Case Study: Store Big, Mall Bigger

Angad Singh noticed the growing confusion on the face of Mallika Talwar, his colleague. Was there something he was now going to hear?

Angad had called for a meeting with Mallika and another consultant, Sanam Sinha to discuss Gigil’s proposed outlet in The Quartz Mall in Pune. Mallika looked uneasy as Angad explained the brief for their meeting that week with Gigil owners in Mumbai.

StratNext, a brand marketing and consulting firm, where the three around that table worked as consultants, would be advising Gigil on its branding at The Quartz Mall, in line with its ongoing strategy for the chain in India.

No doubt Gigil, a growing name in salons, had begun to find a following rapidly across the metro cities; but the spot that Gigil was going to occupy at The Quartz had erstwhile hosted a competitor — Volyoom, a high end, premium hair and skin salon. In less than 15 months, Volyoom was exiting The Quartz and Mallika knew of this. So, as Angad unravelled that Gigil was considering renting that spot, Mallika’s discomfort was visible, especially since Gigil’s new outlet in the mall was going to be exactly where Volyoom was. This made it all doubly worse.

Volyoom was bigger, better…. How could Gigil survive?

Angad: What’s it Mallika? You don’t look happy.

Mallika: I wonder if it is not part of the brand’s image and strategy to choose its outlets carefully.

Angad: I assume they have done all that... what is on your mind?

Mallika: Ok, this is not formal information, but based on what staffers at Volyoom told my sister. They have vacated Quartz as they were not returning enough revenue and Quartz wanted them to leave.

Angad: Weird. What does that mean?

Mallika: I am told they had to shut shop, vacate.

Angad: But how can we believe hearsay?

Sanam: Hearsay or fact, that Volyoom has quit so early is cause for concern for the business. The situation is critical for us to be better warned about what we need to know, do, think, feel — for Gigil, in this new location. It is part of our work. It will help us develop better strategies.

Angad began to wonder if as brand consultants they had defined their relationship poorly. What if there was truth to Mallika’s words? Should StratNext have had a role in advising on location? But then these malls… there was no precedent to these relationships or management of these relationships. He would have to keep flowing with the tide and discover his role as it unravelled every day! Then again, malls were these new aggregators and there was no school or text that provided an operating manual. Stores responded to what they thought was opportunity and then endured the outcomes. Every day was thus a journey from Oh-My-God to Thank God.

Angad then asked Mallika to go out and investigate some more and get whatever she could about reasons for Volyoom’s exit from The Quartz. There again, who knew salons would be big business enough to request strategy?

Mallika and Sanam spent two days talking to stores, shoppers and so on, to gather what they could. When she put together her research, she felt worse than she had when Angad had first told them about Gigil’s plan.

Mallika: To begin with, Volyoom was in The Quartz for over a year. It was a good salon because my sister patronised them and I often went by to pick her up, so I have a feel for its ambience, its location and its personality too. Additionally I also asked my sister Roona. The story is that Volyoom is a very renowned, premium brand and has a number of outlets in the metro cities. Has been doing well.

At the Quartz, Volyoom did reasonably well, so the stores on that floor say. The salon itself has shut shop, so there was no one I could ask. But Volyoom was not doing as brisk a business as they did elsewhere. One other nugget I heard was that Volyoom had to return a certain percentage of their billings as revenue to the mall every year and that they were not even covering that minimum. Yet another told me that Volyoom had decided to quit anyway as they did not experience the same brand expression at the Quartz as they did in their other locations.

Sanam: This is important: people don’t know if Quartz asked them to vacate or if Volyoom found the return to be delivered unreasonable and decided to opt out. These are important questions for Gigil to investigate and know.

Angad: I am sure Gigil knows, especially if they are taking the same location as Volyoom.

Mallika: Which is what surprises me. Why did they not discuss with us, their brand advisors? My difficulty, even grouse, is with the location of the salon in the mall. That itself is a biggie. Yesterday as I did the rounds of The Quartz, the location really made me think. That point you circled on the plan yesterday, is the basement level, what is usually called Lower Ground (LG).

It is the whole packaging, Angad. Where do I begin! The Quartz is a premium mall and Volyoom is premium too. But things did not pan out as Volyoom may have anticipated. For in the last six-odd months, the LG at Quartz has become mass in its layout and personality. That is my worry for Gigil. What hit Volyoom will afflict Gigil too.

Angad: Explain?

Sanam: First of all, Volyoom, a premium brand, is in the basement, flagged by mass brands. I feel the LG is not much of a crowd puller; on the flipside, the upper levels have more premium stores, bigger brands, stylish brands, so your crowds are gravitating upwards.

Angad: Not making sense. The mall is a premium mall, but its basement has mass brands? How do you justify the strategy here? And real estate is real estate finally…

I looked it up online and I see it has some multiplexes on the higher levels, and some fine dining too.

