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The Young Guns of Retail: Surging ahead with guts and gumption

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Retail is such a dynamic and disruptive industry, that a good CEO needs to exhibit traits of intensity, impatience and an eagerness to move forward to stay on top of the retail game. We met a talented team of young CEOs who share a compelling purpose and vision for the industry. As the next generation of retail leaders, will they succeed in challenging global competitors and building lasting brands that excel?
We decided to pose a few questions, four to be precise. Most of the young CEOs provided detailed answers which offered us unique insights of the retail industry such as changing technologies and consumers, Government initiatives and regulatory policies, and innovative or disruptive technologies which were the imminent need of the hour. A few others, however, chose to be men of few words, yet captured their thoughts crisply and powerfully. Either way, the answers were insightful.
While there were some commonalities in their answers, each CEO had a diff erent point of view. What is interesting is that instead of three, we collated five differences – i) global competition, ii) the evolution of Omnichannel/e-commerce, iii) technology, iv) changing consumer expectations, and v) Government initiatives.
Global Competition:
According to Co-CEOs, FabAlley, Tanvi Malik & Shivani Poddar, “India has become an increasingly attractive destination for American and European brands in the last few years. We have seen the emergence of global behemoths such as H&M, Gap, Zara, Forever 21 and Muji with Uniqlo and IKEA waiting in the wings. The urban Indian consumer is spoilt for options now, as compared to a decade ago when only 2-3 global brands were available.”
CEO, Ikon Retail Pvt Ltd, Rahul Bhalla feels that heavy online discounts are further giving foreign brands an impetus.
The Evolution of Omnichannel/ E-commerce:
A decade ago, shopping was as simple as going to your nearest retail outlet and ticking things off your list from a limited choice of brands. Today, you don’t even need to step out thanks to the convenience that Omnichannel and e-commerce offers.
MD & Chief Design Curator, Baggit, Nina Lekhi says, “The emergence of e-commerce and everything going live at a single click is what keeps the industry fast-paced. Making it convenient for the customers by offering and delivering products with ease at their doorstep and with an easy return policy, is a new way to view Indian retail.”
While consumers have embraced the concept, some brick-and-mortar retailers are facing tough times. CEO, Just Herbs, Arush Chopra has a positive outlook. He says, “Retail is suffering at the hands of online, however, it is far from being dead. While we are increasingly shopping online, lots of us still prefer a brick-and-mortar experience. This has spawned ‘Omnichannel’ retail which itself is an evolving concept. Lots of brands are experimenting with this concept and I foresee interesting times ahead as this pans out.”
CEO, Skechers South Asia Pvt Ltd, Rahul Vira attributes the development of online retail platforms to the country’s changing economic scenario. He explains, “With the growth of the country, consumers have more disposable income to spend on fashion and lifestyle commodities. The evolution in technology at multiple levels has brought about a wave of change in the functioning of the industry. The Omnichannel approach provides a seamless shopping experience for consumers. Additionally, the e-commerce market has gained momentum and has developed an alternate shopping environment.”
Remember the days when it took months to get a landline? Today, competitively priced smartphones and data packs have brought consumers closer to technology. Chief Operating Officer, Travel Food Service Pvt Ltd, Gaurav Dewan says, “Technology has played a vital role in getting shopping right on the mobile and therefore generated various innovative business models.”
Competing in a world without boundaries, the consumer also wants technology to be embedded in their experiences. Tanvi Malik and Shivani Poddar add,” Big Data Mining Consumers’ shopping experience is getting more personalized with the emergence of big data analytics aadopted by the retailers. Both digital and traditional retailers are able to track their customers’ digital footprints with every new transaction or interaction at every linked retail touch-point – web, mobile, app, social media, and even in-store. This is allowing retailers to analyse and derive insights to provide better customer experience, run need-based marketing campaigns and improve product assortment efficiency.”
Changing Consumer Expectations:
The rise in Omnichannel and e-commerce can be mainly attributed to changing consumer behaviour and attitudes. They have more disposable incomes which has increased their spending power.
“This is one of the biggest differences that the industry has witnessed over a period of time and has created a domino effect in the industry”, says Director, Café Delhi Heights, Vikrant Batra.
He continues, “Today, consumers are more aware of the trends around the globe and are more accepting towards innovations offered to them.”
Dewan feels that “Consumer awareness and education has also grown the CRM or Customer Experience Enhancement dramatically.”
There is a bigger middle-class customer base and demographic focus shift from Tier 1/2 to Tier 3/4 cities. The aspirations of consumers for expensive and mid-premium brands is rising strongly. There is also a growing preference for global brands. In such demanding situations, how do brick-and-mortar cope?
Focus on VM and Merchandising:
According to CMD, V-Mart Retail Ltd, Lalit Agarwal, “ I feel a decade ago the variance between Indian retail and Middle East retail was much much bigger than what it’s now. India is growing. Absolute count of billionaires and millionaires are increasing and along with it the size of SEC A, B and C is increasing. This pattern is getting its due credit in my opinion.”
