By Monica Chada
BBC correspondent in Bombay
When Indian film director Ram Gopal Verma made the Hindi movie Bhoot - Ghost - he introduced two concepts that were totally unheard of in the Indian film industry.
The Bhoot dolls are part of Bollywood's new merchandising drive
One was a Hindi film without the trademark song and dance sequences. The other was merchandising.
His company got a toy manufacturing firm to make and sell the doll featured in the movie at shops.
Both turned out to be hits with the Indian public.
Marketing head Himanshu Chakravarty of the Westside chain of stores, where Bhoot dolls are being sold, said they vare hoping to cash in on the love for Bollywood.
"Most of India, especially the northern and the western part of the country, is very obsessed with Bollywood.Whatever the Bollywood stars do, the movies, it has a lot of influence not only in terms of entertainment but also their fashion and lifestyle.
"As such there is a natural scope for products which, in many ways, give them access to what the Bollywood stars look like or dress like."
He also said the store has merchandise on sale that has been "inspired" by the film, such as Hallowe'en masks, pen holders and bags. These too, he says, have been doing very well.
Film merchandise has always been available in Indian markets but most of it is pirated. In fact, the total Indian retail market is estimated to be worth $180m (£110m) of which the organised retail sector is a mere two percent.
Rajat Barjatya of Rajshri Films says the industry is learning
Now Rajshri Films, the producer of as-yet unreleased Hindi film Main Prem Ki Deewani Hoon - I Am Crazy After Love - has entered in a joint venture with retail chain Pantaloon to manufacture and sell clothes and memorabilia featured in the movie.
Rajshri Films director Rajat Barjatya said it learned its lesson
when it lost money to black marketeers on sale of merchandise from their previous blockbuster film, Hum Aapke Hain Kaun - Who Am I of Yours.
This time around, he said, they have taken care to ensure their latest film's merchandise is legally available.
"Someone told me the purple saree in Hum Aapke Hain Kaun sold in excess of a million pieces. That is obviously something that has been eaten up by the pirates.
"We felt that if the movie and if any attire in particular were to become as popular as the purple saree, we should be able to cash in on that.
Mr Barjatya also said film merchandise may not be as big in India as it is in the west, but considering the cult status Indian film actors enjoy, it will not be long before this turns out to be a big revenue earner for producers.
Stars Hrithik Roshan and Kareena Kapoor have launched film merchandise
Pantaloon managing director, Kishore Bheyani, said merchandise was profitable for retailers as well.
"We believe the film-goers are the shoppers. They are teenagers, they are the aspirational class who come to our stores and we are looking at good clothes being sold at a great price," he said.
"A normal movie which doesn't do well also is watched by minimum 30 million people in India. So the chances of film apparel being sold in large volumes are quite high."
The Bollywood merchandise will have to win over discerning shopers
Indians may be generous in their love for Bollywood movies and film stars but do not seem so big-hearted when it comes to spending their money on film products.
Teenager Animesh Misra said he will only buy Bollywood superstar Hrithik Roshan's jeans if they suit his personal style. Alka Sangai is a housewife who said she would buy outfits worn by actresses in movies they were wearable and affordable.
Shashi Joshi is a working mother who said she would only buy things that had a positive influence on her children. The Bhoot doll, she said, is a strict no-no.
The past year has been one of the worst for Bollywood. There have been only two standout movies while others have come and gone without making any impression at the box office. Film makers have suffered heavy losses.
But if sale of movie merchandise provides them with an additional source of revenue, then they may finally have something to smile about.