Digitization is transforming global business practices across all sectors and Retail is no exception. The retail industry is at the helm of transformative changes that will redefine customer shopping experiences and the overall operation of the industry.
Over the past decade, the presence of high-net-worth individuals (HNIs) has expanded from just 10-15 cities to over 60 cities. Recognizing the significant potential in these remote areas, retailers are now redesigning their retail marketing strategies to seize these opportunities.
The introduction of 5G spectrum and high-speed internet is revolutionizing how products are bought and sold. Consequently, customer experience is becoming the top priority, influencing the design of websites and apps to place the customer at the forefront.
In a research conducted by CyberMedia Research, it was found that consumers in Tier 2 and beyond spend close to two hours and twenty-five minutes shopping online, and spend approximately 16 percent of their income on online shopping.
In this post, we will discuss the reasons for the renewed interest of giants like Tata and Reliance in the retail sector, both e-commerce and brick-and-mortar, and what it means for Gen Zers entering the job market.
The Surge of Value Commerce and How it Will Impact Retail Marketing Jobs
Trent-owned Zudio is capturing significant attention in the value commerce segment. According to the Mint, Zudio added 203 stores in 2023, bringing its total to 545 stores across 164 cities in India, including the ones co-located with Star Super Market. This aggressive expansion has allowed Trent to access micro markets effectively.
The combined portfolio of Trent’s retail formats — Westside, Zara, and Star Supermarket — accounts for a consolidated revenue of ₹12,375 crores. This success is drawing the attention of major national retailers such as Reliance Retail’s Yousta, ABFRL’s Style-Up, and Shoppers Stop’s InTune.
Blurring Lines Between E-Commerce and Brick-and-Mortar
Consumers seamlessly transition between online and physical stores, with Gen Z often visiting physical stores to experience products firsthand before ordering online for better deals.
Retail Marketers recognize this behavior and aim to provide a consistent shopping experience across multiple channels. The retail sector is shifting towards a customer-centric approach, requiring adaptation to technological advancements and strategic alignment.
Omnichannel and phygital are the two buzzwords in the retail circles, essentially both omnichannel and phygital aim to integrate the physical and digital shopping elements but they both differ in the ways the task is achieved.
Omnichannel retailing is about creating a seamless customer experience across all shopping channels, including online stores, physical stores, mobile apps, and social media platforms. This includes synchronized inventory, uniform branding, and consistent customer service across all channels.
Phygital stores, on the other hand, blend physical and digital elements like interactive kiosks, digital screens, virtual try-on mirrors, and augmented reality features to enhance the in-store experience.
Both omnichannel and phygital stores aim at allowing retail marketers to offer their customers a personalized experience.
Impact of Augmented Reality and Virtual Reality in Retail
First things first, is AR and VR just a passing buzzword or is it taking on the retail world? As discussed earlier, both the retail sector and e-commerce are striving to achieve enhanced customer experience which can be achieved largely by embracing what technology has to offer.
AR apps allow customers to see how furniture will look in their home, cosmetic companies use AR to show how a particular shade of lipstick will look on a customer even without applying it.
Virtual showrooms are captivating customers, making their experiences enjoyable and allowing retailers to engage with the customers for an immersive experience. How AR and VR contribute to the business.
AR and VR provide detailed product information and visualizations, helping customers make informed purchasing decisions. Customers can assess features and quality more accurately by experiencing products in a realistic, virtual environment.
Personalized shopping experiences enhance customer satisfaction and build long-lasting relationships with customers. On the business front, it reduces the likelihood of returns and lowers costs associated with returns for the retailers.
Gen Y and Z contribute to almost 63 percent of the world’s population. This generation loves to indulge in technology-driven experiences, thus Brands that adopt AR and VR could position themselves as leaders in adopting cutting-edge technologies.
With Technology comes data-driven insights on consumer behavior and the latest trends which enable better inventory management and targeted marketing strategies.
Growing Share of E-Commerce and Performance Marketing Budgets
As per the reports published in www.https://www.investindia.gov.in/ the Indian e-commerce industry is growing at a rapid pace. And if the In the FY 2022-23, the Government e-marketplace (GeM) registered its highest-ever Gross Merchandise Value of $2011 Bn.
As per TRAI’s Indian Telecom Services Indicators the Internet penetration in India as of Sept 2023, is over 954 Mn and almost 100 percent pincodes have been covered. The tier 2 and tier 3 cities comprise over 60 percent of the transactions and contribute to three out of every 5 orders.
