Companies have to offer multiple choices of payment to consumers at the doorstep, Best Deal TV COO HARI TRIVEDI tells Ritwik Sharma. Edited excerpts:
What are the payment options that work best for home shopping channels and are any innovations being carried out in this respect?
Right now, Paytm is working to develop a special application for home shopping channel that is IVR based. Customers, while calling, can opt for Paytm and be diverted to an IVR. Tomorrow M-Pesa will work. The third thing we are exploring is collecting a cheque at the consumer’s door with a declaration, because looking at the current currency crisis and even the future you have to offer multiple choices to consumers at the doorstep. Cash on delivery may or may not work, so what are the other alternatives? As far as Best Deal TV is concerned, we are looking at M-Pesa and cheque. Other home shopping channels are also working in this direction. The fourth could be courier companies allowing delivery personnel to carry swipe machines. Ekart, the logistics arm of Flipkart, has been experimenting with this option in Mumbai and Delhi, and some customers are agreeing to that after the currency crisis because of which it will evolve faster now.
Is home shopping TV equally relevant in a post-ecommerce industry and has it managed to stay as profitable as earlier?
There are a few parameters. As far as ecommerce is concerned, a very young crowd below 30 years of age is going for online. Home shopping is a segment that is basically for housewives and in Tier-III, Tier-IV cities where people are not that Internet-savvy. Secondly, people still want a human touch. There can be various FAQs, which online companies cannot answer. At the most they can display some content or image. Home shopping mainly attracts housewives; therefore the fashion industry does very well.
You also have to differentiate products and give good deals on TV. For example, if a sari costs me Rs 150 in Surat on a wholesale rate, I may place an order for one lakh saris. Now, when we go to a Tier-III or Tier-IV city, the same sari is retailing in Rs 350-400. So, these customers are going more and more towards the home shopping channel. Lastly, every product has a lifecycle, at the end of which it is available for resale. An ecommerce player or a home shopping channel can pick up a large quantity of such stocks and liquidate.
Is it essential for home shopping owners to take an omni-channel approach to cater to a wider customer base?
At the end of the day, whether you go online or opt for home shopping the customer is looking for a deal for its uniqueness. Last month, on Best Deal TV we launched readymade blouses. In a metro city, to stitch an ordinary blouse it costs minimum Rs 500-700. And if you want to do some embroidery, it would go up to Rs 1,000. I was selling a set of three designer blouses at Rs 1,399. And it worked like anything. So, you also have to launch various concepts. In Naaptol, for the first time in India we launched a seven-inch netbook, and asked the manufacturer in China to make these products for India. We launched it at a price point of Rs 4,999. For a housewife, the basic requirements from a computer are Google, Facebook and at the most Twitter, a basic email account and maybe Skype. In 2009-10, the mobile was not that user-friendly and I used to sell 50,000-60,000 netbooks in a month. So, you have to keep developing such niche products in the home shopping industry.
What are the quality related issues that you face?
Quality related issues mostly crop up in case of electronics, especially mobiles. Because for a person who buys mobiles, a home shopping channel would gives replacement warranty. Now, customers don’t want to wait for a handset to come to the service centre and then get it repaired and delivered, so there you get a major CRM (customer relationship management) issue. But for a category like fashion and apparel and kitchen appliances, you hardly get any complaints. Sometimes, it is less than one per cent. At the most there can be complaints about size. Fashion and apparel gets negligible complaints.
How do you ensure quality control and the best prices?
Before any shows, we bring samples which are then examined by our QCT (quality control team) internally. If you talk about fabrics, there is a colour test done by dipping the material in water. The QCT has a right to reject a product. Secondly, when the physical goods arrive and at the warehousing level, sample quality control is carried out. Larger players like HomeShop 18 station their textile engineers in places like Surat to monitor the manufacturing.
In terms of reverse logistics, how do you manage product returns?
Whichever courier carries a parcel to a customer in 99.9 per cent of the cases also offers reverse logistics. Whenever we have to do reverse logistics, we ask the customer to peg the good and send us an image, and then we assign a logistics person through our software. Today, reverse logistics is not at all an issue. The only issue is that it is a time-consuming process. As far as Best Deal TV is concerned, only two to 2.5 per cent of the goods are returned. Almost 70-80 per cent of our sales our apparel, so the returns are mostly because of size.