Why the Retail Giant ‘Future Group’ Failed?

Why the Retail Giant ‘Future Group’ Failed?

Dr M.Rahman, Senior academician in Business Administration

Unable to bear huge debt and liabilities and compete in the dynamic retailing business environment, India’s retailing giant Future group led by Kishore Biyani (known as “The King of the Indian Retail”) owning flagship store ‘Big Bazaar’ has accepted a proposal of acquisition from Mukesh Ambani led business conglomerate Reliance Industries Ltd. Big Bazaar stores were considered to be ‘the Indian version of America’s Walmart stores’. However the Future group failed to manage its momentum due to certain reasons and this article made an attempt to understand the reasons behind its failure.


Failure of Future group and the proposed acquisition

In the past, the world saw many business giants like My Space (in social media), Nokia (in mobile phone), Kodak (in Camera), Jet Airlines (in Indian aviation sector) and many others unable to stand in the cut-throat competition and ended up either being acquired by other business giant or shut down. In this list, the latest addition is India’s retailing giant Future group led by Kishore Biyani commonly known as “The King of the Indian Retail”. Unable to bear huge debt and liabilities and compete in the dynamic retailing business environment, Future group’s retailing business that owns flagship store ‘Big Bazaar’ has accepted a proposal of acquisition from from Mukesh Ambani led business conglomerate Reliance Industries Ltd through its subsidiary Reliance Retail Ventures for an amount Rs 24,713 crores.

However, the Future Group asset acquisition is subject to regulatory and other customary approvals, which may take around few months to complete. At present, this deal is going through legal proceedings filed by Amazon (a stakeholder in Future Retail) in Singapore International Arbitration Centre (SIAC) against the deal.

As a part of the proposed deal, Reliance Retail Ventures (RRVL) will take over more than Rs 19,000 crore of debt and liabilities owed by Future Group’s retail, wholesale, logistics and warehousing units until March 31, 2020. Future group owned renowned companies like Future Retail Ltd., Future Lifestyles Fashions Ltd., and Future Supply Chain Solutions Ltd. will be now owned and managed by RIL through its subsidiary. While Future Retail owns the flagship Big Bazaar alongwith many other popular stores (including HomeTown, Food Bazaar, FBB, Easyday, Nilgiris, FoodHall, Heritage Fresh and WHSmith), Future Lifestyle Fashions Ltd operates fashion discount chain Brand Factory, Central and Planet Sports.

While this acquisition (if completed successfully) will further strengthen RIL’s financial profile and competitive position and add about 1,700 large stores to RIL’s 11,806 stores in its retail segment and increase its organised retail revenue market share by around 5 per cent. (according to Fitch Ratings, a global research firm), it will kick out Kishore Biyani out of retailing business for many years. After this transaction, Future group will retain the manufacturing and distribution of FMCG goods and integrated fashion sourcing and manufacturing business and its insurance JVs with Generali and JVs with NTC Mills.

It’s irony that with this deal Kishore Biyani known as the finest brain in Indian retail sector and considered as “the King of Indian retail’ would have to remain out of any retailing venture for the next 15 years. Kishore Biyani is known for pioneering organized retailing in the country with the launch a chain of modern retailing formats like supermarkets and hypermarkets across the nation.


About Future Group

Future Group is a corporate group headquartered in Mumbai (India) in 1987 and founded by Kishore Biyani in 1987 as a garment manufacturing company that sold formal trousers under the brand name of ‘Pantaloon’. Over a period of time it diversified rapidly and the group is now known for having a significant prominence in Indian retail and fashion sectors with popular retail chains like Big Bazaar, Food Bazaar, Home Town, Brand Factory, Planet Sports, etc through its operating companies Future Retail Limited and Future Lifestyle Fashions Limited. In addition to retailing, the group has a notable presence in integrated foods and FMCG manufacturing sector, logistics, insurance, logistics & supply chain as well as apparel design and manufacturing sectors.

