THE FUTURE OF RETAIL IN INDIA

The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Sai Prasanth C, MBA 2015-17, Vinod Gupta School of Management, IIT Kharagpur

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The organized retail, with its advent in India, has brought about tremendous changes in the consumer market. The organized retail provided its customers anonymity, leading to the freedom of choice, and superiority. In the decade following 2000, the Indian economy has witnessed the growing consumer income. This, eventually, lead to more aspirations and awareness of the choices in the market. This, profoundly, influenced the purchasing behavior of the families and lead them to the new formats of shopping. The organized retail empowered the consumers, women in particular, by providing the freedom of shopping. It has also empowered its employees through stringent training programs to hone their interpersonal skills. The organized retail, in India, has witnessed a plethora of innovations which duly changed the course of its progress. The Mix n Match aisle idea by the Shoppers stop in the apparels format addressed the customization needs of the customers and has
seen tremendous success. The Marketing strategies got dynamic owing to the impulse buying behavior of the consumers. But with the advent of the technology and penetration of internet in India, online retail has posed a serious threat to the future of the traditional “bricks & mortar” stores.

With this impending threat, the retail specialists contemplate the possible factors that will drive the future traditional retail. A few of the possible future drivers, as the specialists claim, are the experiential retailing, the customization, the dynamic product line and the digitization. The retailers need to understand the importance of the digitization and adapt the omni channel strategy. Integrating the channels by using the in store pick up of web
orders is bound to provide the ease of shopping to the customers. The experiential shopping is a definite customer-puller. The magic window of the shoppers stop and the OVS2.0,a fashion store in Milan, helps the customers to try on different apparels virtually and the idea has been embraced by the customer fraternity. The in-store locator and the interactive window help the retailers to send contextual text messages to the customers, enhancing
their shopping experience. These two innovative techniques will also help the retailers to collect and analyze the data regarding the shopping patterns of the customers and help design the store better. The online inventory system helps the retailers to update the prices of the products dynamically. The shoppers can also find the best prices and the availability of products.

Given the dynamic market, the key to conquer the market is the disruptive technologies. According to the “State of the Internet of Things” study by Accenture Interactive, nearly two thirds of the consumers will be owning connected homes and wearable technologies by 2018. The IOT improves the customer experience by providing the simplified and central solution to the customer problems. With the internet enabled smart tags adjusting the
prices of promotional items real time and synchronizing the prices of products across all the channels, there will be a definite improvement in store operations and reduction in costs of operation. The other possible disruption in the traditional retail is the products delivered to the customers, which is called the channel personalization. Audi & DHL have teamed up to deliver the customer purchase to the car trunks using the one time generated authentication code. The ease of retrieval of the purchase is a strong point to draw the customers to the store. In the market today, the customization of the products is the key to retain the customers. The high end customization could be achieved by the 3-D printing technology. The customization of the products can range from the high volume personalization to the individual personalization. This could also possibly drive the future and create the avenues for the traditional organized retail.

Eventually, all the tactics could bring the customers to the store but the in store experience determines the customer loyalty. Courteous staff equipped with up to date information of the product line, store ambiance, extensive loyalty programs and warranties & guarantees form the strategy to enrich the customer experience. Embracing and extending into the online space, the traditional retail stores adapting these strategies and disruptive technologies can continue to own the major sales share in the total retail sales.

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