Dissertation Report Final Printed

7/28/2019 Dissertation Report Final Printed

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JAIPURIA INSTITUTE OF MANAGEMENT, NOIDA Page 1

A DISSERTATION REPORT

ON ROLE

OF MULTIPLEXES

IN ORGANISED RETAILING

Under the supervision of: Submitted By:

Dr. Vikas Nath Ankit Srivastava

PGSF0809

JAIPURIA INSTITUTE OF MANAGEMENT NOIDA

2010


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DECLARATION

I hereby state that the dissertation entitled Role of Multiplexes in Organized Retailing

submitted by me in partial fulfillment of the requirements for the award of PGDM (Services)

is my original work and that it has not previously formed the basis for the award of any

other Degree, Diploma, Fellowship or other similar titles.

Dated: 15 March 2010 Ankit Srivastava

PGSF0809


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ACKNOWLEDGEMENT

Some of us in our growth period are lucky enough to be guided by some truly special

people, who are respected and admired. Some amount of aspiration, motivation and

creativity is required at every step and we need some people to provide us right guidance

to do our work.

For any project to be undertaken there has to be certain amount of inputs provided by a lot

many people around us. While the number of people who supported me throughout the

project are numerous but some deserve special attention.

I would like to express my sincere thanks to Prof Vikas Nath (Faculty, JIM Noida), my

project guide, for his valuable support. He gave me the opportunity to do this project and

his timely guidance helped me and making this project what it has come out to be.

Ankit Srivastava


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TABLE OF CONTENTS

S.No. Particulars Page No.

College Certificate

Student Declaration I

Acknowledgment II

Executive Summary III-IV

Chapter-1 Overview of Retail Sector 1-11

Chapter-2 Introduction to Study 12-13

Chapter 3 Introduction of Major Multiplexes 14-20

Chapter-4 Literature Review 21-23

Chapter 5 Research Methodology 24-25

Chapter-6 Research Findings & Analysis 26-43

Chapter-7 Conclusions 44-45

Chapter 8 Limitations & Suggestions 46- 48

Annexures

Bibliography 49

Questionnaire


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LIST OF FIGURES

PARTICULARS PAGE NO.

FIG 1.1 TRADITIONAL RETAILING IN INDIA 03

FIG 1.2 MORDERN RETAILING IN INDIA 03

FIG 1.3 EXPECTED RETAIL SPACE TILL 2010-11 05

FIG 1.4 REVENUE SHARING TREND IN MULTIPLEXES 07

FIG 1.5 AGE WISE DISTRIBUTION OF CINEMA VIEWERS IN INDIA 10

FIG .3.1 PVR CINEMAS LOGO 15

FIG 3.2 JAM CINEMAS LOGO 15

FIG 3.3 DTCINEMAS LOGO 15

FIG 3.4 WAVE CINEMAS LOGO 15

FIG 3.5 ADLABS LOGO 15

FIG 6.1 COMPONENT PLOT IN ROTATED SPACE 31


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EXECUTIVE SUMMARY

Introduction to Organized Retail

As India can boast high of its growth story, the retail sector in the country is coming across

opportunities like never before. Retailing, India's largest industry and one of the biggest

sources of employment in the country (40 million people), generates more than 10 per cent

of India's GDP. The sector is at an inflexion point where the growth of organized retailing

and growth in the consumption by the Indian population will take a higher growth trajectory.

People now do not have the time to search for different products at different places and like

them to be available under one single roof. This has led to the development of what we call

as MALLS all around. Along with the malls, there are multiplexes also which are

developing very fast and have become a major source of entertainment for all.

The cinema exhibition industry in India is growing at 10% per annum driven by multiplexes,

which are expanding rapidly in major metropolitan cities as well as second and third tier

cities. Favorable demographics in a cinema-crazy nation, tax exemptions, and quality

locations such as malls, are driving growth of multiplexes in India.

Introduction to Study

The study focused on understanding the importance and role of multiplexes as a key factor

in the development of malls and of the organized retail. It also focused on the issue that

whether multiplexes play any role in driving footfalls in the stores or not. The study would

be beneficial for the developers as well as the marketers to formulate their strategies in

future.


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Research & Analysis

Exploratory and descriptive research has been used to carry out the study. A sample size

of 50 respondents is studied. Factor Analysis and Chi-Square test is conducted on SPSS

software to get to the result. Primary as well as secondary data is collected from sources.

The study of factor analysis revealed that malls should necessarily have good spacious

parking. The customers enjoy shopping with their families and friends and also like to visit

retail stores after the movie. So the developers and the retailers should mutually try to

make the visit of the customers a memorable experience. Together it will increase footfalls

and sales and thus revenues.

Through the study of Chi-Square test using different variables like age, income, marital

status, day and time of visiting malls, the type of stores the customer is visiting, his average

expenditure etc. we get to know the dependency of variables on each other and thus more

informed strategies can be implemented.

Limitations

The study is limited to the variables under consideration and the results are based upon theresponses of the respondents. The results are strictly relative and not absolute.

In the end I would like to conclude that malls and multiplexes mutually benefit each other

and cannot grow in isolation. Thus there is a need to be aware and work in coordination for

the overall growth of organized retail which would actually benefit all.


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CHAPTER 1

OVERVIEW OF RETAIL SECTOR


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CHAPTER 1: INTRODUCTION

1.1 OVERVIEW OF THE RETAILING INDUSTRY

Retail is one of the largest sectors of India accounting for over 10 percent of GDP and 8

percent of employment. Global Retail Development Index (GRDI 2008) ranks India as the

second most attractive destination for retail investments after Vietnam among 30 emerging

economies. Economic growth, changing lifestyles, favorable demographics, urbanization,

and the development of IT are key factors accounting for growth of this sector. It is the

fastest growing sector of the economy with a compounded annual growth rate of 46.64

percent. The estimated worth of organised retail is Rs 350 billion which is just about 3

percent of total retail market.

