Here are the reasons why numerous online-first or direct to consumer brands are opting to open kiosks instead of full-fledged stores
Bengaluru: In recent years, retail brands worldwide have been increasingly adopting the kiosk model as a key component of their business strategies. The model is poised for growth, emerging as the preferred store format for many online-first direct to consumer (D2C) brands to venture into physical retailing.
India is no exception to this trend. From beauty and fragrance products to food and confectionary items, kiosks are gaining favour across various retail categories.
Let’s take a look at the reasons why numerous brands are opting for kiosks instead of traditional brick-and-mortar stores…
- Cost efficiency
Setting up and maintaining a kiosk is often more economical than operating a full-fledged brick-and-mortar store. Retailers can save on expenses such as rent, utilities and staffing.
“The kiosk model is gaining traction in India and continues to be promising as it is not a big investment,” said Srishti Rai, co-founder of Soezi, the press-on nail brand co-founded by Bollywood actress Sonakshi Sinha.
The brand entered offline space by launching its first kiosks at Seasons Mall, Hadapsar in Pune.
“Kiosks are typically more cost-effective than traditional brick-and-mortar stores, enabling brands to allocate resources more efficiently, mitigating the financial strain posed by high rental expenses and to achieve higher profit margins,” said Pallavi Sharaff, co-founder of the Haryana-based cosmetic brand O&O Beauty which has kiosks in New Delhi.
The lower capital expenditure associated with establishing a kiosk presents a promising opportunity for further expansion, felt Samir K. Modi, founder of the New Delhi-based brand Colorbar Cosmetics, which owns a network of 75 kiosks, strategically positioned across 54 cities.
“Furthermore, the scalability of this model empowers brands to efficiently evaluate and quickly respond to shifting consumer preferences,” he said.
- Consumer engagement
In addition to the financial aspect, kiosks provide a more intimate and personalised shopping experience, enabling brands to cultivate deeper connections with their customers.
Kairavi Bharat Ram, founder of cosmetic retailer Typsy Beauty chose the D2C route to establish a stronger connection with its customers and streamline its distribution process. However, the brand wanted to engage customers better by offering a platform of touch and feel and face-to-face interactions.
“As a makeup brand, we understood the importance of allowing customers to engage with our products physically before making a purchase, hence the need for a hybrid model including physical kiosks,” said Ram.
The beauty brand, which opened its third offline kiosk in March, is targeting the launch of eight to 10 kiosks across the country in 2024.
- Flexibility and mobility
Owing to its compact size and portable nature, kiosks offer flexibility for brands, allowing them to target high-traffic areas. It can be set up temporarily as pop-up shops or for seasonal promotions, allowing them to capitalise on trends in real time.
For Soezi, agility and ease of operations were among the key reasons to take the kiosk route.
“Start-ups benefit greatly from agility due to simplified management and maintenance. India has a dynamic customer base and it is important to be out there and build presence,” said Rai.
Multi-brand diner Isthara, ventured into the kiosk model, recognising the growing demand for convenience among consumers, especially in urban areas where people lead fast-paced lifestyles.
The kiosk model allowed the brand to establish a presence in high-footfall locations such as shopping malls, transportation hubs, and commercial complexes, maximising its visibility and accessibility to potential customers.
“The flexibility offered by kiosks allowed us to experiment with different product offerings and marketing strategies, enabling us to adapt quickly to changing market dynamics,” said Vijay Kumar, co-founder of Isthara.
Kumar shared that the company plans to launch about 35 multi-brand diners in 2024.
- Foot traffic and accessibility
Kiosks can be positioned in bustling areas such as shopping malls, airports and metro stations. Their placement naturally attracts passersby, thereby enhancing foot traffic. From a consumer standpoint, kiosks offer convenience and accessibility, enabling quick purchases or access to essential services without the hassle of navigating large retail outlets.
“The effectiveness of kiosks in driving sales lies in their ability to elevate product visibility through immersive 360-degree presentations that immediately capture the consumer’s attention,” said Modi of Colorbar Cosmetics adding that the company plans to open 15-20 kiosks in fiscal year 2024- 25.
