship stores. They also give consumers a more personalised experience, and hence attract the right kind of shoppers that enter a particular store with the intent to make a purchase of their products.
In a media interaction, Nike India Marketing Director said, “Nike India is exploring options of setting up concept-based stores in the country to garner more share in the domestic sportswear industry valued at Rs 3,500 crore.” Likewise, Reebok, which has 50 Fit Hub stores in India, has plans to have 100 Fit Hub stores by April 2014.