Indian retail industry is witnessing a paradigm shift and the consumers are seeking one

stop shopping place with convenience, entertainment and add ons. India is stepping into

new era of Retail Chains from the traditionally managed Kirana Stores. The Indian

population is witnessing a significant change in its demographics. A large young working

population with median age of 24 years, nuclear families in urban areas, along with

increasing working-women population and emerging opportunities in the services sector

are going to be the key growth drivers of the organized retail sector.

The retail sector in India is witnessing a huge revamping exercise as traditional markets

make way for new formats such as departmental stores, hypermarkets, supermarkets and

specialty stores. Western-style malls have begun appearing in metros and second-rung

cities alike introducing the Indian consumer to a shopping experience like never before.

The sector is at an inflexion point where the growth of organized retailing and growth in the

consumption by the Indian population will take a higher growth trajectory.


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FIG 1.1 TRADITIONAL RETAILING IN INDIA

FIG 1.2 MODERN RETAILING IN INDIA

Source: The Great India Retail Story, FIG 1, ERNST & YOUNG


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1.2 INDIAN CONSUMER BASE

890 million below 45 years Largest young population in the world

More English speaking people than the whole of Europe

300 million middle class (Real consumers) to grow to 600 million by 2011

550 million people would be below the age of 20 by the year 2015

70 million earning over Rs 8 lacs annually which will grow to 140 million by 2011.

1.3 GROWTH OF MALLS

Over the last 5-6 years, the Indian consumer market has seen a significant growth in the

number of modern-day shopping centers, popularly known as malls. Malls are springing

up in every city and are fast becoming sought-after entertainment hotspots, with shopping

as the by-product. There is an increased demand for quality retail space from a varied

segment of large-format retailers and brands, which include food and apparel chains,

consumer durables and multiplex operators. Mall growth is being seen as a clear indicator

of the economic prosperity in India.A report called Winning with Intelligent Supply Chains,

gives relevant information about the development of malls, the space required and about

the future of organized retailing. . It states that organized retail is likely to touch $30 billion

by 2010 from the .$14 billion in 2008 'The sector is expected to grow rapidly to reach $30billion by 2010 driven by the increasing number of nuclear families, working women, greater

work pressure, easy accessibility and convenience. 'The growth in the retail sector has

driven a mall building boom across the country, with the total number of malls expected to

increase to 600 by 2010 from 158 in 2005. Many factors such as availability of physical

space, population densities, city planning, and socio-economic parameters have driven the

Indian market to evolve, to a certain extent, its own definition of a mall. The malls in India

need to have a clear positioning through the development of differential product assortment

and differential pricing, in order to compete effectively in a growing mall market.

Segmentation in malls, like up-market malls, mid-market malls, etc. ,proper planning,

correct identification of needs, quality products at lower prices, the right store mix, and the

right timing, would ensure the success of the mall revolution in India.


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FIG 1.3 EXPECTED RETAIL SPACE TILL 2010-11

Source: Morgan Stanley Research

The above figure gives us the snapshot of the scope of organised retailing in the years to

come. The demand for such formats like departmental stores, hypermarkets, super

markets, multiplexes is increasing at very fast pace and it is possible because of having

quality retail space in the form of Malls.


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1.4 INDIAN CINEMA EXHIBITION INDUSTRY

The cinema exhibition industry in India is growing at 10% per annum driven by multiplexes,

which are expanding rapidly in major metropolitan cities as well as second and third tier

cities. Favorable demographics in a cinema-crazy nation, tax exemptions, and qualitylocations such as malls, are driving growth of multiplexes in India. Rising income levels and

willingness of people to spend on quality entertainment are increasing footfalls in the

multiplexes.

The industry is characterized by seasonality, low screen density, increasing average ticket

prices, and reducing shelf life of movies. India's craze for films has not been fully exploited

by the "Film Exhibition" industry due to the lack of screen density in the country coupled

with the poor quality of screens. India currently has 11500 existing screens, 95% arestandalone, single screens. These single screen cinemas are poorly maintained as the

owners find it difficult to upgrade and renovate their facilities, due to unavailability of

organized finance. The deteriorating quality of these cinemas dissuaded viewers and they

started using alternative viewing options.

"Multiplex Cinemas" offer an alternative to tap this potential by providing a quality

experience to the viewer as well as economies to the multiplex operator. Over the last few

years, multiplexes have emerged as a trend in urban India. "Multiplexes" are essentially

cinemas with 3 or more screens. They provide a quality viewing experience and are

generally located around shopping malls to increase footfalls in these malls. With the

increasing popularity of multiplexes among Indians, the concept of film business in India

has gained a new dimension. Reports indicate that multiplexes account for 0.6 per cent of

the total cinemas, 2.3 per cent of the total screens and have a total capacity of more than

two lakh seats.


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FIG 1.4 Revenue Sharing trend in multiplexes

With around 11500 active screens, India is under screened. China, which produces far

lesser films than India has 65,000 screens while the US has 36,000. Indias screen density

stands low at 12 screens per million populations. There is a need of at least 20,000 screens

as against the current 11500. This gives multiplex operators enough room to grow as the


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traditional single-screen theatres do not have the financial wherewithal nor do they enjoy

tax incentives.

The bullish outlook on the retail industry is tended to have a spillover effect on multiplexes.

Multiplexes are considered as one of the anchor tenants in shopping malls as they increasefootfalls by around 30%-40%. Thus the expected growth in organised retail industry would

result in significant jump in multiplexes across the country. It is important for multiplexes to

be located in premium malls, which have presence of strong brands. The tenant-mix of the

mall often decides the success of the mall and in turn the success of that multiplex.