Adding further, Agarwal, says, “Increased range and width of merchandising almost at an international median level besides a sharp increase in specialty retail stores which once again reflects the maturing taste of the Indian upper and lower-upper strata consumer. In the value retail space, I feel I can take more risks now and deploy more capital than a decade ago when I introduced the concept of value retail in India. Overall I am more and more bullish on India and I really admire the way my country is coming up in the international arena.”
Government Initiatives:
According to Tanvi Malik & Shivani Poddar, “Foreign Direct Investment – with FDI restrictions loosened up on single and multi-brand retail, India has become an increasingly attractive destination for American and European brands in the last few years.”
Director, Ellemora, Shanky Kumar adds, “It is necessary to appreciate the initiatives taken by the Government. Since the Government has allowed 100 per cent FDI in online retail of goods and services through automatic route this has helped gaining clarity on the existing business of e-commerce companies in India.”
With opportunities come challenges. Almost every retail head voiced the same concerns.
Wafer-thin Margins Compounded by Unsustainable Discounting by E-commerce Players:
The onslaught of the online channels have impacted everyone in some way or the other. Online platforms have also blurred the lines between promotions, schemes and naked discounts.
Vice Chairperson, Nalli Group of Companies, Lavanya Nalli adds, “Capital dumping and unsustainable discounting by e-commerce players affects business.”
The sentiment is echoed by Founder & CEO, VAJOR, Nathasha AR Kumar, who offers a solution, “Discounting is a real challenge, retailers really have to change the discount driven shopping culture. Deep understanding of consumer and creating niche products can help tackle this issue.”
International Brands with Deep Pockets:
According to President/Co-Founder, Ayesha Fashion, Jacqueline Kapur, “The Indian fashion retail market is divided into two sectors, ethnic wear and western wear. I believe Indian high-street fashion brands face their biggest challenge from international brands. An Indian home-grown brand does not have the financial power to pay the rents, the salaries and the marketing costs as a big International brand can afford. The only way the Indian brand can survive is to be more ‘glocal’, more oriented towards the specific Indian customer.”
Lack of Qualified Skilled Talent:
The new workforce comprises mostly of millennials and the younger generation. They come with a different mindset and work ethos. This is where the retail industry faces a challenge; there is a difficulty retaining talent at junior levels and lack of qualified talent at mid-levels. There is a shortage of skilled staff especially in the premium and luxury retail space.
Batra adds, “Although the Indian retail is evolving with time, yet we still face some major setbacks, marring the growth of the industry. High rentals and high wages are the two most initial and common problems faced by entrepreneurs. With very little support from the Government, the laws around opening a restaurant are also a challenge. There are so many licenses and protocols that one must go through. It is extremely time-consuming which makes it difficult especially to setup a business.”
Availability of Quality Retail Space:
With the growing retail industry, the availability of real estate is becoming a concern.
Founding Director, Credo Brands Marketing Pvt Ltd, Kamal Khushlani believes that, “Rentals are higher than the economic value of that selling space.”
Nathasha AR Kumar says, “Lack of quality space along with high rentals impacts the break-even for brands.”
The Indian retail industry has a flourishing future. The organized segment is expected to double in size by 2020. With a promising GDP growth for the country, the per capita disposable income will also increase, giving retail industry a great push. Government initiatives to attract investment and increase consumptions shall also play a vital role in the retail growth.
The future is going to be customer-focussed with an inventive technological edge and this is what will drive growth for retailers.
Bhalla says, “The future will put customers and their needs at its core. The companies that can get that strategy right will still be standing in 10-12 years’ time.”
Shanky Kumar adds, “The Indian retail landscape would be the world’s fastest growing market due to the result of the robust investments coming up in the sector. Various reports have suggested a high growth in the Indian e-commerce market. It’s estimated that the market would reach up to US $12 billion by 2020. India’s e-commerce market is supposed to reach US $220 billion in terms of gross merchandise value with a customer base of 530 million by 2025. This has become a very lucrative period of various investors to invest in the retail segment which would give them high gains in the near future.”
Innovation and Agility:
According to CEO, Celio Future Fashion Pvt Ltd, Satyen P Momaya, “With high growth comes volatility and the organisation’s agility to respond to change.”
Batra believes, “Big ideas make big business. Start-ups are the biggest game changers in the industry today. Initially people used to associate people aged between 20 to 30 years to a start-up model, but now we even have people aged 40 and above who are successfully running their start-ups. The foreign funding too has a lot to do with encouraging start-ups and this has also been a game changer.”
Disruptive Tech:
Emerging technologies like Artificial Intelligence have the power to increase efficiencies within the organisation as well as better customer experiences. Consumers are already being exposed to disruptive tech in other categories and will soon expect it in their retail experiences. Retailers, therefore, need to start making investments that will give them an edge over their competitors.
Dewan says, “Technology is definitely a game changer. It can change the way customers consume or access your product and services. It can wipe out your business model and at the same time help you create new business models. The times we are living in are seemingly the most exciting of times.”
