New Delhi: Indian shoppers, along with consumer goods companies, are taking the multi-channel approach after the pandemic shifted customer habits, prompting a shift in retailer offerings, consultancy Deloitte India said in a report released Monday.
“The future of the retail industry will be defined by a multi-channel approach where online and offline channels will not only compete with each other, but also support each other. The way forward for retail will be a mix of stores physical and online retail platforms, both of which are likely to continue to grow in markets like India. Brands and retailers are recognizing the transition and their strategies are being refocused to reflect this shift,” the report says –ReWriting the Rules of New Retail–.
The pandemic has caused permanent changes in consumer behavior. Although once the closures are lifted, shoppers have returned to stores, yet they are much more discerning when it comes to accessing the products of their choice. This means they are ready to move to different platforms and buy across multiple channels.
As a result, retailers, especially offline, have had to adapt to the “new normal”, developing alternative ways to interact with and reach their end customers, creating new business models, including the direct reach to the consumer, rapidly improving their online presence. while preserving their offline stores and footprint, he added.
Consumers increasingly expect to be able to buy any item, when and how they want, in real time, he added. This has deep ramifications for brands.
“This instant cross-channel shopping is being tackled by retailers not only in stores, but also upstream throughout the supply chain, which is also undergoing massive omnichannel transformation,” Deloitte said in its report.
Retailers can take the opportunity to redesign their store layouts where shoppers can opt for convenient pickups and returns, he added.
India’s retail sector is valued at $883 billion, having tripled over the past decade. Currently, it employs 8% of the total workforce at 35 million; by 2030, it should create 25 million new jobs.
Deloitte said the key trends that will drive the consumer products and retail industry over the next few years include product premiumization, platform consolidation, emergence of hyper-targeted niche brands, shift consumers to smaller and localized store formats, the exit of weaker players, the emergence of direct-to-consumer and alternative business models as well as consumer orientation towards convenience and sustainability.
E-commerce has become the preferred shopping channel during the pandemic as consumers refrain from going out and want contactless delivery. Rajat Wahi, Partner, Deloitte India, said while in the past it was expected that e-commerce could only capture 5% to 6% of overall retail, the number could rise to 15% by now. 2025. Wahi Said It could play out differently across categories, with apparel, electronics, accessories, and books having greater online prominence; online grocery shopping will still take time to grow, he said
Meanwhile, companies are also keeping tabs on emerging new shopping models, such as social commerce. Businesses, according to the report, are increasingly using this platform to sell goods to save on capital expenditure and operating costs, while reaching large audiences across the country.
Wahi pointed to continued consolidation in the retail and consumer sector, where larger companies will continue to invest in smaller niche players that offer differentiated products and are organically digital.
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