Page 170 - DMGT522_SERVICES MANAGEMENT

Unit 7: Delivering Services on the Web

Notes
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Case Study Case: SangamDirect – Adopting Technology in

e-tailing - II

ith the retail sector showing such favorable signs of growth, Hindustan Lever Ltd,
Wdecided to start a unique format of retailing service in India; electronic retailing. It
began its services under the name of SangamDirect in 2001 and seems to be still going
strong. SangamDirect can be described as a direct-to-home shopping service offering
goods and services from provisions to home maintenance, from groceries to toiletries,
from beauty to health. It began its first service as test marketing in Thane, a suburb of
Mumbai and certain specific areas of Navi Mumbai. It was now available in most suburbs
of Central, Western and Northern Mumbai.
SangamDirect is a grocery-delivery service to homes with an aim to turning grocery
purchasing from a mundane to pleasurable experience. The 24-hour
service delivery concept involves selling branded goods at a one per
cent discount to maximum retail price (MRP), and unbranded goods at a
five per cent discount to existing rates. Sangam Direct set up call centers
and a website where consumers can send in their requests for goods and
services. To promote this unconventional service, HLL had also launched a community-
building programme called ‘Thane Sangam’ on select cable television channels.
SangamDirect could be described as an online kirana-store – where line is defined as
telephone as well as website. It does not have an outlet where customers can come to shop.
Instead, all orders must be booked via phone or though its website and the company
promises delivery in 24 hours.
The advantages are many. Clients can dial-in at any time or log-on to their website to
book an order. HLL has set up a call center where company’s agents are trained to provide
all assistance to buyers. To help deal with any first time apprehensions of the customer,
SangamDirect also sends a customer service agent to their house who will help them set
up a shopping service that is fully customized to their individual needs. The website also
has a very comprehensive help facility.
Since there are no constraints of shop space, the company is in a position to offer a
particularly, big range of over 5,000 household products. The most important point is that
these are not just HLL products. Other corporate retailing ventures have all too often
turned out to be mere showcases only for the company’s range. SangamDirect, however,
has an ulterior motive up its sleeve. The customer who orders does it through his telephone,
which de facto becomes his Identification number, and HLL/SangamDirect is now in a
position to track consumer spending habits as well as family profiling! SangamDirect is
definitely a serious retailer, which stocks products from HLL’s competitors as well.
These products are categorized into 11 segments like provisions, toiletries, laundries and
dish wash, home maintenance, beverages and drinks, chips and so on. HLL has used its
national sourcing advantage and the much larger inventory that SangamDirect can keep
to procure local or ethnic products from around the country. Thus it can now market to
members of that ethnic community settled in that area. So if one wanted that particular
sambhar masala, one did not have to trek to the Tamil shops in Matunga – it was just a
phone call away at SangamDirect. That’s the sort of smart trick, building on the company’s
strengths and giving SangamDirect a unique advantage, which may just be what starts
pulling consumers in.
Contd...

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