The household name of every Indian, Godrej enjoys the patronage of over 400 million Indian every day. In an interview Adi Godrej, Chairman, Godrej Group shares his views about the future of retailing in India
DSB: Could you please elaborate on some of the marketing strategies that the company is using to reach out to the consumers in urban and rural areas?
AG: We have various marketing strategies. For advertisement, we use various mediums like newspapers, television, radio, internet, and outdoor advertisements. We have a lot of promotional activities at our stores. We put a lot of emphasis on our products, on consumer promotions (like price reductions, coupons, samples and free offers), and on trade promotions which helps our retailers.
DSB: Godrej Group has several retail formats under its umbrella. Please share what each format consists of.
AG: We have three retail formats. There is one rural retailing format called ‘Aadhar’ which is a part of Godrej Agrovet. We have now sold 70 per cent of its shareholding to Future Group and we own only 30 per cent. Another is ‘Home and Interiors’ retail format called ‘Godrej Lifespace’ which sells our consumer durables. Godrej Lifespace, the retail brand of Godrej & Boyce Mfg.Co.Ltd., operates 51 exclusive ‘Home and Interiors’ stores in 25 cities across India. It is one of the largest retailers of home and office improvement products in India. Our third format is Gourmet food retailing chain called ‘Nature’s Basket’ which is an independent company. It offers authentic food, beverages, choicest ingredients, and premium and niche food products to Indian consumers. The stores maintain the highest quality standards in their service levels, ambience and in the selection of products on offer. We had our first signature store at Warden Road, Mumbai in 2005 and later came up with gourmet stores in Mumbai. In addition, we have recently opened our first store in Delhi.
DSB: What is your reaction to the union budget 2010-11 with respect to business?
AG: The impact of Union Budget by and large on Indian economy and our business is positive. The change in the income-tax slabs, additional spending in rural India through NAREGA and other schemes and emphasis on education will be extremely positive. I think it is a growth oriented budget. However, there will be some inflationary impact from the budget because of the excise-duty hike as well the hike in petroleum excise-duties. Overall, I feel it is a good budget.
DSB: What is your reaction to the Indian Government not allowing foreign investments in Indian retail industry?
AG: I believe that foreign direct investment should be freed in retail as well as most of the other sectors in India. Government should not control FDI in India.
DSB: How is the road ahead for the Indian retailers?
AG: In my view, Indian retailers will do well. Modern retail will pick up and traditional retail will also stay. Both formats will do well. I expect that retailing is a strong growth oriented business.
DSB: Tell us something about the new website launched by Godrej Group.
AG: We have launched an interactive website ‘Go Jiyo’. Godrej is a co-sponsor of the IPL and the new web site has been launched with the commencement of the IPL matches. The Go Jiyo site is a brand-building initiative to address the youth, as there is a large segment of young consumers for our products.