Following the freebies trail
Shopping is top priority in today's lifestyle what with widespread discounts and exchange offers at various outlets. Are consumers satisfied with what they get? Do they care to read the fine print? SYEDA FARIDA finds out.
Photos: P.V. Sivakumar; Collage: K. Bharathi Raja
WALKING INTO a destination store -- the supermarket round the block, the first thing that grabs the mindspace is the 20 per cent extra on a toothpaste or the stainless steel katori coming free with the regular breakfast health drink. Come to think of it, would a person buy more of a product for the freebie that would cost a fraction of the bill? The answer is an affirmative yes.
Get a free disposable razor on purchase of two deodorant soaps. Some arithmetic this! Regressive, one may say. But then there are takers for the offers galore.
A ticket to Europe, a gold coin or a dinner set -- who'd imagined shopping could get you a refrigerator free -- provided you do a minimum required billing.
Blame it on the competition. "Things were not this wild a year ago. The last one year has witnessed a sudden big jump, particularly in the consumer durables segment. There has been a surge of offers with many players coming into the market - thus the offers, a demand driven by the market. Also the city has seen an attitudinal change. Earlier it was the `kaam chala lenge' outlook. Today,there is the element of international exposure. Almost every second house in the twin cities has a relative abroad. These apart there are the instalments and hire purchase schemes. But, can a person be lured into buying a high-involvement product such as an electronic gadget worth Rs 13,000? "Once he has made up his mind, the freebie coming with the product is welcome," says Girish Malpani, CEO, MPM Mall.
The credit card syndrome and the `experience' that super markets offer, for a price, one ends up spending triple or more of the required amount since smaller volumes are not stocked here.
Gone are the days of the next-door kirana store where one could pick up the required product within the budget. The problems of plenty do not stop here. Arrive the buy-one-take-one offers. And you end up getting the inventory pile home - a refrigerator, a washing machine with an iron box in tow. Yet another offer is the exchange - with retailers going the bania way. "The products are hideously under priced. A washing machine in a good working condition would fetch you a Rs. 51 to Rs. 1,000 discount at the exchange offer. And with regard to the discounts, there has never been a 40 or 60 per cent at the `up to' percentage slashes.
The white goods market is often active with offers, which encourages consumption in `off season' for instance, such as the offers of refrigerators and air conditioners where the consumer gets to save a few grand. "These are company offers. They do make the customer buy on the spot. It is beneficial to the customer rather than the price slash at least for the low end consumer," says Vamshi Krishna, manager, Digital Shoppy.
With regards to the Fast Moving Consumer Goods (FMCG) line-up like soaps, washing powders and more, it is the discount on price and other offers from different manufacturers that attracts the consumer. "The pack of three soaps with a fourth free is sure a welcome incentive for the housewives. This also goes for the clothes," says Sushmita Rao, a housewife.
Brand loyalty? This consumer trait is passé. "Earlier, we used to buy a particular brand of soap but now one is more open," says Tony who regularly checks out if there's anything new. Perhaps, taking a cue from the ever-so-dynamic market, the offers are rolled out and how. When breaking into a market with a new product, attracting new customers and maintaining competitiveness is important and that is when the offers come in handy. And, there are the monthly sales figures, the moving annual totals and the retail meets of the manufacturers in the FMCG sector.
Thus, the promotional mix, the family cycle, and more are frozen into the manufacture-driven immediate consumer benefits such as economy packs, free gifts and the branded price offers such as toothbrush coming free with the toothpaste. These are again matched with the additional offers, run by the supermarket chains towards retaining the existing customers and bringing in new ones.
"The volume discounts we get from manufacturers are passed on to the consumer. Products which feature in the monthly basket of the consumer are priced attractively," observes N. Balachandran, GM, Food World, Hyderabad. And the end user is apparently glad with the thought of saving money itself. "Why not, if the same product is available at less than the market price. But when it comes to cooking oil, it is a no. I am very particular about the food and premium products and there is no compromise on that," says Avinash Kumar. The market thus finds two types of consumers. One, the connoisseur who would go that extra mile to pick up the premium goods and the other, who do not look at an offer, but when it comes their way, they take it. "It depends on the perceived value of the freebie you give as a gift, to the target customer. For instance, giving a bag free on the purchase of two Arrow shirts would definitely entice the jet setting executives and senior managers who are the customers for Arrow," explains Sanjeev Rajput, senior officer marketing, Shoppers' Stop.
Much as there is the other side to a coin, there has been scepticism revolving around discounts and offers. "Nobody sells anything for a loss. It is disposing or rather putting products down the consumer's throat forcibly," says Rahul.
How often does one then look into the expiry date of the product on sale? Further, the loss of weight and nutritive content is known with the old stock in food products. "Ninety per cent of the time the consumer is losing out on the offers, be it investing more money on the offer goods. Moreover, the supermarkets do not keep smaller quantities. The clearance stock poses health hazards especially when you look into baby foods. Further, the offers are against the principle of the Monopoly and Restrictive Trade Practises (Prevention) Act. And, there has been no consumer education," says M. Krishna Reddy, Chairman, Confederation of Andhra Pradesh Consumer Organisations (CAPCO), an apex body to the 960 consumer forums involved in creating awareness among the consumers apart from dealing with consumer grievances. "We always suggest that the requirement is very important before you buy a product," he adds.
There will always be a competitive market, the sales figures looming overhead combined with a brand-open-offer-savvy segment and there will be offers. The bottom line is discretion - albeit the city has a reputation of being one freeloaders paradise with the hypermarkets and malls happening.
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