Branded retailers also offer opportunities of cross-pro motions, which help both businesses.

Multiplexes are a perfect example of convergence of retail and entertainment across the

mall and high-street (organised shopping formats).We can say that multiplexes act as

catalysts for retailing in malls and high-street markets. Studies by KPMG shows that

multiplexes increase footfalls by a whopping 40 to 50 per cent. In today's booming market,

retailers and multiplexes are mutually beneficial to each other. Therefore, it would be

difficult to view any of them separately.

Out of the three constituents of a mall viz. entertainment, shopping and eating out,

multiplex is the most capable traffic-generator. When people come to watch a movie, they

eat out and also shop. Mall developers all over the country prefer that, therefore,

multiplexes occupy their top floors so as to act as anchor tenants and ensure high footfalls.

The traffic flow and layout of the mall are so planned that they ensure that consumers

reach the cinema afterexperiencing and exploring retail (food, shopping and other leisure

facilities) areas of the mall. People generally come to a mall with the intention of watching a

movie and end up by making major purchases. But, it could be the other way, too. A mall

could be a pleasure destination with the multiplex merely being just one of the options. With

both the options in hand, this is definitely an example of the classical chicken and egg

question.

Studies show that, in today's world, fun, food, films and fashion make a pertinent and

potent mixture to attract discerning consumers who want their needs to be met under a

single roof. Thus, association of malls with multiplexes is very important. The reason being


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that nowadays cinema-going is not merely about watching a film but about an overall

experience.

1.5 GROWTH DRIVERS

At a time when single-screen theatres are dying due to lack of footfalls, people are queuing

up at multiplexes that sell tickets at almost 5 times the prices prevailing in single-screen

theatres. This fact provides ample testimony to the increasing prosperity as well as the

Indian consumers willingness to pay for superior-quality entertainment. Given the

prevailing demand-supply dynamics, we believe that the sector offers high visibility for

steady cash flows.

1.5.1 SUPPLY SIDE: IMPROVING DYNAMICS

1.5.1.1Content supply set to boom

Multiplexes are in existence because people want to watch movies in a quality ambience.

Hence, as a direct corollary, more footfalls will be generated with more movies being

released. In this sense, the multiplex operator can do nothing but depend on the suppliers

of content (movie producers and distributors) for a regular and high-quality supply of

content to generate higher number of footfalls. Content supply is set to boom in the coming

years mainly because of the following factors:

a) Increasing investment in film production

b) Reducing shelf life of movies making multiplex the ideal format for distributors

1. Real Estate Supply

Multiplexes are often regarded as the footfall magnets for malls. The concept of shopping-

cum-dining- cum-entertainment outing is gaining popularity among the urban populace,

where multiplexes in malls become the most relevant destination choice. Almost all

upcoming malls have a multiplex operator as an anchor tenant. Hence, we believe that the

supply of real estate will not be an issue for the sector, even though the pace might be slow

due to development delays.


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Encouraging regulatory environment

All entities linked to the entertainment space are required to pay entertainment tax, which is

a state subject. Entertainment tax in the past was as high as 100% of the ticket revenues in

some states, which made exhibition projects unviable in many cases. However, many state

governments appreciate and understand the need to rationalize E-tax levels and have

provided for either entertainment-tax exemptions for multiplex operators or reduction of e-

tax to more affordable levels.

1.5.2 DEMAND SIDE: STRONG PULL

1.5.2.1 Increasing consumer spending

India is a highly favorable country for consumer industries with all the key indicators

pointing towards higher consumer spends in the coming years. It has seen its per capita

income doubling in the last 6 years, it has more than 60% of its people under the age of 60,

urbanization and exposure to western lifestyle is rising, all leading towards increasing

consumerism in the coming decade. In the buoyant times; people tend to spend more on

the leisure based consumption. For the multiplex sector, the target group is in the age

group of 15-60 years of age, which visits the theaters more often than others .

FIG 1.5 Age Wise distribution of cinema viewers in India

Source: IRS Media trends


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1. People willing to pay for quality

With the entry of multiplexes, which provide better quality movie watching experience at a

higher price compared to single screen theaters, more and more middle income group

people are coming back to the theatres thus unlocking a latent demand. This is a classic

case of leisure consumption winning over value proposition in India. As content supply

booms, more and more people will turn to multiplexes because of the rising willingness of

people to pay for such services.


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CHAPTER 2

INTRODUCTION TO STUDY


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CHAPTER 2: INTRODUCTION TO STUDY

2.1 NEED OF STUDY

The study is needed to understand the importance of multiplexes as a key factor in driving

the growth of organised retail. The study also focuses upon issues like do multiplex help in

generating footfalls in the mall and the stores. The study can be important for the

marketing students to get an insight about organised retail and the factor driving its growth.

2.2 SCOPE OF STUDY

The study would be helpful for the retailers, developers and the marketers to make their

future strategies and decisions in a more informed manner. The study has revealed the

interdependency between multiplexes and malls and thus new innovative techniques can

be adopted by the marketers for mutual benefits.

2.3OBJECTIVES OF STUDY

a) To understand the importance of multiplexes as a growth driver in organized retailing.

b) To know whether play a role in driving sales of retail stores in a mall.

c) To know whether multiplexes generate loyalty among customers for a particular mall.


