A good retail experience includes a great product, a great service and fun. This can vary depending on what kind of retailer you are. According to the India Online Retail Market Forecast & Opportunities 2016 report, India will witness a number of changes in shopping trends in the coming years. The nation is predicted to become the third largest in terms of internet users by 2018. Given this and the rising middle class, with growing disposable income and lack of time to spend in physical stores, the etail market is expected to grow vastly.
More brick-and-mortar retailers are stepping up their online game and increasing the percentage of their sales that come from such channels. Web-only retailers have been growing at a remarkable rate too. For conversions and larger transaction sizes, retailers need to leverage trends that are currently transforming and influencing the retail landscape.
Millennials play a large role in online sales
Retailers need to be aware of the unique preferences of millennials and create shopping experiences that satisfy their need for trustworthy information and personalisation of products and practices. This generation is already a powerful force in the market, and its spending power will grow. They are highly motivated by peer recommendations on social media. They trust themselves and their peers more than they trust brands. To reach millennials, retailers need to invest in mobile, as this TG is the largest group of smartphone owners and they are impatient by nature. Retail in 2016 will continue to be driven by the preferences of baby boomers and even more by millennials. This year, we can expect stores to overhaul their strategies to bridge this gap between offline and digital channels.
Make Big Data bigger
Retailers will use data to get to know their customers and provide customised shopping experiences. One example is the ability to analyse footfalls. Big Data can now reveal precisely when specific customer groups will shop and exactly what they want. Retailers can then make targeted adjustments to staffing, product placement, marketing displays and prices. Detailed analysis of individual SKU performance metrics can also allow retailers to adjust merchandise assortments and promotions, improving inventory throughout to avoid costly markdowns.
Embracing augmented reality
Imagine being transported to your favourite store while staying in the comfort of your own home. Or trying on jewellery without it physically being there. Or being able to see exactly how a new sofa would look within your living room. Since the launch of Microsoft’s Holographic, augmented reality has gained immense popularity in a short span of time. From virtual fitting rooms to interactive window displays, merchants are continuously finding ways to use augmented reality to draw attention, engage customers and improve their shopping experiences. IKEA launched its augmented reality catalogue to enable shoppers to visualise how certain pieces of furniture could look inside their homes. Not only that, but the app also measures the size of the products against the surrounding room and fixtures to offer a true-to-life size where possible. We will see huge increase in AR-centric efforts in 2016.
Personalised shopping experiences —such as word-of-mouth content that can be filtered from people with similar attributes — are more likely to motivate consumers than unfiltered user-generated content. Consumers are already tuned into the kind of shopping experiences they want. They are finding the information they need to make purchase decisions, even if that means they are not getting it from the retailers themselves. They shop on their own terms via the devices they choose at the times they want from different locations. That doesn’t make retailers less relevant; it actually has the power to make them more relevant if they can provide those experiences seamlessly and give customers the information they want.
Becoming a trusted partner in a consumer’s buying journey requires a large amount of change. However, after the doomsayers of the early e-commerce movement, retailers should be uplifted; competing in this new environment of constantly connected, regularly informed consumers won’t be easy, but it can be rewarding.
We believe there will be a clear drive to review and improve retail standards and the customer journey.
Ad-dendum By Yatish Mehrotra
The author is head— branded retail, Tata Teleservices