“We are doubling the incentives for our staff and also the brand promoters who work in the store. The brands are also expected to roll out higher incentives this festive season which can range from electronic goods to holiday packages,” said Nikunj Patel, president of All India Mobile Retailers Association (AIMRA), Gujarat.

The festive season, which starts from September and runs till December-end, sees a flurry of discounts and a battle between offline retailers and online platforms for customer traction.

However, manpower continues to remain a challenge as many retail staff have quit during two years of covid when offline stores were shut.

Meanwhile, consumer expectations have evolved with industry experts saying retailers are stepping up employee training programmes and incentives to ensure better service levels at stores.

Typically, the incentive scheme during the festive season is multi-pronged. Consumer brands offer incentives to retailers and even promoters who represent the brand and remain for the period in the store, to ensure the correct sales pitch to a potential customer. Retailers too, have their own incentive scheme, which is target-based for their own staff.

South India-focused Sangeetha Mobiles is taking up its employee incentive programme a notch higher this year by offering free foreign trips for top-performing employees. In all, the retailer has over 800 stores and 3,000 on-roll employees; another 2,500 employees are off-rolls.

The renewed sales thrust comes as the Indian mobile phone market, the world’s second-largest, shrank for the third straight quarter in the three months ended March, according to Counterpoint Research. This is prompting retailers to step up aggressive offers and on-ground engagement with buyers during the crucial festive season.

“Incentives are part and parcel of business throughout the year, but they double-up during the festival season. In fact, we have planned foreign trips for some of our people who have been top performers,” said Subhash Chandra, managing director at Sangeetha Mobiles. The incentives come on the back of an increase in the average selling price of consumer electronic items by about 10% over the last one year.

“Our store staff makes ₹7000- ₹35,000 every month as bonus depending on their targets achieved. This year, we expect 30% more sales during the festive period compared to the earlier months,” said the owner of a retail chain who has more than 100 electronic shops in Gujarat and Maharashtra. Mohan Bajoria, director of Bhajanlal Commercial Pvt. Ltd, with 25 stores in West Bengal, Assam, and Meghalaya, said brands may roll out incentives like holiday vouchers and gold coins for high ticket sales.

Meanwhile, the retail industry is expecting an improvement in festive demand going into the current quarter

Demand for discretionary demand remained weak in the March quarter as high inflation has continued to strain household budgets. Retailers are thus hinging high hopes on the festive season.

Companies are stepping up investment in employee training and improving the general customer service levels, said Kumar Rajagopalan, CEO, Retailers Association of India. RAI represents a wide range of retailers across categories and channels. Retailers are also seeking employees with better experience. Incentives and rewards will be greater this year.

“Most of the large retailers are creating rewards and recognition concepts rather than just incentives. This festive season we will see lots more opportunities by retailers to create value for consumers. Every retail company has got something for high potential employee be it profit-linked incentives, recognition program like foreign trips,” he said. Rajagopalan expects greater adoption of such programs across the industry.

Rajagopalan said consumer expectations have changed too; consumers are more present across multiple channels, this is prompting retailers in general to step up employee engagement tools.

Updated: 04 Aug 2023, 11:24 PM IST