50% of the population today is in the working range that drives growth in retail.
Franchise India organized the NCR’s biggest Retail thought leadership event "The Future of Noida Retail" at Wave City Centre, Noida, on 25th January 2019. The event witnessed top retailer brands and potential investors joining in and discussing the future of the retail industry in 2019.
Here are some of the views, shared by Neeraj Singh, Senior Director of KPMG India, in the event.
The topic of retail is the most touched topic. But before getting into the Future of retail, let’s just paint the future according to what's happening in the western world.
One of the most important things about retail is the constant change that needs to be understood. Whatever happens, it's the business of serving human needs. Some of the examples like Amazon buying the PillPack or Toys R Us closing about 800 stores in the US last year affect so many people. These are the kind of information that we get on a daily basis, showing us the change in dynamics happening in the industry.
50% of the population today is in the working range that drives growth in retail. The overall population forecast is to rise from 52% in 2017 to 78% by 2022, which is basically for the middle class. So, the middle class is going to grow from 52 to 78% in 2-3 years time-frame.
Retail contributes to about 10% of the overall GDP but the retail is growing faster than the GDP rate. 95% of the sales are still happening through the stores and not really online. So, the online penetration is still low, making it a long way for the retail industry to grow. It’s believed that 2019 could be a remarkable year for the industry, seeing the advent of more mobile commerce.
Key trends of Future Retail are:
Nowadays, the kind of shopping options available for people are changing their behavior, making them get what they want immediately. This behavior is fueling mobile commerce activities as it is much easier to find the mobile and get the purchases done. It is not only about mobile commerce, but there are so many convenient ways to make purchases and that is one of the focal trends that are going to happen from 2019 onwards.
Augmented Reality is already working in a full blown way in some of the cases in India. For example: In the IKEA store, a person can set up his/her living room and decide the furniture. On the other hand, Facebook is looking at converting news feed into Augmented Reality solutions from where a person can go on an experience that they want to convert. These are the things that are coming up in a big way as far as the Augmented Reality is concerned.
Automation of retail Experience
This trend can be explained with an example of Agri-space as farm to food stories have become so prevalent at today's age. People need to know from where their food is being sourced, what was the value chain or where did it come from. And in this process, the transparency is actually helping retailers to build their brands. Nowadays, brands are not only about the quality of the product, but they are getting much deeper.
Personalization means touching people's emotions, it also means touching people's genetics. For example: Expedia has programmes that can see which holiday advertisement a person is looking at. Based on this, the company recommends the consumers about the holidays that they will be interested in. The genetics personalization is also coming based on which you can propose people what product they can buy.
Brand and shopping streaming
In today's era, people are constantly streaming different videos about various brands and products, finding a way to utilize them. For example: Loreal constantly streams the way you can do your make-up. It's about combing your live streaming, m-commerce, personalization to kind of help somebody to choose the right product. That's where the industry is getting into. So, the consumers are actually leveraging technology to the fullest.