India is witnessing a transformation in consumer behaviour and preferences today. The fast growing CDIT retail market, currently valued at Rs. 1,50,000 crore, is also evolving in terms of fast-changing consumer landscape. The CDIT industry, which is currently growing at the rate of 15–17 per cent, has seen great innovation in technology, rising disposable income and rapid growth of new retail formats. Consumers today have ample options in terms of new technology products, global shopping experience and variety of retail formats to choose from.
Some of key consumer trends which have evolved recently in this sector include:
Well-informed and smart buyer
Consumers today are more informed and are doing more research before making a purchase. By doing so, they are also open to getting influenced at various stages from consideration to the actual purchase. They are seeking more details and trying out new things to buy the latest technology. Apart from actively searching for promotions, they are constantly on the lookout for newer stores to buy items from and better brand options to choose from until they get the best deal. They are also opting for premium products in this sector. In a way, new age consumers have become more discerning before finally deciding to pay premium in terms of the desired benefit and value the product offers.
Prominent brands in the CDIT sector have also responded well to the consumer in terms of increased frequency of flagship launches and introduction of new technology. For instance, LED panel TVs have replaced LCD panel TVs much faster than LCDs replacing the conventional CRTs.
Increasing role of digitisation in changing consumer preferences
As consumers are shifting more and more towards the use of the digital medium to research products, they are also taking their new-found knowledge back to offline retail locations to make the transaction. This trend is highly prevalent in CDIT sector.
Increasingly consumers are searching online for product information, price comparisons, and online reviews. The Internet too plays a significant role here, as it is considered to be the most convenient source for concerned product or service-related research and which also saves precious time.
Though the incidences of actual online purchase in this segment are quite low, the digital medium is poised to play a major role in changing consumer preferences in this sector.
Increasing affinity to buy from exclusive brand outlets (EBOs)
Prominent multinational and Indian brands in this sector are setting up EBOs at strategic locations. Consumers’ preference for EBOs is increasing due to overall better shopping experience, better customer engagement due to trained staff and better availability of latest technology products. Consumers opting to buy from exclusive stores have higher product feature awareness and their overall purchase is well planned.
Smart deals and in-store promotions
Retail and shopper marketing is an emerging marketing category in India, which uses touch-point marketing and in-store marketing activities to influence the entire shopper decision and bring more value to the purchaser. Furthermore, brands too are spending more on multi-brand outlets (MBOs) to influence the mindset of the consumers.
Smart deals such as bundling of 2 to 3 related products rather than discounts on single products are lapped up by the consumer. Today, brands believe that smart promotions are more likely to influence the consumer mindset. Latest consumer researches in this sector also show that at least one in five consumers buy more than they actually plan to, as result of getting influenced by in-store smart deals and promotions.
These trends are likely to continue in near future, which will further boost the sector demand in terms of engaging the new age Indian consumer.
About the author: Joginder Chhabra, Head, Market Intelligence and Consumer Insights, LG Electronics India