Increased Buying Power of the Middle Class:
The growing disposable incomes of the middle class are elevating their expectations. They are becoming discerning in their choices. Momaya believes that, “By 2025, the young generation will lead the consumption story.”
Keeping in mind the influx of foreign brands that are entering the country and a growing preference for them, Jacqueline Kapur, hopes that, “We will not have lost all local flavours and have some brands to stand up against the multi-national giants. The malls in India already have a very similar brand mix to any mall in Europe, Hong Kong or the US. The same brands, the same products are omnipresent. I sincerely hope, that there will be Indian brands, and not only ethnic wear brands, which will make the Indian retail market more colourful and interesting.”
Brands that are able to marry the online and offline experience seamlessly are definitely noteworthy.
“This is a tough thing to do and a lot of companies especially in the furniture and home furnishings space are doing this. I think the future will be Omnichannel. Brick-and- mortar stores will be basically outposts to drive trial and the transactions will move increasingly to the online space. This is already happening and I am expecting this trend to strengthen further,”says Chopra.
“Retailers will be much more customer-oriented, and we will see 360-degree integrated platform across online, offline, mobile and social touchpoints”, adds Nalli.
Managing Director, Kaunis Marketing Services Private Limited, Ajay Ghooli says, “The mix between online and brick-and-mortar will change, consumers will keep using offline platform for experience, while online will be for replenishment.”
As Director, Turtle Limited, Shitanshu Jhunjhunwalla succinctly summarises it in one word, retail in 2025 will be “Dynamic!”
Every CEO has his own rulebook. True, this could change in light of such a dynamic scenario, but there are certain tenets which are unshakeable no matter the situation. CEO, Ciclo Cafe, Ashish Thadani summarises it aptly, “Not just in retail, but qualities that any CEO should possess are a mix of a few C’s i.e. Caring, Compassionate, Credible and Competent. If either of these qualities are missing, you can’t lead successfully. A few qualities are evergreen. So, this scenario would never change, not even in 2025. Ultimately we are all dealing with humans and not machines.”
Batra has an interesting point of view. “Earlier long term used to be a period of 10 years but now it has come down to three years. The reason for this change is the ever-changing market and customer behaviour. Every day, there is innovation happening all around the globe. Hence it is not possible to determine the changes in 2025. The old short term has become the new long term.”
Dewan says, “Since it is a fast-paced industry, where consumer preferences change with a blink of eye, the foremost quality of a CEO should be ‘Agility’- constant learning, strategizing, guiding teams for execution and then monitoring and if required course correction is imperative in retail, and specially for an exciting category like food retail.”
Lekhi also feels that, “Every retail CEO must have an International exposure to retail to make your brand raise its bar and come on the scale of international standards.”
Customer Focussed:
Jacqueline Kapur says, “A CEO in the retail field needs to be able to understand the customer.”
Nathasha AR Kumar says, “Everyone who is working in retail needs to understand the changing behaviour pattern of the consumer and the gen-next. The shift everyone talks about is happening currently in the retail scenario.”
Data Driven:
Shanky Kumar says, “In a highly volatile market like India, it is essential for any entrepreneur to constantly be updated regarding the market trends. We should be research-oriented, curious and constantly experiment with the product to fi nd success.”
Nalli stringently follows data-driven research.
While Jacqueline Kapur says, “Moving away from neighbourhood shops to mega malls and on-line shopping has made it more difficult to interact with the customer and understand the needs of the clients. Digital information about the customer will become more and more important not only for the e-commerce business, but also for the off -line sector.”
Batra adds, “Every CEO must have a good eye for understanding data. Data collected forms the backbone of an organization and helps the company grow and achieve its standard goals. To collate, analyse and implement the data around us is crucial task that one has to master.”
Succession Planning:
CEO, Kaya Limited, Rajiv Nair has an interesting list of tenets. “Visualise and adaptto changes faster. Be digitally forward. Focus on execution rigor. Find next gen leaders within the organisation. Be ready for disruption. Th ink young and dynamic.”
Momaya adds, “Learn and unlearn, the relentless focus on building winning teams, as they would be the catalyst to growth, being consumer obsessed and externally focused.”
Managing Director, Da Milano, Sahil Malik adds, “It is imperative to evaluate the dynamics of the industry, embrace the diversity of the market you’re in and posess the ability to bring together a unique and varied team of talent who share a compelling purpose and vision. Th ese wouldn’t change in the coming years but only advance gradually.”
Bottom Up Approach:
Vira says, “I believe the CEO should set aspirational examples for everyone in the team. He should be a risk taker to bring about a change. His strategies should be objective driven and aggressive in nature. Entrepreneurship should be an inherit strength; Understanding your firm and all the operations at each and every level of the company structure is very important. Starting right from the production of the product till the last leg. Trusting your team is the basic foundation of the firm.”
Dewan adds,” The front-line guys are our heroes, they are the ones who are constantly on ground running the show, therefore the second most important quality that any CEO must have is empathy to drive the bottom of the pyramid in a manner that returns the favour by serving the passengers well.”

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