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CHAPTER 3

INTRODUCTION TO MAJOR

MULTIPLEXES


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FIG .3.1 PVR CINEMAS LOGO

FIG 3.2 JAM CINEMAS LOGO FIG 3.3 DTCINEMAS LOGO

FIG 3.4 WAVE CINEMAS LOGO FIG 3.5 ADLABS LOGO


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CHAPTER 3: MAJOR MULTIPLEXES

3.1 PVR CINEMAS

PVR Limited (PVR) is a leading, premium multiplex cinema exhibition company with a

growing presence across various verticals of the lifestyle entertainment domain. PVR

pioneered the multiplex revolution in India by establishing the country's first multiplex

cinema in 1997 and the largest 11-screen multiplex cinema in 2004. As of June 2009,

PVR's geographically diverse cinema circuit in India consists of 108 screens across 27

cinemas. With close to 18 million patrons annually, PVR is one of Indias most recognized

film exhibition brands. The organization's systematic, proven site selection model for project

evaluation and approval, consistently pinpoints prime locations packed with revenue

generation potential which successfully translate into robust revenues.

PVR has strong, deep relationships with the real estate industry and has long been

regarded as a key anchor tenant by leading real estate developers across the country

because the organization's footfalls and environments significantly drive the revenues of

surrounding retail development.

PVR's huge emphasis on marketing and promotion, implementation of uniform operational

systems, processes and customer-oriented service procedures have built excellent brand

equity with viewers. PVR earns its revenues from 3 main sources viz. Film exhibition,

production and distribution and Lifestyle Entertainment.

3.1.1 FILM EXHIBITION

The company's primary source of revenue is from the exhibition business. It currently

operates 108 screens across 17 cities comprising of 27827 seats across the nation under

the lease model. The company has a greater bargaining power for the lease rentals as

compared to the other players given the higher occupancy levels and footfalls commanded

by the company.


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The company is planning to come up with 43 more screens across the country comprising

of around 10750 seats. Post FY10, the company plans to come up with 35-40 new screens

every year. The company has always had its multiplexes at strategic locations and they

plan to do similarly in the future as well. More than 75% of its screens are located in the

Tier I cities. In the Tier II cities it is mostly located in the only mall of the city or at places

near the railway station thus giving them an upper hand as compared to any other

competition that may arise in the future. The Company carries on an intense market

research program as to have an overview of the lifestyle, preferences and habits of the

target customers before deciding on any location for a future multiplex. The company has

major presence in the northern part of the country, mainly in Delhi, Gurgaon etc. Out of the

total screens around 49% comprise of the screens in northern India. In the western regionthe company has 11231 seats which comprise 40% and in South India it is only 11%. The

company has no presence in the eastern region of the country. . The Company registered a

growth of 7% in the footfalls from around 17 million patrons at its cinemas during FY 2009

as compared to 15.8 million patrons during the FY 08.

1. FILM PRODUCTION & DISTRIBUTION

The company is in to Production and Distribution of movies through its subsidiary PVR

Pictures. PVR Pictures is in to Production and Co-Production of Bollywood movies and into

Distribution of both Bollywood and Hollywood movies. The company has planned to launch

about 4-5 annually so as to become a trusted and an established brand of the country in

the years to come.

2. LIFESTYLE ENTERTAINMENT

PVR entered into a 51:49 JV with Major Cineplex Group, a leading Film exhibition and retail

entertainment company based out of Thailand, to bring lifestyle entertainment concepts to

Indian consumers with a brand name PVR Blu-O.The first project is India's largest, 24 lane

bowling center at Ambience Mall, Gurgaon which commenced operation in Q4FY09. It is


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the largest bowling center in India and is positioned as a premium leisure and

entertainment destination in Delhi / NCR.

3.2 ADLABS CINEMAS

Adlabs has presence in all of the three major segments in movies i.e. production,

distribution and exhibition. The integrated model adopted by Adlabs gives it a competitive

edge over others in terms of capturing value at each level of the value chain. However, it

also exposes the company to more risks as risks of one segment are prone to disturb the

other segments. The segments are

3.2.1 Exhibition Segment - The largest player

Adlabs has 201 screens under operation at present, making it by far the largest player in

the exhibition space. It has a two pronged strategy of expansion - opening multiplexes at

the prime locations in the metros and other cities and expanding through renovating

existing single screen theatres in the tier II and III cities which has helped the company add

more than 100 screens in the last two years. Since Anil Dhirubhai Ambani Group has

picked up the majority stake in the company, it has shown even more aggression in its

expansion plans by acquiring Rave Cinemas, chain of multiplexes in India and Lotus Five

star, an exhibition player in Malaysia. Both of these acquisitions have given Adlabs a head

start in its expansion plans as compared to other players. Adlabs has forayed into

production and distribution of film and TV content since 2005. It plans to release 6-7 movies

per year with varying genres and budget.

1. Film Processing - Leader controlling 70% of market share

Adlabs started as an ad films processing facility. The company has made fast strides in this

business and today controls 70% of the film processing market in the Western part of the

country. It has set up film processing facilities in Chennai and Kolkata to tap growing

regional markets there. With the growing fold of the company in film entertainment

business, this division is expected to benefit in the coming years.


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Adlabs has shown the most aggression in its expansion plans so far, mainly because of

access to the deep pockets of ADAG group. It has entered into an agreement with Rave

Entertainment to acquire the right to conduct cinema exhibition business at the 23 screens

that the group is developing in NCR, Uttar Pradesh, Punjab and Haryana. This gives the

company access to 6 properties, 4 of which are tax exempt. Recently, the company has

acquired majority skate in Malaysia-based Lotus Five Star Cinemas and will be operating a

51 screen cinema chain in across Malaysia.

3.3 DT CINEMAS

DT Cinemas, a wholly owned subsidiary of the DLF Group started its first Multiplex at DLF

City Centre in Gurgaon on 7th March'2003 with a vision to create a comprehensive retail

experience for Indian Consumers with the best retail entertainment. DT Cinemas acts as a

robust footfall driver as "Entertainment Anchor" for DLF malls. Currently 26 screens are

operational which are spread across six locations in Delhi (Vasant Kunj, Saket and

Shalimar Bagh), Gurgaon (Mega Mall & City Centre) and Chandigarh with seating capacity

of more than 5300 seats. DT Cinemas will soon be opening on a pan India presence at

cities like Mumbai, Bangalore, Calcutta, Hyderabad, Goa, Ludhiana, Noida to name a few.

