Consumer insights, off the shelf

A funny thing was happening at the Wills chain of apparel stores run by cigarettes to cookies and clothing conglomerate ITC Ltd. It noticed a run on the shelves for winterwear at some of its stores — in September, long before the winter sets in across most parts of the country.

This was unusual. For starters, August and September are ‘in-between’ months for most retailers in the apparel business. The festival season is yet to begin; sales strategies are being readied for the ensuing months and winter is a while away.

But in the past few years, says Mr Kurush Grant, Executive Director, ITC Ltd, it noticed a peculiar spike in sales of its winter apparel at its stores even in September, especially in stores in the South and in Mumbai and Gujarat — which don't even have a winter to speak of.

NRI shoppers

A little analysis revealed that the Great Indian Diaspora was at work. Droves of holidaying students and other sundry NRIs visiting family back home were buying winterwear, cheaper here by 25-30 per cent, to lug back to the US and other wintry destinations.

Welcome to the world of customer insight, where consumer behaviour is closely examined and sales data are mined for information on buying behaviour — often resulting in a radical change in strategy.

As Mr Atul Chand, Divisional CEO, Lifestyle Retailing, points out, it wasn’t enough that ITC had this moment of serendipity. It had to do something about it, especially with its supply chain which wasn’t then geared to supply a portfolio of winter clothing in September.

As he explains, “Our store staff is trained to report emerging trends, which our planners study on a continuous basis. We learnt of this demand for winterwear two years ago from our stores in the southern markets and in Gujarat, which reported an increase in student footfalls and also NRI groups, seeking winterwear much before the season set in.”

Supply chain tweaks

Wills reconfigured the product development cycle and the supply chain processes to place advance orders for winterwear to cater to this demand. Sales consequently have seen a 10 per cent increase last Aug-Sept over the previous year. It isn’t just in apparel that ITC saw these huge sales spikes. As Mr Chitranjan Dar, Divisional CEO, Foods, says, the division suddenly began to see a 10-15 per cent hike in sales in Aug-Sept of its ready-to-eat Kitchens of India brand.

“Stores would complain of low stocks as someone would come and buy up 30 packs,” he says. While the brand is available in the US and Canada the range is limited; so, a lot of students were stocking up on ready-to-eats when flying back.

“Over the last four years we noticed an August spike of 9-15 per cent; last year it was 15 per cent higher. This is growing every year as the ‘word of mouth’ about such purchases spreads within the student community,” says Mr Dar. Again, the foods division had to tweak its supply chain to make sure the brand was available in plenty during this period.

As Mr Chand points out, it’s when people start asking for things out of context one’s ears have to perk up and look for the clues. Consumer insights, after all, can fall out of anywhere.

COMMENT NOW