The retail ecosystem in India is at the forefront of change. The sector is experiencing exponential growth, expanding not just in major cities and metros in the country, but also in Tier II and III cities and towns. The last decade has witnessed inordinate market growth in the online retail space due to the increased usage of smartphones and internet penetration.
India is Asia’s third largest retail market and the world’s fourth largest after the United States, China, and Japan. Being the world’s largest millennial population, India is one of the fastest-growing major economies globally. Food and grocery industry accounts to a major share of the retail market in India followed by clothing, consumer durable and IT segments.
E-commerce is seeing the biggest growth trajectory in recent years because of increased usage of smartphones, internet penetration in Tier II and Tier III cities and increased online shopping. 2019 saw the highest disruption in technology and was the year of transition for retailers who have begun their digital journey. 2020 comes with a great promise for the industry. Below are the emerging retail trends in India to watch out for.
1. Frictionless customer experience will become basic hygiene
Today’s market is flooded by infinite choices: products, channels with information anywhere anytime. Digital is redefining service expectations from consumers, last mile delivery is the key differentiator. Just like with food delivery, even retail & grocery segments are working on 2 to four-hour delivery and probably lesser than that with drones. Delivery is expanding to other segments of retail like pharma. Pick-up points are the new trend seen with bigger retailers to help reach consumers faster.
2. Businesses will become agile and responsive, continuously innovate and evolve
Big or small, success and growth today is defined based on how retailers spot their inefficiencies, have the right skill or expertise to identify and comprehend the changes required, innovate and adopt faster with retail trends in the market and even government regulations such as GST. With new technologies like robotic process automation (RPA), beacons, big data, artificial intelligence (AL) and machine learning (ML), businesses need to comprehend the changes and understand how to implement them. For example, surveillance cameras are not just used for measuring footfall today, but data captured is also used to understand the shopper’s emotion, needs and vision. The Internet of Things (IoT) signals to identify and anticipate the channels customers use, replenish a shelf etc.
3. Serving customers in the channels of their choice
Given the growing complexity of the retail world today, adding new components or technologies brings in a whole lot of challenges. Such integration challenges are costing a lot of time and money, thus decreasing their ability to thrive in competitive markets. Going forward, businesses cannot operate and work in silos. They connect and collaborate with smart ERP platforms. With such connected environments, there will be a need to capture feedback at all the touch-points, embrace them, understand the customisation required for the current business landscape, ensure seamless data flow with systems talking to each other and most importantly, understanding the level of support from vendors or partners for 100% business continuity.
4. Information-loaded business to insight-driven business
With the rise of e-commerce & mobile-commerce, Retailers have found new ways to reach customers. But to keep them growing in a competitive market, it is important for businesses to turn data and analytics for enhanced decision making. Going forward with the use of AI and ML, retailers will benefit on huge cost-saving, a faster resolution to problems, identify new revenue channels, increase automated process and drive profits.
5. Invest and measure Return on Experience (ROX)
In today’s world, it is not just technology that is leading the change; it is consumers and their behaviour. The traditional way of measuring ROI is just not enough. Retailers need to identify the path to purchase, the factors that influence their decisions and thus measure the purchase experience of customers. Say, rather than replenishing the fast-moving products in the ROI based approach, with ROX based approach Retailers display stock and sell the fast-moving products in the front to improve experience and drive loyalty. Going forward, evolve from “Buy, Stock, Sell” to “Sell, Buy, Supply”. With continuous iteration, gather data, model it, understand it, act and implement the changes, as well as to measure and improve, again and again.