Kishore Biyani is known for launching India’s first hypermarket ‘Big Bazaar’ in the country around 20 years ago when organized retailing was at the introduction stage. It was scaled up rapidly to over 250 stores across 120 Indian cities over years. Biyani’s success with Big Bazaar under Future Retail had turned him into a revered figure in the Indian retail sector and a magnet for media attention. He was running the largest retailer in the country and was named as retailer of the year by the National Retail Federation, which at one earlier point had refused even to admit him.

Future group’s flagship comapny Future Retail operated 1,550 stores with its flagship brands Big Bazaar, FBB and Foodhall, Easyday, Heritage Fresh and WHSmith. Future Lifestyle Fashion operates 354 stores of Brand Factory, Central and Planet Sports. On any given day, over 2 millions visit future group stores and digital networks as claimed by Future group website (www.futuregroup.in). In addition to retailing, the group also has presence in FMCG, insurance, media, logistics & supply chain as well as apparel design and manufacturing. The group operations were performing ok with Future Retail clocking a total revenue of Rs 20185.37 cr and a net profit of Rs 732.81 cr in FY 2018-19. Also, Future Enterprises Ltd that holds largest shares in Future Retail and other group companies had a revenue Rs 5433 cr and a net net profit of Rs 133 cr in FY 2018-19 against a revenue of Rs 6065 cr and a net profit of Rs 175 cr in FY 2019-20.

However, when the group was earning profit in FY2019, what happened to “The King of The Indian Retail’ –  Kishore Biyani led Future group that compelled it to sell out its flagship retailing and logistics businesses to RIL in August, 2020. Let’s us try to understand the underlying factors/reasons.

Why Future Group Failed

Selling of its complete stake in Future Retail to Mukesh Ambani’s RIL is seen as the biggest setback to Koshore Biyani, known as one of the best minds in retail business in India. But how did he come to this point? What were the reasons behind the sell out? Lets us understand ‘why Future group failed’?

Key Reasons – Why Future Group Failed?
Huge debt
Aggressive expansion, Unrelated Diversification
Inability to leverage online retailing
Corona-virus pandemic

CLICK HERE for Details of ‘Reasons behind the Failure of Future Group

Text Mining and its Applications

Text Mining and its Applications

text mining

For businesses, the large amount of data generated every day represents both an opportunity and a challenge. On the one side, data helps companies get smart insights on people’s opinions about a product or service. Think about all the potential ideas that you could get from analyzing emails, product reviews, social media posts, customer feedback, support tickets, etc.

Data can be internal source (interactions through chats, emails, surveys, spreadsheets, databases, etc) or external (information from social media, review sites, news outlets, and any other websites).  On the other side, there’s the dilemma of how to process all this data. And that’s where text mining plays a major role.

If you need to examine tons of reviews in ”The Times of India’ or in a ‘review site” to understand what customers are praising or criticizing about your brand. A text mining algorithm can help you identify :

  • the most popular topics that arise in customer comments, and
  • the way that people feel about them: are the comments positive, negative or neutral?
  • You can also find out the main keywords mentioned by customers regarding a given topic.

So, what is Text mining?

Text mining is the process of transforming unstructured text data into meaningful and actionable information. It utilizes different AI technologies to automatically process data and generate valuable insights, enabling companies to make data-driven decisions. It involves extracting information from different written resources – like websites, books, emails, reviews, and articles. High-quality information is typically obtained by devising patterns and trends by means such as statistical pattern learning.

Methods for Text Mining
It includes basic as well as advanced methods as mentioned below:

  • Collocation
  • Concordance
  • Text Classification
  • Text Extraction

Basic Methods of Text Mining

Word frequency, Collocation and Concordance are the three basic methods of text mining.

Word frequency can be used to identify the most recurrent terms or concepts in a set of data.

Finding out the most mentioned words in unstructured text can be particularly useful when analyzing customer reviews, social media conversations or customer feedback.

For example: Expensive, overpricing, overcharging, high pricing

Collocation refers to a sequence of words that commonly appear near each other.

