Has the internet changed the nature of the way shopping occurs in stores these days? more
Facebook Places, Foursquare and just about every Social Networking seems to be focusing on location these days. But the problem is they all rely on some sort of check-in, whether it be manual check-in by the user or using the latest GPS/Geo-fencing based check-in.
Just a mere decade ago the retail landscape in India comprised entirely of mom-and-pop stores. This was the case in all sectors of retail: grocery, soft goods, home & home furnishings, white goods etc.
Since then the retail sector in India has witnessed tremendous growth. The key factors responsible for their retail boom have been the change in consumer profile and demographics, an increase in the number of international brands available in the Indian market, an increase in urbanization, high credit availability, an improvement in the infrastructure, an increase in investments in technology and real estate groups building a world class shopping environment for the consumers. Resulting in the past couple of years retail being amongst the fastest growing sectors in the country. In fact India ranks #1, ahead of Russia, in terms of emerging markets potential in retail, according to India Realty News.
Among the major economies in the Asia-Pacific region, India’s private domestic consumption as share of GDP was the highest according to an analysis by the McKinsey Global Institute at 57% in 2008. What is even more remarkable is that Personal Consumption Spend has grown to 35% of GDP – which is considered to be the best measurement of retail spend by the consumer. And as a percentage of GDP this is even rivaling consumer spend in developed economies such as the USA!
In 2005, TSMG (Tata Strategic Management Group) predicted that in the next 10 years, the overall retail market in India was likely to grow at a CAGR of 5.5%. The organized retail market was expected to grow much faster at a CAGR of 21.8%. Based on TSMG’s projections, the top 5 organized retail categories by 2015 would be food, grocery & general merchandise, apparel, durables, food service and home improvement.
However, a recent 2009 article by TSMG they felt that in order for India’s Retail Sector to continue its meteoric growth it was time that the retailers revamp their strategies and lead with a Customer-Insight led business model. This will call for true customer segmentation based on identification of customer needs and real shopping behavioral patterns.
I agree and feel that in order for the budding Chain-Store Retail Industry in India to blossom they need to understand what is really driving their target consumer in order to deliver truly exceptional customer service that rivals that of major domestic retailer!
What’s your view – we would love to hear.
