Being a foodie, my breakfast preparation tends to be extremely elaborate. A lot of what I cook depends on what I feel like eating that morning. Most of these dishes have ingredients which would not feature on a monthly grocery list: penne pasta, sriracha sauce and black olives, for example. Now I could wake up in the morning, shop for the ingredients online and wait a couple of hours for delivery, or simply pick them up while I’m on my morning jog. But does this mean I’ll prefer to stand in long queues in the grocery shop all the time? I suppose not! This is precisely why multiple retail formats not only co-exist but are all growing as well. Each of them address a different need.
The vast and diverse nature of the Indian consumer provides ample variety of needs for retail stores to address. Mom & pop stores, departmental stores, e-commerce platforms, all target different needs of a variety of customers. With consumers becoming more and more comfortable with the variety of retail options, the market is booming. The Boston Consulting Group and Retailers Association of India published a report titled, ‘Retail 2020: Retrospect, Reinvent, Rewrite’, highlighting that India’s retail market is expected to nearly double to $1 trillion by 2020 from $600 billion in 2015, driven by income growth, urbanization and attitudinal shifts.
Indians are both ‘Show-rooming‘ (checking and researching for products offline but buying online; typically for categories like gadgets, apparel etc.) and ‘Web-rooming’ (Researching online but buying offline specially for categories like automobiles, furniture & homes). The next wave of commerce in India will be ‘Omni-channel’, ‘Destination-Less’ & ‘Curated’ by machines & humans.
Buying is NOT Shopping. Buying whether at the checkout counter of a physical store or within a site / app is just purchasing a product. Shopping, on the other hand entails the full spectrum, an experience which encompasses discovery, curation, price comparison, price negotiation and after sales service. Shopping in India is poised to evolve to be multi-channel, anytime/anywhere and personalized for each user. Companies should aim to not only keep customers happy but to stay relevant. To achieve this, both brick-and-mortar as well as online brands need to evolve at a pace faster than their customers’ preferences.
Omni-Channel commerce has already made a mark in India with eCommerce companies opening brick-and-mortar stores. Pepperfry, Zivame, FirstCry, Lenskart & even Flipkart have started offline stores to build credibility and provide greater reach. These stores not only offer experience zones for customers but act as both marketing and sales channels to save some online ad spend. On the other hand, traditional retailers like Reliance, Aditya Birla & Tata’s & have expanded into online stores as well.
Online business models provide a greater reach and variety. But they’re limited by the touchpoints they offer to the customer – the internet. With hybrid models, businesses have a great number of touchpoints, offering several advantages. Sales data from several touch points can be integrated for superior insights into consumer behavior and demand. Hybrid models also impress upon customers who’re both internet savvy and internet-dark. These models will lead to massive growth of private labels across categories. However, for Omni-channel to succeed one requires a new organizational blueprint, massive investment in IT systems and processes which ensure a consistent customer experience across channels.
By Destination-Less shopping I mean ‘serendipity led shopping’ that can happen on any destination (a movie theatre, a music/news app, an office location etc). You can start discovering and buying products on a music app, a news site or a fashion blog. For instance, imagine you are reading an article about fitness on your favorite news app, you not only discover similar articles (as the case is today) but you may also discover a fitness app like Run Keeper, a health band like Fitbit or Goqii or a Nike shoe & a gym membership. Or while watching a movie you might discover a new travel destination or some funky apparel for the next Saturday night out in town. Through a combination of technology and real world interface you can get additional information, experience as well as buy the product then itself. The lines between the point of inspiration and transaction will be blurred in the destination-less world.
Lastly, shopping today is becoming more of a baffling ordeal than ever, whether in an offline store aisle or on the online virtual shelf. The intended purpose of commerce was to bring ‘choice’ into the lives of consumers. Somewhere down the line, the idea of ‘choice’ morphed into options, varieties and platforms that are overwhelming to say the least. We have so many choices that decision-making has become harder than ever before. As a consumer bombarded by hundreds of choices, my attention span has greatly reduced.
Commerce companies have realized this overwhelming effect of excessive choice. Tesco has decided to scrap 30,000 of the 90,000 products from its shelves as well as introduce a trial in 50 stores to make it easier and quicker to shop for the ingredients for meals. Re-arranging shelves based on data about products frequently bought together will simplify and speed up the purchase process in retail stores. Placing basmati rice next to Indian sauces, and tinned tomatoes next to pasta are examples of this. A similar transformation is in the wings across categories specially electronics, mobile phones, fashion, furniture, home decor, and more.
Certain products are purchased by a particular type of customer. But that customer still remains bombarded by irrelevant product choices. An Artificial Intelligence-like personal assistant that will guide consumers through the maze of product options available can simplify the decision-making process. In the digital world this can happen at scale powered by social recommendations, curation and discovery. However, algorithms alone can’t do an emotional task, you will also need a human touch to make the experience of shopping engaging & rewarding.
With technology evolving along with the retail industry, the future looks brighter for the choice-ridden customer. Rather than feeling trapped on a crowded platform surrounded by salesmen hawking their wares, it will be about the product discovery adventure. The simple joy of the shopping experience will be back once more.
Disclaimer: This is a guest post. The statements, opinions and data contained in these publications are solely those of the individual authors and contributors and not of iamwire and the editor(s).Category Ecommerce