Trade Revival: India’s economic and digital boom will transform the retail industry
India’s economy is the fastest-growing major economy in the world. In its annual Economic Survey, the Ministry of Finance forecast GDP growth of between 6.75–7.5 per cent in 2017–18, compared with projected growth of 7.1 per cent for 2016–17 and actual growth of 7.6 per cent in 2015–16.
The country’s sustained period of prosperity is also good for the digital transformation of the economy that is currently under way.
That said, India’s digital journey is not an entirely seamless one. Like India itself, a vast country of extremes and differences, the corporate sector is not a homogenous entity that moves as one.
Some businesses are moving faster than others with regards to digital uptake and some that have commenced that journey have barely touched the tip of the iceberg. Certain large companies that one might expect to be well down the digitisation path have barely given it any thought, and so their competitors are seizing the personalised first-mover advantage with gusto.
Yet while Indian businesses are at varying stages of digital awareness, the hallmarks of the digital marketplace are the same for all players.
Consumers are today demanding a heightened customer experience, more personalised services, rapid response times, relevant product and service offerings, and a choice of engagement channels. Similarly, employees, particularly the digital natives, are attracted to ‘smart’ workplaces that reflect changing attitudes to work, foster an inclusive and collaborative culture, and enable technology-agnostic work practices.
Internally and externally, brands can no longer rely on unfettered loyalty – the onus is now on them to understand their customers better. Smart marketers understand the challenge: brands have to be in sync with changing consumer behaviours and mores, while also fulfilling the demands of consumers that are less forgiving.
When consultants Bain & Company studied the shopping habits of 80,000 Indian households last year, they found that one-third of the shopper base churns every year, and that level is expected to grow.
“For brands hoping to truly beneﬁt from India’s economy, success rests on understanding actual shopper behaviour and what winners do differently,” Bain said in its paper, Winning with India’s shoppers.
“As consumer goods spending in India reaches an inﬂexion point, marketers… will need to understand the important nuances of shopper behaviour at the point of sale.”
New levels of understanding
Marketers have always wanted to understand their customers and with powerful tools to capture and analyse huge amounts of data in real time now at their disposal, they can know them like never before. Moreover, they can personalise customer interactions across platforms (online and offline) based on those insights.
While digital take-up is still fragmented, fresh interest is coming from quarters which have previously resisted,or been indifferent to technology.
It’s no longer just banking, financial services or insurance companies investing in digital capabilities – many of these institutions are preparing to step up their digital status as the benefits become clear. A number of banks, among the earliest adopters of digitisation, are now developing advanced multi-channel capabilities to better service customers.
The consumer packaged goods sector is showing interest in digital and even traditional ‘bricks and mortar’ retailers that have resisted the e-commerce business model are today starting to digitize, having realized, that all commerce is eCommerce.
Consumers driving the trend
Shoppers, not retailers, are setting the rules of engagement as they become more adept at using online and offline channels to secure the best deals available. For example, a shopper may visit an Adidas store to see a shoe, check the price and try it on, only to then purchase the same product online for a better price. Alternatively, they may do their research online, read the reviews, see what social media is saying about that particular shoe and then walk into the retail store to buy it.
The time is ripe for companies that have yet to embark on the digital journey to take their first step. The economy is buoyant and consumers are seeking out the brands that best meet their expectations and modal preferences.
Adobe is proud to have partnered with some of India’s most innovative businesses on this journey, including HDFC Bank, MakeMyTrip, SpiceJet and IndiGo airlines, Malayala Manorama, as well as a number of state and national government agencies.