DT Cinemas has imported its state-of-the-art projection systems from Christie, the US-

based company known to have one of the best projection systems in the world whichprovides for its outstanding visual experience. Advanced equipment for automatic

formatting (Flat format etc.) is used to deliver both Hindi and English movies at same

quality levels.

DT Cinemas has marked its presence in the industrythrough its unique services. It is just

six years old but it has been successfully able to manage a place for itself in the stiff

competition from the big giants like PVR and BIG Cinemas.

3.3 WAVE CINEMAS

One of the unique ventures of Wave Inc., is Wave Cinemas the Groups own Movie

Theater with its pioneering adoption of international standards of equipment which has

changed the way the nation watches movies.Traditional to Wave Cinemas, is the world-


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class Digital Sound, Audio and Projection systems, with seating ergonomically designed

comfortably wider, having more leg-room than the present industry standards.

With projection systems from Kinoton-Germany, Audio Systems from Martin Audio-UK,

Screens from Harkness Hall-UK and Dolby Cinema Processors from USA, movie viewingat Wave Cinemas is definitely a distinctive experience for the populace.

The Wave Cinemas at selected venues offer the star attraction and revolutionary concept -

the Platinum Lounge a royal luxurious movie-viewing experience, which is

conceptualized, designed, implemented and offered only by the "Wave Cinemas".

Its focuses on Redefining the world of movie-viewing experience..

3.5 JAM CINEMAS

'Just About Movies' (JAM) has one of the widest and the largest screens in India. It is a

state of art 3 screen multiplex located in the ever fascinating Shipra Mall. Shipra Mall

commits to offer a unique shopping experience and entertainment. The mall has been

designed as a one-stop-destination for entertainment and leisure. JAM has always been a

key of driving large crowd in the Shipra Mall.

JAM, the 1135 + 18 Platinum Class seater 3 screens Multiplex is one of the finest in the

city. It has been designed keeping in view the best of Cinema experience. Just about

movies has got everything that a cinema lover would like to have. Comfortable seating, the

best of carpets and air conditioning systems, the best of sound systems, the quality of

picture and a rich hospitality which actually makes the experience of cinema goers luxury

par excellence.

Just About Movies Multiplex since its inception has been serving the needs of the

customers by continuously upgrading its services and processes. Shipra Group is in its

expansion mode and is developing another mall in Ghaziabad on the landmarks of Shipra

Mall and will house Just About Movies Multiplex there as well.


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CHAPTER 4

LITERATURE REVIEW


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CHAPTER 4: LITERATURE REVIEW

4.1 LITERATURE REVIEW

Organized retailing provides an ideal shopping experience through consumer preference

analysis, pleasant ambience and choice of merchandising. Rising income levels and

changing lifestyle of Indian consumers have completely changed the way what traditional

retail used to be. Organised retail driven majorly by the multiplexes is stepping up the

growth trajectory.

India currently has 11500 existing screens, 95% are standalone, single screens. These

single screen cinemas are poorly maintained as the owners find it difficult to upgrade and

renovate their facilities, due to unavailability of organized finance. The deteriorating quality

of these cinemas dissuaded viewers and they started using alternative viewing options.

Over the last few years, multiplexes have emerged as a trend in urban India. "Multiplexes"

are essentially cinemas with 3 or more screens. They provide a quality viewing experience

and are generally located around shopping malls to increase footfalls in these malls. Each

screen in a multiplex has small seating capacities in the range of 150-300 seats as

compared to single screen cinemas which have capacities in the range of 800-1,200 seats.

Indias screen density stands low at 12 screens per million populations. There is a need of

at least 20,000 screens as against the current 11500. This gives multiplex operators

enough room to grow as the traditional single screen theatres do not have the financial

wherewithal nor do they enjoy tax incentives. The multiplex has gone beyond the metros to

redefine entertainment in Tier 1 and 2 cities.

With the increasing popularity of multiplexes among Indians, the concept of film business inIndia has gained a new dimension. Reports indicate that multiplexes account for 0.6 per

cent of the total cinemas, 2.3 per cent of the total screens and have a total capacity of more

than two lakh seats. At multiplexes, ticket price varies usually from Rs 75 to Rs 350. The

average gross collection per multiplex is around Rs 5.72 crore. Thus, multiplexes fetch


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CHAPTER 5

RESEARCH METHODLOGY


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CHAPTER 5: RESEARCH METHODLOGY

5.1 RESEARCH METHODOLGY

Research Methodology is one of the important aspects of any project. This gives us clear-

cut view of method so used while gathering the information so needed for the completion of

the report.

5.1.1 Research Objective

The study is titled Role of Multiplexes in Organized Retailing. The study involved

identifying and analyzing the key issues of organized retailing and the importance of

multiplexes in boosting the organized retail.

5.1.2 Type of Study: Exploratory and Descriptive Research

5.1.3 Period of Study: December 2009- March 2010

5.1.4 Sample Size: A sample of about 50 respondents was collected for the study.

5.2 Data Collection

Primary as well as secondary data was used for the study. Primary data had been collected

through personal interviews and structured questionnaire filled up by the people visiting the

malls and the retailers out there. Secondary data had been collected from different sources

like retail magazines, websites, newspapers, journals etc.

5.2.1 Statistical Tools Used

Factor Analysis and Chi Square test has been used through SPSS.


