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Welcome to marketers' hangout zones

The newest attempt at grabbing elusive eyeballs is branded outlets - which marketers hope will serve as 'hangout zones'.

Mar 19, 2008, 05.38 AM IST
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Once upon a time, the college katta or the nearby chai stall was the main hangout for college students across India. They haven���t disappeared completely and continue to provide asylum to collegians killing time before a lecture or taking a break from getting educated. What���s changed is the choice of places to hang out.

From local chai stalls to movie theatres, it���s moved to fast food chains, pizza outlets and cafes. But as the need to connect with the target segment, particularly the youth, becomes imperative, even brands are plunging headlong into providing a more evolved hangout experience. Marketers of brands in as diverse segments as tea, coffee and wines to banking, cold beverages and consumer electronics are busy chalking out ���lounges��� which make a cool, hep and happening statement.

Some of the brands that have been experimenting with this format include Nescafe, Tata Tea, Smirnoff, Microsoft Xbox, Chateau Indage, Coca-Cola , Citibank and Amul. While the outlets may differ in size and staff, branding efforts in each store make them unique. Xbox lounges for example are present in both stand-alone and shop-in-shop formats , spread over an area of 300 to 500 sq ft. Chateau Indage���s Ivy has different sizes for urban and rural markets.

While stores in urban areas are spread over 800 sq ft, Ivys in rural markets are over a 1,200 sq ft, which would definitely burn a hole in the pocket, if transposed to a metro setting. Vikrant Chougule, MD, Indage Hotels Group admits real estate to be a concern, ���In urban areas, real estate is a hindrance, but isn���t much of a problem in rural. Because of the costs we try and stay away from high street locations. We are okay with being in a quiet neighbourhood because people who like wine will find us irrespective of the location.���

Xbox, on the other hand, depends more on the shop-in-shop format, for which it has tied up with The Mobile Store. Explaining the rationale behind Xbox lounges, Ashim Mathur, national marketing manager, entertainment & devices division, Microsoft India says, ���Xbox requires people to touch and feel the product, a lounge helps them see and experience it. We have well-trained staff at the lounge who help answer queries and doubts consumers have about games, accessories and console.��� This format helps Xbox address real-estate concerns as well.

���The profile of customers who visit The Mobile Store and those who like to look at our products are quite similar, the interiors and ambience of the stores gel well with what we want,��� explains Mathur on the choice of The Mobile Store as a partner.

Coca-Cola���s Red Lounge outlets operate on a franchise model and therefore don���t require investments to be made in real estate. Discussing the format , Venkatesh Kini, VP-Marketing , Coca-Cola India says, ���The Red Lounge is located within a mall and is a place where the youth can watch TV, play video games, surf the net, chat and also experience the whole range of Coca-Cola products.���

For Nescafe, the concept of Cafe Nescafe evolved some years ago when, anticipating the changing customer lifestyle, they decided to pioneer out of home consumption for coffee in an organised manner. ���It exists in two formats ,��� explains G G Pillai, business manager, OOH Nestle, ���we first understand the needs of the consumer at the location and then decide whether it should be a full range Cafe Nescafe that provides a wide variety of speciality coffees , teas or soups, or a scaled down ���coffee corner��� , located within stores or restaurants, targeting takeaways.���


Amidst all the outlets that have changed the tea-drinking habit of the nation, comes Tata Tea���s ambitious project Chai Unchai to promote tea as an equally cool beverage. Sangeeta Talwar, ED-marketing , Tata Tea says, ���Chai Unchai fills a gap between the huge unorganised segment comprising tea shops or dhabas, and the premium priced tea houses. The focus is on providing a space for youth which provides a memorable and exciting ���adda��� experience.���

And there are signs that even categories like banking are looking to jazz up the entire experience, via business centres . Citibank for example has opened Citigold Business Centre at select branches for its high-value Citigold customers . The centre has a state-of-the-art meeting room, where customers can use facilities to remain connected with office or home even as banking transactions takes place.

Rahul Soota, head ��� retail banking, Citibank India, says, ���This service helps strengthen Citigold���s promise of exemplary service and connecting better with our clients, which in turn has a positive rub-off on the Citi brand due to positive word-of-mouth and experience sharing among customers.���

One advantage these outlets offer is undivided customer attention. ���The number of consumers who order wine is encouraging ,��� says Chougule, ���Although there are no concrete figures, about 70%-80 % tables order wine in the evenings and 30% of the tables order wine during lunch, even if it is port-wine .��� Ivy, says Chougule, also enables the company to promote wine culture in India: ���Once you are in, the d��cor gets you to try something and most of the times the customer ends up ordering wine.���

Ivy has presence across eight locations in both urban and rural areas and has plans to set up 34 outlets by March 2009 across the country. Amul parlours as they are called are present on campuses of Infosys, Wipro, IIM-A , IIT-B , Somnath temple, Dwarka temple, Metro rail and Gujarat rail. Spread over 150-200 sq ft, Amul is targeting a figure of 10,000 parlours by 2010. Elaborating on the parlours, BM Vyas, MD, Amul says, ���Our idea of opening the parlours is to be independent. We want to directly reach the customers and eliminate the middleman.���

Cafe Coffee Day is one of the foremost players in providing experience using outlets as a platform. Shyamala Deshpande , senior general manager, Cafe Coffee Day offers a word of advice for all the brands, ���Apart from the products and services, it is important to concentrate on the look and feel. Caf�� Coffee Day creates a very relaxing environment complete with comfortable chairs and sofas. Also from time to time, Caf�� Coffee Day brings to its customers offerings by way of interesting alliances with likeminded brands.��� CCD���s success comes from the first mover advantage that they have in a space which was relatively untapped until their entry.

None of the brands have invested in marketing or advertising their outlet but are relying largely on the brandpull for their success. Says Kini of Coca-Cola , ���We are looking at rolling out a range of above- and below-the-line initiatives locally within Pune and Bangalore to create a buzz and traffic to Red Lounges. Being located in malls we manage to attract high footfalls especially from the youth who are looking for a hangout destination with friends.���

Chai Unchai also favors locations like college campuses, IT parks, malls and hi-streets for its outlets. In case of Ivy���s rural format, Chougule says footfalls come from a mix of customers, ���There are wine farmers who come because it���s a new place they want to try and there are travellers because we are located quite close to the highways.���

For its urban format, Ivy depends largely on word-of-mouth and on some pamphlets that it has distributed. CCD has interesting offers and promotion running from time-to-time . One such offer currently is a talent hunt based around the concept of ���Hope��� ��� based on Tanuja Chandra���s latest feature film, ���Hope and a Little Sugar���.

While it maybe difficult for new entrants to have the kind of presence that CCD or Barista enjoy, everybody still wants to try. Investment in real-estate is probably one of the biggest dampener in this case but those taking the initiative have enough muscle-power to compete with the oldies. It will be very interesting to see how these outlets perform in the long-run and with brands like Costa Coffee , Starbucks and Taco Bell knocking at the door, nobody is ever going to complain about lack of space to hangout.
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