Mallika: That is the confusion at The Quartz. What you see when you enter the mall is the zero level, which is all premium. But, what they call the LG basement has non-branded home entrepreneur stuff. Not kiosks, but tables spread with wares… definitely not what Volyoom would have expected to find itself surrounded with. In fact, it has increasingly become like a mela, somewhat like Mumbai’s fashion street. They hold art exhibitions, children’s events and they even have a chap giving rides on alligators-on-wheels. My point is, while Volyoom was taken by surprise by all this, should Gigil willingly occupy a spot that could blunt its edge?

Sanam: For that matter, will any salon over there work? Or maybe the mass brands might…

Angad: So, what you are saying is that the LG might be populated with both stores and shoppers of the kind that is not what Volyoom expected?

Mallika: I think there is a confusion as to personalities. The Quartz has been advertising itself as being as luxurious as the Palisades Center in New York. Even if we say, ‘Their mall planner stretched that thought too much’, The Quartz does see itself as very special. So, did Volyoom lease the property for that dream and later find Quartz was unable to deliver the promised ambience? Even if we stop grieving for Volyoom, we have Gigil to think of. Should Gigil withdraw?

Angad began to buy into this argument. Could it be that The Quartz changed it business model after six months of finding that it was not able to sell enough outlets? Did The Quartz rethink the floor mix? Did it temporarily abandon its premium identity to rake in quick revenues? Did that mean other stores too were not doing well enough and hence was The Quartz’s revenues falling? Did Quartz fail Volyoom? Would this affect Gigil or will Gigil go in forearmed, now that StratNext has become wiser?

Mallika: The other thing that I felt was that when you enter The Quartz there is no way you can tell that there is a quality salon in that mall. No POPs, no signages…. No nothing. The only way you will find Volyoom is because someone told you it is there. Therefore Volyoom had no visibility.

Angad: I am trying to imagine what a person sees when he goes to the mall. What do you see immediately on entering?

Sanam: The mall itself is designed to look royal, distant and exclusive. So, you enter these vast gates with quiet garden patches and water bodies. This is enhanced by a flight of steps you climb to reach the doors. Once the doors let you in, you see a verandah-like wall, flanked on either side by a handful of severely premium shops, that overlooks the LG floor. When you look into this well, what you see at this stage are not the salon or the one or two other shops that could be eyeball catchers. What you see are racks of clothes, non-descript food stalls and children running with ice creams. You will see a coffee kiosk, a lot of stalls selling shoes, bags and arty stuff. The bad arty stuff.

Angad: Ok, so let us say you entered the mall and as you describe, you look down from that verandah. What is the thought that comes to you?

Mallika: So you will say, mmm…neechey kuch nahin hai, upar jaate hain. That is what happens. All you see from the gallery are the kiosks and street ware. People don’t know of the salon’s existence. It is not readily visible from level zero as you look down.

Sanam: There needs to be a crowd puller in the LG level to attract me to go down. In a mall, anywhere that the eyes see, that point must be a point of purchase, must be a point of advertising. At Quartz, what you see from that verandah when you look down, should advertise the LG level. I must say, hey let us go down. But that does not happen.

Angad: Good thinking, Sanam. Ok, poor thinking by Quartz. But what about the salon Volyoom? Did they not see what we are seeing? Surely you cannot depend on just the mall ambience to win business for you!

Mallika: I keep telling you, nevermind Volyoom, think Gigil. Can Gigil break even in the same time that Volyoom was there? I suspect, Volyoom did not.

Angad: And I will wonder why. It will be interesting to know what agreement they had with Quartz when they took the lease. Or, at least, what Quartz told them at the time they discussed its exit.

Sanam: Why not ask Gigil that? If they have rented the place they must have an agreement by now?

Mallika: I say, let us look at the marketing issues here, as if we are the prospective lessors. There are two parts, one is the kind of mall that Quartz is; two, where in the mall? If I go to a salon, I would not like to go to a basement and come out of it.

Angad: I don’t think so. How does it matter? The service does not change! Then again, basement does not mean car park; it is just another level, the LG floor, it is all jazzy and is a part of the mall, glass and granite as usual, but yes, not visually appealing because of its constituents… street wear, bling bags, footwear and accessories.

Mallika: Exactly. So, if my neighbourhood is scruffy, can I expect to get visitors? All right, I will go with you, people who know me well will come to my store out of loyalty. But how am I to expect new visitors? Don’t you see that in the whole surrounding, a premium salon will be out of place?

Sanam: I agree. Volyoom did stick out.

Angad: So, can we say that for the same reason, mall hoppers too did not lounge in the LGF as it did not look like it would have something of their league?

Sanam: I must explain, because I have used Volyoom at Quartz twice. Initially, I did not think Volyoom was out of place. At that stage, the LG level had just three stores open. The remaining stores all had ‘Coming Shortly’ boards for some premium brands. Those brands have till date not launched for whatever reasons. We don’t know. Or, can we assume their reasons are the same? But two outlets have opened recently with mass brands. I am saying in terms of footfall, the basement level did not see the presence of quality, premium stores. Right from the start.