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CHAPTER 6

RESEARCH FINDINGS

&

ANALYSIS


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CHAPTER 6: RESEARCH FINDINGS & ANALYSIS

6.1 RESEARCH FINDINGS & ANALYSIS

The study was undertaken to examine the importance of multiplexes as a growth driver inorganized retailing. Also to analyse whether multiplexes help in driving sales of retail store

and generate loyalty among the customers for the same mall. For this purpose the

researcher had collected data from 50 respondents. The researcher had formulated 14

hypotheses and analysis had been done through factor analysis and chi square test by

using SPSS software.

6.2 FACTOR ANALYSIS

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .518

Approx. Chi-Square 88.095

Df 91

Bartlett's Test of Sphericity

Sig.

.567

a. Based on correlations

TABLE 6.1 KMO and Bartlett's Test

INTERPRETATION

Since the KMO and Bartletts Test is coming out to be more than 0.5, i.e.0.518 thus we can

proceed with the factor analysis.


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TOTAL VARIANCE EXPLAINED

Initial Eigenvaluesa

Extraction Sums of Squared

Loadings Rotation Sums of Squared LoadingsCo

mp

one

nt Total

% of

Variance

Cumulati

ve % Total

% of

Variance

Cumulativ

e % Total % of Variance

Cumulative

%

1 2.320 16.203 16.203 2.320 16.203 16.203 1.797 12.547 12.547

2 1.792 12.512 28.715 1.792 12.512 28.715 1.745 12.187 24.734

3 1.672 11.677 40.392 1.672 11.677 40.392 1.295 9.048 33.782

4 1.433 10.010 50.402 1.433 10.010 50.402 1.430 9.990 43.771

5 1.386 9.680 60.082 1.386 9.680 60.082 1.763 12.315 56.086

6 1.045 7.298 67.380 1.045 7.298 67.380 1.617 11.294 67.380

7 .959 6.701 74.081

8 .803 5.611 79.692

9 .709 4.952 84.644

10 .571 3.988 88.632

11 .483 3.372 92.005

12 .441 3.078 95.082

13 .382 2.668 97.750

14 .322 2.250 100.000

10 .571 3.988 88.632

11 .483 3.372 92.005

Raw

12 .441 3.078 95.082


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13 .382 2.668 97.750

14 .322 2.250 100.000

TABLE 6.2 TOTAL VARIANCE EXPLAINED

INTERPRETATION

The table of total variance explained helps in extracting out the major components. This is

done by taking all the components whose value is more than 1. Thus in the above table we

have 6 components whose value is more than 1 and these six components will be

extracted. All further analysis will now be done on these six components only.

ROTATED COMPONENT MATRIX

Component

1 2 3 4 5 6

parking in a mall .486 .413 -.016 .001 .096 .122

security in a mall .036 -.006 -.093 .833 .075 -.059

ambience of a mall -.109 -.100 -.413 -.100 .211 .067

distance of multiplex from home -.061 .606 .032 -.393 .075 -.098

always go to same multiplex .167 -.034 .045 .149 1.165 -.045

compare multiplex before going in for a movie .127 -.001 .063 -.042 -.146 1.191

sitting arrangement in a mall -.393 .150 .243 -.059 .026 .156

visit stores after movie .076 -1.001 .026 -.206 -.059 -.046

Prefer stores in mall as one stop shopping place -.213 .313 -.555 .327 .027 .104

enjoy shopping .774 -.148 -.076 -.502 -.099 -.055


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TABLE 6.3 ROTATED COMPONENT MATRIX

INTERPRETATION

From the above table we get to know that what are the factors which the customer likes to

have together. This is done by identifying the highest values in each row. All the factors

identified should be then given a name which would actually represent them.

Component 1: (Convenience and enjoyment)

Parking in mall, visiting stores after movie, enjoy shopping, visit stores with family and

friends, stores and multiplexes should be there together in a mall.

Component 2:

Distance of multiplex from home.

Component 3: (Comfortable lifestyle)

Sitting arrangement in a mall, watching movie in a multiplex is a status symbol.

Component 4: (Secured Shopping)

Security in a mall, one stop shopping place

Component 5: (service quality)

Ambience, goes to same multiplex, shopping in mall saves time and energy.

Component 6: Compare multiplexes before going to a movie.

visit stores with family and friends .591 -.142 .339 .362 -.122 -.050

watching movie in a multiplex is status symbol -.192 -.010 .775 -.097 .143 .249

store after/before saves time and energy -.192 .169 -.085 -.025 .518 -.083

stores and multiplexes should be there together in a mall .521 .043 .116 .041 -.031 .231


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FIG 6.1 COMPONENT PLOT IN ROTATED SPACE

INTERPRETATION

The objective of conducting factor analysis is to reduce to a manageable number

many variables that belong together and have overlapping measurement

characteristics. In the above case 14 variables have been reduced to 6 components.

The variables in components are interrelated among themselves but components as

a whole are not correlated with each other. The best combination makes up first

component. The second component includes variables for explaining the variance


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not accounted by the first component. In this case the principal component is

convenience and enjoyment. The implication is that malls should necessarily have

good spacious parking. The customers enjoy shopping with their families and friends and

also like to visit retail stores after the movie. So the developers and the retailers should

mutually try to make the visit of the customers a memorable experience. Together it willincrease footfalls and sales and thus revenues.

6.3 CHI SQUARE TEST

Chi-Square test shows that is there any relations or dependency between the variables

under study or not.

1. Age and Day of Visiting Malls:

Null Hypothesis: There is no relation between age and day of visiting malls.

Alternate Hypothesis:There is relation between age of respondent and day of visiting

malls.

Age of respondent * Day of visiting malls Cross tabulation

Day of visiting malls

weekdays weekends Total

Count 9 5 14below 18

% within Age of respondent 64.3% 35.7% 100.0%

Count 12 2 1418-25


Count 0 10 1025-30

% within Age of respondent .0% 100.0% 100.0%

Age of respondent

30 & above Count 0 12 12


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TABLE 6.4 Age of respondent * Day of visiting malls Cross tabulation

CHI-SQUARE TEST

TABLE 6.5 CHI SQUARE TEST

INTERPRETATION

Since the significance value is coming out to be less than .05, it means that the null

hypothesis is rejected. Thus the day of visiting malls depends upon the age of respondent.