The most common types of collocations are bigrams (a pair of words that are likely to go together, like get started, save time or decision making) and trigrams (a combination of three words, like within walking distance or keep in touch).

Identifying collocations — and counting them as one single word — improves the granularity of the text, allows a better understanding of its semantic structure and, in the end, leads to more accurate text mining results.

Concordance is used to recognize the particular context or instance in which a word or set of words appears. We all know that the human language can be ambiguous: the same word can be used in many different contexts. Analyzing the concordance of a word can help understand its exact meaning based on context. For example – It is expensive for me but save much of my time in office work.

Advanced Methods of Text Mining

Text classification and Text extraction are the two advanced methods of text mining as mentioned below.

Text Classification is the process of assigning categories (tags) to unstructured text data. This essential task of Natural Language Processing (NLP) makes it easy to organize and structure complex text, turning it into meaningful data. With text classification, businesses can analyze all sorts of information, from emails to support tickets, and obtain valuable insights in a fast and cost-effective way.

Some of the most popular tasks of text classification –

  • Topic analysis – helps you understand the main themes or subjects of a text, and is one of the main ways of organizing text data.
  • Sentiment analysis – helps in analyzing the emotions that underlie any given text. It helps you understand the opinion and feelings in a text, and classify them as positive, negative or neutral.
  • Language detection – allows you to classify a text based on its language. One of its most useful applications is automatically routing support tickets to the right geographically located team. Automating this task is quite simple and helps teams save valuable time.
  • Intent detection –helps you to recognize the intentions or the purpose behind a text automatically. This can be particularly useful when analyzing customer conversations.

For example, you could sift through different outbound sales email responses and identify the prospects which are interested in your product from the ones that are not.

Text Extraction is an advanced text analysis technique that extracts specific pieces of data from a text, like keywords, entity names, addresses, emails, etc.

By using text extraction, companies can avoid all the hassle of sorting through their data manually to pull out key information.

The key tasks of text extraction –

  • Keyword Extraction: keywords are the most relevant terms within a text and can be used to summarize its content. Utilizing a keyword extractor allows you to index data to be searched, summarize the content of a text or create tag clouds, among other things.
  • Named Entity Recognition: allows you to identify and extract the names of companies, organizations or persons from a text.

Feature Extraction: helps identify specific characteristics of a product or service in a set of data. For example, if you are analyzing product descriptions, you could easily extract features like color, brand, model etc.

Click to see ‘Applications of Text Mining’

Starting Google ads campaign

Starting a Google Ads campaign – Step by Step Guide

Starting a Google Ads campaign –Step by Step Guide

Dr M. Rahman, Associate Professor, Galgotias University

Google Ads (formerly Google AdWords) launched in 2000  is an online advertising platform developed by Google, where advertisers bid to display brief advertisements, service offerings, product listings, or videos to web users. Google Ads is Alphabet Inc’s main source of revenue, contributing US$134.8 billion in 2019.

It can place ads both in the results of search engines like Google Search (the Google Search Network) and on websites, mobile apps, and videos (the Google Display Network). 

This article explains the structure of Google Ads campaign and the steps in developing an advertising campaign on Google Ads platform for improving business performance.

Structure of Google Ads Campaign

Google Ads is organized into three layers:

  • Account  The account is associated with a unique email address, password, and billing information.
  • Campaign – The campaigns have their own budget and settings that determine where your ads appear.

     For example, A university offering undergraduate and postgraduate programs need to create different ad campaigns for admissions for each of these programs.

  • Ad groups – The ad groups contain a set of similar ads and keywords. A campaign can have multiple ad groups.
    The undergraduate program admission campaign can have different ad groups for BBA, BA(Eco), B.Com.
    The ads and keywords for BBA ad campaign for admissions will be different from those of BA(Eco), B.Com ad campaign.

