Just after recovering from the devastating blows of this year’s pandemic, India’s retail industry is once again facing uncertain times with restrictions being localized in many places to curb coronavirus infections even as industry players are becoming âphygitalâ to respond to customers.
With the omnichannel approach gaining traction, technology will remain a key enabler for the retail industry and in 2022 the focus will likely be on building an agile and sustainable supply chain that delivers the convenience of “phygital” shopping.
Concepts like buying videos may become more mainstream, and businesses will continue to adopt advanced analytics to improve sales and gain granular, actionable insights into buyer behavior.
In addition, with the rise of social media and influencer marketing to the forefront, creativity and the push for content, especially with regional languages, will gain in importance.
Metro Cash & Carry India Managing Director and CEO Arvind Mediratta said COVID has dramatically changed consumer behavior and shopping habits.
He also pointed out that health and safety concerns have mainly led to consumer decisions that have led people to seek out essential products, especially those with health benefits.
âCustomers now decide ‘when to shop’, ‘where to buy’ and ‘how to buy’, whether online, offline or a mixture of the two. They are looking for a seamless omnichannel experience. Therefore, phygital has become an intrinsic part of the shopping experience for customers, and this integration between offline and online retail is likely to grow, âMediratta told PTI.
According to him, retailers must imbibe an integration strategy to improve the value proposition and the customer experience.
Deloitte India partner Rajat Wahi said COVID has set a “new standard” for retailers and forever changed business dynamics for them.
However, the retail industry, which is now leveraging technology to interact with and reach its end customers, is also grappling with some implications.
“We are seeing a major erosion of brand loyalty in everyday categories as new products and brands are launched by both private label retailers and ‘home’ entrepreneurs, leading to rapid commoditization in all categories, “he said.
According to Wahi, health and sustainability will continue to be the focus for the immediate future.
Wahi noted that fragmentation and consolidation is expected to continue, with larger retailers getting bigger and smaller ones being bought out or shut down due to various disruptions.
With the emergence of the Omicron variant and localized restrictions put in place by various states, there are growing concerns that the recovery of the retail sector will be affected in the near term, analysts say.
Recent data from the Retailers Association of India (RAI) showed retail sales in November 2021 were up 9% from pre-pandemic levels in November 2019 and 16% from November 2020.
“Business is improving and we hope it continues. However, there are still concerns about Omicron and the third wave, leading to a feeling of cautious optimism,” said RAI CEO Kumar Rajagopalan.
AVP and ICRA sector chief Sakshi Suneja said the spread of the Omicron variant poses a major downside risk on the road to recovery.
Harsha Razdan, Partner and Head of Consumer Markets and Internet Business at KPMG, said investments in digital technologies, platforms and customer-centric technologies such as chatbots and dedicated websites have increased significantly.
âI think we are gradually moving away from ‘retail’ to ‘retail’, a phenomenon where consumers are center stage and are responsible for generating demand and shaping the value chain. Going forward, companies will continue to adopt advanced analytical technologies to improve sales and gain granular actionable insights into buyer behavior, âsaid Razdan.
National Leader of EY India – Consumer Products and Retail Angshuman Bhattacharya said that with increasing consumption, growth of e-commerce and rapid commerce, the industry is expected to return to growth levels of before COVID.
The pandemic has made retailers resilient and efficient, and many have embarked on a door-to-door model. Despite the looming threats of another wave, the industry is now better prepared to deal with business continuity risks, he said.
âDespite another pandemic wave, the industry is poised for multidimensional growth over the next 5-10 years as new multi-channel omnichannel models would create a unique retail model in India, ahead of the curve as the most developed countries, and integrating the country’s fragmented retail network, âhe said.
Commenting on 2021, CEO of Future Retail, the country’s leading retailer, Sadashiv Nayak said it would be summed up as one of pace, closeness and persistence. He had deployed omnichannel presence and inventory in 285 Big Bazaar and 85 independent fbb stores.
According to Bhattacharya, with a recovery in the economy and in consumer confidence, discretionary segments such as jewelry, durable goods and personal care have already returned to pre-COVID levels.
Now, retailers are adopting multi-channel models.
“The integration of modern commerce and e-commerce, spurred by the investments of large retail companies in e-commerce enterprises, and vice versa lead to an integrated business model and a changing role of modern commerce in one. hub for the integration of consumers and retailers into a catchment, âhe added.
Retail companies like Ikea have expanded their presence in retail both offline and online.
Nivedeeta Moirang, Communications Director of Ikea India Country, the economy is showing signs of a gradual recovery and over the past two years the house has taken center stage.
âThere has been an increase in interest in home furnishings among the many people as a basic needâ¦ Affordability, coupled with good design and functionality will remain key growth engines to shape growth. of the home furnishings industry, âshe said.
According to her, with more and more online shopping, the digital footprint of retailers has accelerated and many, including Ikea, have found new ways to meet the customer. “This hybrid buying behavior is here to stay and companies must continue to innovate to respond to customers when, where and how they want.”
During the year, the Rs 24,500 crore deal between the Future Group and the retail division of Reliance Industries could not be reached.
Reliance Retail Ventures Ltd (RRVL), the retail arm of Reliance Industries, had – for the second time – extended the deadline to secure its Rs 24,713 crore deal with Future Group until March 31, 2022, as it still awaiting regulatory and judicial authorizations. Future Group is also engaged in a bitter legal dispute with Amazon, which opposes the deal.
(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)