It means that a student can visit the malls in weekdays as well as weekends but a

professional might not have time and thus would prefer to visit malls on weekends. The

above table also shows that 100% people under the age group of 25-30 years would like to

visit malls on weekends only.

2. Marital Status and kind of stores visited :

Null Hypothesis: There is no relation between marital status and kind of stores visited.

Alternate Hypothesis:There is relation between marital status and kind of stores visited.

% within Age of respondent .0% 100.0% 100.0%

Count 21 29 50Total


Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 29.768a

3 .000

Likelihood Ratio 38.297 3 .000

Linear-by-Linear Association 19.031 1 .000

N of Valid Cases 50


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TABLE 6.6 MARITAL STATUS * TYPE OF STORES VISITED IN MALL CROSSTABULATION

TABLE 6.7 CHI-SQUARE TESTS

MARITAL STATUS OF THE RESPONDANT * TYPE OF STORES VISITED IN MALL CROSSTABULATION

type of stores visited in mall

Apparels

Food

Outlets

Home

Furnishing

Department

Stores Total

Count 8 10 0 9 27Single

% within Marital status of

the respondent29.6% 37.0% .0% 33.3% 100.0%

Count 8 2 8 5 23

Marital status of the

respondent

Married


the respondent 34.8% 8.7% 34.8% 21.7% 100.0%

Count 16 12 8 14 50Total


the respondent32.0% 24.0% 16.0% 28.0% 100.0%

CHI-SQUARE TESTS

Value Df Asymp. Sig. (2-sided)


3 .003


Linear-by-Linear Association .165 1 .685

N of Valid Cases 50


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INTERPRETATION


hypothesis is rejected. Thus the marital status of an individual impacts the kind of stores

visited by the respondent. It means that a married person would like to visit a home

furnishing store but a single may like to visit food outlets. From the above table we can see

that 37% of the people who are single like to visit food outlets while just 8.7% of people

who are married like to visit food outlets.

3. Occupation and time of day of watching movie

Null Hypothesis: There is no relation between occupation and time of movie.

Alternate Hypothesis:There is relation between occupation & time of movie.

OCCUPATION OF RESPONDANT * TIME OF DAY OF WATCHING MOVIE CROSSTABULATION

Time of day of watching movie

Morning Afternoon Evening Night Total

Count 0 0 8 5 13Professional

% within Occupation of

respondent.0% .0% 61.5% 38.5% 100.0%

Count 0 2 5 8 15Businessman


respondent.0% 13.3% 33.3% 53.3% 100.0%

Count 12 0 0 2 14Student


respondent85.7% .0% .0% 14.3% 100.0%

Occupation of

respondent

Others Count 0 6 1 1 8


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TABLE 6.8 OCCUPATION * TIME OF DAY OF WATCHING MOVIE CROSSTABULATION


INTERPRETATION


hypothesis is rejected. Thus the occupation of respondent impacts his time of watching

movie. It means that a businessman would like to watch the evening and night shows due

to his office engagements but a student would like to see morning or afternoon shows.

From the above table 38% of professionals like go for night shows while just 14% of

students like to go for night shows.


respondent.0% 75.0% 12.5% 12.5% 100.0%

Count 12 8 14 16 50Total


respondant 24.0% 16.0% 28.0% 32.0% 100.0%

Chi-Square Tests



9 .000



N of Valid Cases 50


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4. Average Expenditure and visiting stores with movie

Null Hypothesis: There is no relation between average expenditure incurred by the

respondent and visiting stores with movies.

Alternate Hypothesis: There is relation between average expenditure incurred by the

respondent and visiting stores with movies.

TABLE 6.10 EXPENDITURE IN A MALL * VISIT STORE WITH MOVIE CROSSTABULATION

Visit store with movie

Yes No Total

Count 3 7 100-500

% within Expenditure in a mall 30.0% 70.0% 100.0%

Count 15 4 19500-1000


Count 12 4 161000-1500


Count 3 2 5

Expenditure in a mall

1500 and above


Count 33 17 50Total



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TABLE 6.11 CHI SQUARE TESTS

INTERPRETATION


hypothesis is rejected. Thus the visiting of stores along with the movie depends upon the

average expenditure of the respondent. It means that a person who is spending less than

Rs 500 on a average would not like to visit stores for shopping every time compared to a

person who is spending more than Rs 1500. From the above table we can see that 78% of

people whose average expenditure is between Rs 500-1000 like to visit stores with movie

while just 30% of the people whose average expenditure is less than Rs 500 like to visit

stores with movie.

5. Income and movie in multiplex

Null Hypothesis: There is no relation between income and watching movie in multiplex.

Alternate Hypothesis:There is relation between income and watching movie in multiplex.



3 .049



N of Valid Cases 50

Movie in multiplex

Yes No Total

Count 3 7 10Income of the

respondent

less than 10000

% within Income of respondent 30.0% 70.0% 100.0%


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TABLE 6.12 INCOME*MOVIE IN MULTIPLEX CROSS TABULATION

TABLE 6.13 CHI SQUARE TESTS

INTERPRETATION


hypothesis is rejected. Thus watching movies in a multiplex depends upon the income of

the respondent. It means that a person who is earning less than Rs 10000 per month

would like to watch movies in traditional cinemas compared to multiplex whereas a person

Count 11 4 1510001-30000


Count 13 3 1630001-50000


Count 7 2 950000 and above


Count 34 16 50Total


0



3 .036



N of Valid Cases 50


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who is earning more than Rs 30000 per month would definitely go in for multiplexes only.