Starting a campaign in Google Ads

Step 1. Create a Google Ads A/C and login..
Step 2. Select ad campaign goal
Step 3. Select ad campaign type
Step 4. Target your audiences (customers)
Step 5. Setting bids and budgets
Step 6. Creating ad groups
Step 7. Create ads
Step 8. Measure and Optimise the campaign performance

Step1. Create a Google Ads A/C and login    

Visit the Google Ads website https://ads.google.com/intl/en_IN/home/. To create Google Ads account, one needs an email address and website for your business.

Step 2. Select ad campaign goal

Advertising goal may be – Brand awareness, Website traffic, Generating Leads, Sales, App promotion etc. as shown below. These are options available to you in setting your goal. Select one goal that is best for you.

For example – A management college offering MBA program would like to attract more and more target customers to visit it’s website. So, in this example, the goal can be attracting ‘Website traffic‘.

Step 2. Select ad campaign campaign type

After setting the advertising goal, select the best campaign type from the following options from Google Ads.

The most commonly used campaign types include:
i) Search campaign — Ads can appear throughout websites on the Google Search Network. • Your keywords are linked to the words or phrases that someone uses to search on Google, then relevant text ads are shown on Search Engine Result Pages (SERPs).

 ii) Display campaign — Ads can appear throughout the Display Network. This campaign type works by matching your ads to websites and other placements, such as YouTube and mobile apps, with content related to your targeting.

iii) Video campaign – Advertise on YouTube with Video campaigns on Google Ads. You can choose ad formats that serve with an option to skip the ad after five seconds or as a six second buffer between videos.

iv) Shopping campaign If you want to show products from your eCommerce store in Google Shopping, then you’ll need to setup the Google Merchant Center.

Step 3. Target your audiences/customers

Targeting will show your ads to the right customer groups and is a key part of a successful ad campaign. 

There are different options of targeting in Google ads. You can pick up one targeting option or more than one in combination.
i) Audience targeting

Audience targeting helps you reach people based on who they are, their interests and habits, what they’re actively researching, or how they’ve interacted with your business. So, you can target on the basis of age, gender, marital status, education etc.

ii) Location targeting
With location targeting, you can target the geographic areas in which you’d like your ads to appear. you will be presented with the choice to target:

  • People in or who show interest in your targeted area
  • People in or regularly in your targeted area
  • People searching for your targeted area

iii) Language targeting

Language targeting helps ensure that your ads will appear on websites that are written in the language of the customers you’d like to reach.

  iv) Device targeting
You can reach your customers while they’re on the move by showing your ads when people are searching or visiting websites on their devices.

For example mobile phones with full browsers, such as iPhones and Android devices.

Step 4. Setting bids and budgets

 Once you have decided which networks you want to display your ads on and who you want to show them to, there are two things you’ need to focus on:

Your budget: Your daily budget is the amount that you set for each campaign to indicate how much, on average, you’re willing to spend per day.

Your bidding strategy: Depending on which networks your campaign is targeting, and your advertising goals, you can determine which strategy is best for you.

The bid strategies that you can choose from: 

Cost-per-click (CPC) bidding: Use if you want to drive customers to your website.

Cost-per-mile impression (CPM) bidding: Use if you want to make sure that customers see your message.

Cost-per-acquisition (CPA) bidding: Use if you want to maximize conversions on your website.

Step 5. Creating ad groups and keywords

A campaign can have multiple ad groups.  Each ad group contains a set of ads and keywords.
Example, BBA, BA(Eco), and B.Com can be different ad groups within undergraduate admission campaign.
For keywords relevant to your product or business, you should use ‘Google Keyword Planner’
Try to use appropriate keyword match types such as broad match, broad match modifier, phrase match, exact match and negative match.
Example – For BBA ad group, you can consider the following keywords:
“BBA Admission 2021”
BBA admission
[Best BBA institute]

Step 6. Create ads

After you have set up your ad group and keywords, you need to develop an ad for it. You need to write each element of an ad. For a search ad, the various elements are headlines, Display URL, Description and Ad extension.

An example of search ad for BBA admission is given below.

Step 7. Measure and Optimise the campaign performance

After the start of the campaign, you need to measure its performance with the help of multiple reports generated by Google Ads like Search term report, Auction insights report etc.