Nokia to let customers touch & feel at its stores

Modern retail is coming to Nokia distributors. The company, which has 1.9 lakh outlets across the country, is insisting new franchises design Nokia’s ‘priority shops’ on the touch-and-feel model instead of the traditional over-the-counter format.

Shankar Subramanian, head of retail, says, “We have to keep up with the evolution of the retail format. Sometime back, there would be a counter and a salesman behind it. Nowadays, we cannot have a physical divide between the customer and the product they want to buy.”

Nokia currently has 750 priority dealers, which are franchise shops selling only Nokia products. Unlike many other markets, the Finnish company does not directly own or operate its own showrooms in India due to tight rules on entry of foreign companies into retail. In addition to the priority dealers, Subramanian said the company has around 1,100 shop-in-shops and “a few thousands” multi-brand outlets, which are part of organised chains such as The Mobile Store, and employs nearly 4,000 shop-floor sales agents.

The new format, which was inaugurated in Gurgaon on Wednesday, has a greater focus on selling Nokia’s services, besides the phones and accessories, he said.  Of late, Nokia and Microsoft have been striving to catch up with Apple, which derives a large chunk of its mobile revenues from the sale of software — music, applications and content — through phones. For example, Apple offers, sometimes for free, nearly 100 million applications to its users every month — an average 11 per user. In addition, Apple is also the owner of the iTunes service, which overtook WalMart as the largest music retailer in the US nearly two years ago.

Taking a leaf out of Steve Job’s playbook, Nokia too launched Ovi, a store offering music, games and other applications, in May this year. However, it is yet to populate the service with ‘paid’ applications for Indian users.

Subramanian agreed that getting Indian consumers to use a mobile app or music store is challenging. “The new stores will be as much about selling these services as selling our phones,” he said. “There will be solution specialists, who will explain the services to customers... People don’t take to it [services and applications on the phone] just like that.
Unless you are a geek, you won’t get to know about all these applications and you won’t use it. Customers tend to get it only when they see it,” he added. Subramanian, however, refused to share the number of new priority stores the company was aiming to set up in the coming months. “Nokia does not give country-wise expansion plan details,” he reasoned.

Nokia has been going slow on its retail expansion over the last 12 months due to the economic uncertainty, but will start expanding again. Subramanian pointed out that the new format, especially the one with solutions corners, is investment heavy and therefore, the expansion will be gradual. “For smaller cities, a lighter version of the new format is likely to be adopted,” he said.