As clear from the table above 73% of the people whose income is between Rs 10000-

30000 would like to watch movie in multiplex whereas just 30% of the people whose

income is less than 10000 go in for multiplexes.

6. Watching movies in multiplex and visiting stores in a mall

Null Hypothesis: There is no relation between watching movies in the multiplex and

visiting store in mall by the respondent.

Alternate Hypothesis: There is relation between watching movies in the multiplex and

visiting store in mall by the respondent.

TABLE 6.14 MOVIES IN MULTIPLEX * VISITING STORES IN A MALL CROSSTABULATION

Visiting stores in a mall

Yes No Total

Count 40 0 40Yes

% within Watching movies in

multiplex100.0% .0% 100.0%

Count 7 3 10

Watching movies in multiplex

No


multiplex70.0% 30.0% 100.0%

Count 47 3 50Total


multiplex94.0% 6.0% 100.0%


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INTERPRETATION


hypothesis is rejected. Thus watching movies in multiplex and visiting stores in mall are

dependent on each other. It means that customers like to visit stores also after watching

the movie. That is why multiplexes are placed on top floors so thus customers can visit the

stores also after watching the movie. The above table also shows that 94% of the people

like to visit stores after watching movie in multiplex while just 6% do not like it.

7. Frequency of visiting malls and frequency of visiting multiplex

Null Hypothesis: There is no relation between frequency of visiting malls and frequency

of visiting multiplex.

Alternate Hypothesis:There is relation between frequency of visiting malls and frequency

of visiting multiplex.



1 .000

Continuity Correctionb 8.001 1 .005


Fisher's Exact Test


N of Valid Casesb

50


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FREQUENCY OF VISITING MALLS * FREQUENCY OF VISITING MULTIPLEXES CROSSTABULATION

Frequency of visiting multiplexes

Once a week Fortnightly Monthly Total

Count 2 4 1 7Daily

% within Frequency of

visiting malls28.6% 57.1% 14.3% 100.0%

Count 2 7 10 19Weekly


visiting malls10.5% 36.8% 52.6% 100.0%

Count 4 6 9 19Fortnightly


visiting malls21.1% 31.6% 47.4% 100.0%

Count 3 1 1 5

Frequency of visiting

malls

Monthly


visiting malls60.0% 20.0% 20.0% 100.0%

Count 11 18 21 50Total


visiting malls22.0% 36.0% 42.0% 100.0%

TABLE 6.16 FREQUENCY OF VISITING MALLS * FREQUENCY OF VISITING MULTIPLEXES

CROSSTABULATION


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CHAPTER 7

CONCLUSION


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CONCLUSION

The retail sector in India is witnessing a huge revamping exercise as traditional

markets make way for new formats such as departmental stores, hypermarkets,

supermarkets and specialty stores. Western-style malls have begun appearing in

metros and second-run cities alike introducing the Indian consumer to a shopping

experience like never before. The sector is at an inflexion point where the growth of

organised retailing and growth in the consumption by the Indian population will take a

higher growth trajectory.

The retail boom is contributing to the growth of multiplexes in the various cities of India.

Most of the multiplexes in India are anchor tenants in the large format malls making a

favorite destination for the youngsters as well as the families. Multiplexes have

captured the market as complete family entertainment centers. Multiplexes have

emerged as the major growth driver of organised retailing. Multiplexes are considered

as one of the anchor tenants of the mall as they help to increase the footfalls by about

30-40%. It is the multiplexes which are the most potential attractor of crowd in mall

compared to other things present in the mall.

Thus this factor needs to be taken care of by the retailers and the developers in order

to generate traffic, revenues and getting mutually benefitted from each other.


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CHAPTER 8

LIMITATIONS & SUGGESTIONS


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LIMITATIONS

A research study is never perfect. There is always some scope of improvement in the

study in the future. Thus it becomes important to critically evaluate the results and the

whole study. The present study has certain limitations that need to be taken into account

when considering the study and its contributions:

a) There a number of a factor which affects consumers perception about mall and

multiplex and is not possible to take all of them into account. Thus this study is limited

to variable under consideration.

b) The research is based on the responses given by the respondents which may or maynot be biased.

c) The results shown are relative in nature and are not absolute. In other words it is the

perception of an average customer.

d) The taste, nature and preferences of customers differ from region to region. Thus this

study is strictly focused on Delhi & NCR region.


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SUGGESTIONS

After completing the research, I came to know multiplexes and malls mutually benefit

each other. This has to be kept in mind by the developers, multiplex owners and the

retailers. They cannot survive in isolation. Some awareness has come but still there is a

lot more that needs to be done which can actually benefit all of them. Some of the

suggestions are:

a) Cross Promotions should be done by the retailers and multiplex owners.

b) Generally retailers do not help in the promotional events going on in the malls. But I

would suggest that they should be coordination and retailers should actively

participate in conducting promotional events which can mutually benefit both of them.

c) The mall developers should continuously evaluate their tenant mix and make it as

optimum as possible.


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BIBLIOGRAPHY

1. Bishnoi,V and Rawat S (2009) A study of consumer shopping motives regarding

organized food and grocery stores, Indian Retail Review ,Volume 3,Issue 1, January-

June 2009, page 13-21

2. Images F&R Research Report (2009), Mall trends in India, Key trends &

Statistics, Images Retail, November 2009, Page 10-23

3. Manda D (2009) The Indian Experience of Cinepolis , Images Retail, November

2009, Page 52-54

4. www.thegreatindiaretailstory.com

5. www.google.com

6. www.pvrcinemas.com

7. www.bigcinemas.con

8. www.jammultiplex.com

9. www.dtcinemas.com

10.www.wavecinemas.com

11. . www.retailangle.com

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