World of small things

First Scene – Me with empty trolley

Location- Food Bazaar, HUB Mall, Goregaon

Scene opens with wife having monthly grocery list and a pen, She said “Let’s start with kitchen items first “& the warrior was ready to put items in the trolley and move as per directions given by her.

Sugar 2 kg, Besan 500 g, Pulses 500 g, 10 Shampoo sachets, 50 g Face wash, 2 kg Surf Excel…..

I tried my best to put my point across “Why are you buying such a small qty of each and everything, but not large packs and we can survive for longer time”?

After repeated efforts, I got an answer “15 din ke baad phir aa jaayenge” and this happened months after months and I decided to understand this psyche and started observing a normal shopper behavior across modern as well as traditional retail.

Thought Came: When shopping, why we intend to buy smaller packs, less qty of items?

Possible reasons I could found:

Less Money Shell out at one go ( Less Risk)

As Indians, we are taught to save money (save, save, save) leading to point that money in hand is more important if required in contingency. Its life savior, due to this, we tend to hold money with us more than we can spend. So now

10 Sachet of shampoo of Rs 2 each, Money spent= Rs 20 vs Rs 35 bottle of more qty at one go.

So Risk is less, a Psychological savings.

Trial

Buying smaller packs gives a consumer opportunity to try that product, if it suits you, then you can buy bigger packet later. Largely it is there in personal care products.

A small 100 g Masala will convey its message whether it is good or bad, so no buying the same next time.

Unitization

This is very interesting Point, during my visit to Vapi with my Head of Marketing, Mr Alok Kapoor, he taught me one interesting concept.

Commodity--------Product……….Brand

Companies charge premium when a commodity moves to product and then to a brand.

He gave one example, Sugar is essentially a commodity, when one buys the same in its loose form from a grocery store, and he will get it at say Rs 40/kg.

When a company packs the sugar in good plastic bags and changes the form to sugar cubes, it can now be unitized, 1 packet- 2 cubes, 2 packets-40 cubes, company charges the premium from a customer as a price of changing the form (cubes) now same 1 kg sugar is now Rs 45 / kg,( Liquid drops to be more costly as Rs 60/kg)

When it moves from product to a brand (Company has created its imagery of quality, trust, endorsed through brand ambassadors), perceived benefit is very high , customer is ready to pay more premium of branded sugar Rs 80/ kg.

A customer will always pay premium to a brand if his perceived price that he needs to pay is lesser than product’s price (That is separate point, will write about it later)

So unitization (smaller packs) has made customer believe that they are paying for a unit than whole pack.

When asked about price, vegetable sellers always say price of lesser qty,

8 rupaiye pao ( 250 g) than Rs 32 per kg, if he says Rs 32 per kg, customer will say, Mehnga hai and will walk away, but with Rs 8 per 250 g, vegetable seller has made sure that customer can buy less also.

(Smart tactics but with logic to it)

No Brand loyalties

Gone are the days when people use to stick to one brand, with hundreds of options available in each and every category, people tend to switch brand loyalties, if they buy larger packs, they will have to stick to that product for a longer time binding him not to use other products.

Last scene- I was seen standing in long queue to pay the bill and I was getting ready to lift 4 heavy bags of grocery…..

Vikas Sachdeva