Mallika: You hit the nail on the head. People refer to it as basement conversationally. Exactly as your mind too saw it as basement even after my saying to you that it was LG. Straight away, people’s expectations from a basement falls. A consumer is a bundle of perceptions. What we do is cater to those perceptions. Now this is the thing. When I have to tell a friend, ‘Get your haircut at Volyoom’, I would say go to the basement. I found it was natural to use the term ‘basement’. It is a put off.

As a result, people don't expect anything sensible to be there. Maybe if you created a meme such as “The LGF @ Quartz” and marketed its positioning differently, there would have been a different view of Volyoom.

Angad: You did not complete the ambience of Quartz. Please continue. What do you see as you enter the mall? It is important.

Mallika: First, the huge marble steps as if leading to a stage. When you climb up the four steps you enter another large concourse that has a slew of cosmetic shops such as Sephora and so on, neatly tucked into the distance, across from the verandah that looks into the stairwell at the basement. There, I said basement. I meant LGF. But if you looked across the well onto the other side of it, your attention is drawn to the neon lights of these cosmetic shops, and then a lingerie mart that is huge.

Angad: So, let me understand and you can add your thoughts too. Typically for anyone going to a salon in a mall, it is a planned thought, it is not a sudden, impulsive thought, yes? Like I won’t enter a mall to go for a movie and then also go for a pedicure?

Mallika: It is not unimaginable that you are at a mall, you see a salon, you decide to check if they are free for a simple pedicure or haircut. I think different services decide the impulse factor. Like you won’t impulsively decide to go for a facial or body massage as these need a minimum of two hours. I don’t know. I do think it is very subjective.

Angad: Now, let me reverse a little bit: I am suggesting that you would go to a salon in a mall if you already know it is there.

Sanam: Not necessary. If I am following a particular brand of salons, say, Flo or Amaani. And if I know it is present in the mall, and I happen to be shopping at that mall, I can decide on impulse that I will go get a foot massage. It is not entirely impossible. Similarly, if I am at a mall doing various things and I happen to spot a salon, and say, it is not my preferred salon, but it is in the category of good salons that I am likely to use (I use Palmolive but if I am faced with a Vivel, I will use it as it meets with my consideration set), then, I am still likely to check if they will give me a pedicure. So, the impulse decision depends on my need for that service at that moment.

Angad: What is your point?

Mallika: That going to a mall is often a destressor. It is a stress reliever, a recreation, a ‘I have nothing to do, so why don’t I just go mall-ing?’ It gives me visual excitement, takes my mind off things that usually bind and gag me, helps me do all those things that I usually have no time for, such as buying gifts, checking out a certain exfoliator at Forrest Essentials, check out if Café Black has resumed selling Dark Sin… It’s a place like the mind, a centre of tangible dreams. So, a pedicure, a hair wash, even a body massage if they have a vacant slot is not out of the ordinary!

Sanam: So, even if you know a service or product is there in a mall, the consumption point will come when you say that ‘I have a need for this service’. That is, you have no dos and don’ts. Have service will consume.

Mallika: My other grouse is: breach of promise by Quartz. A lot went contrary to plan. The same fate awaits our Gigil! If you think about it, Volyoom is a premium brand, chose its location well, at Quartz, and then was suddenly cheated of that by a growing environment that was steadily turning mass. Kiosks, stalls, bad coffee stalls. Soon footfalls to the LG level fell. Meanwhile Volyoom already has a premium pricing. See the mismatch? I don’t see visitors to that level being enamoured by that pricing.

Sanam: I disagree. A salon is not the sort of place that you go in because it attracts you. You develop a liking after you know the brand and then you are loyal. So, to say that people who visited LG were mass customers and hence they found Volyoom expensive, does not wash.

Mallika: If you see it from the standpoint of Volyoom, you can see how the failure to deliver a promise impacted their brand. They are known as a premium salon brand, they took space in Quartz as they saw a good fit between their brand and the mall brand. Then, the Mall clutters the LG and hence the environment for Volyoom.

I think Quartz must carry blame. One, their launch date was delayed so much. Meanwhile Volyoom had committed and invested there. Then, the mall opens and the other shops don’t start at the same time. Volyoom must have done its billings forecast based on anticipated footfalls. Those numbers did not happen as the LG remained dotted with “Opening Soon” boards for a long time. And when those shops did not open, kiosks and silly stalls gathered there. Is that good for a premium salon? Therefore, Gigil too will not work well there.

I feel a mall needs to have an inner vibrancy to help stores attract activity. But here, Volyoom was in a place where they are not easily visible, and worse, flanked by brands that did not complement them. I fear, Gigil too may be making a mistake.

Sanam: I don’t think Gigil will fail. Gigil has a greater chance, because those who went to Volyoom will now use Gigil, as the convenience factor is very high. There will be continuity of service.

Angad: That cracks my brand loyalty theory. And brings me back to my client Gigil who needs to understand why Volyoom did not fare well.

Also read analysis: Prachi Tiwari | Damodar Mall | Sadashiv Nayak | Salil Nair

To be continued...