Strategy for a brand to enter the travel retail market in India

Abstract

Purpose – India as a country is fast developing with a major chunk of people entering the middle class and upper class. Premiumization is a huge trend in India especially with increasing disposable incomes. More Indians now travel regularly through all modes of transport and naturally such travel points become potential retail hotspots. While airport retailing has detailed accounts, not much work has been done on tapping the vast rail and bus terminal potential in India. This research aims to identify if there is significant potential for travel retail in these points and to explore the possible product offerings that would be bought by people if travel retail was indeed operating. The ultimate aim of the research is to develop a framework which would serve as a summarisation of the entire findings and which could be used by brands while make the decision of whether to enter the travel retail market in railway and bus terminals. Approach – Exploratory research was conducted to figure out important factors affecting shopping behaviour at travel terminals. Two surveys, one for finding out proportion of premium travellers (assuming uniform distribution) in both trains and buses and the second survey for grouping important factors affecting shopping behaviour in travel points (Factor analysis), finding attitudes and personality of travellers using a 5 point Likert Scale and conducting a 2 sample t-test to find out differences between segments and using a constant sum scale to find out category preferences for various segments of travellers. Results – It was found that 7 factors affect shopping decisions which can be grouped into 3 major factor via factor analysis. Also with the 2 sample t-test it was found that Economy and Premium passengers in both Buses and Trains showed significance difference in traits such as impulse in shopping, travelling preferences, shopping with family/shopping alone etc. A framework was developed with the help of the above findings and with help of the category preferences obtained from the constant sum scale responses.