The mobile retailing space is hotting up in India. Essar Telecom Retail, an Essar group company has entered mobile retailing in India with the launch of its "The MobileStore" outlets across the country. The basic aim is to be a complete telecom solutions provider.
It has tied up with global media firm Virgin to provide the backend solutions like customer care. This marks Virgin's entry into India's burgeoning mobile sector. Virgin founder Richard Branson believes that this is an opportunity for the two parties to fundamentally change the face of mobile retailing in India.
Indiantelevision.com caught up with Essar Telecom Retail CEO Rajiv Agarwal for a quick chat on the plans.
Excerpts:
Could you give me an overview of Essar's mobile retailing initiative? As the number of mobile subscribers, users becomes more and more the market is becoming more complicated, which has created a void. Our aim is to come up with total telecom solutions for the customer. |
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What are the different products and services being offered? |
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What is the synergy that the group has in setting up telecom retail? |
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As per research, what does the mobile user expect from a mobile retail chain and how is Essar going about fulfilling his/her needs? |
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Why did you decide against going the franchise route for your stores? The franchise route would have meant that there would have been no difference between us and any other mobile store. |
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Given that Indians are an extremely price sensitive won't it be difficult for mobile retail to make a margin and have sustained revenue? |
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What is the investment being made and how many stores are being set up? Over 70 stores have already been launched in places like Mumbai, Delhi, Kolkata, Hyderabad. In the next six to eight weeks we will have opened up another 100 stores. In the next six months we would be operating 700 stores. The stores are in three formats - large (1,000-1,500 sq ft), medium (800-1,000 sq ft) and compact (200-500 sq ft). The ratio being identified is 20:60:20 across large, medium and compact stores respectively. We are looking at a breakeven of three years for the business. The stores will cost between Rs 500,000 - Rs 5 million each to set up. |
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What are the factors looked at to select each location? |
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In terms of revenue how much comes in from where and who are the companies you have tie-ups with? We have a tie-up with Mauj Telecom for mobile games. For DTH there is Tata Sky, Dish TV. There are also opportunities for in-store advertising and merchandising. |
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Could you talk about the back end solutions that have been put in place? We chose Virgin as that brand stands for good quality, brilliant customer service, innovation, fun and good value. |
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Finally what marketing activities are being done to create awareness? |