If you really want to see retail in its purest form, observe any parent trying to introduce their children to reading. There is so much innovation involved in trying to sell the book to the child. Whether it’s in the animated storytelling or the visual aids, the parent will constantly iterate his/her methods to showcase the value proposition of reading. Mainstream consumer retail functions largely the same way.
With the Indian market spoiled for choice by brands and services, customer acquisition is no easy feat. Besides having a solid product offering, retailers must be able to design their retail experience keeping in mind the evolving tastes of the customer. Retailers in India have leveraged technology to come up with several innovative ways to nudge customers towards their product, changing the retail landscape continually. Here are some of the most significant Indian retail trends of the decade, with predictions for the years to come.
Standardised Products to Lifestyle Products (2011): While a lot of online retail started with the easier categories such as electronics, books and the likes, the first wave of lifestyle products started becoming big with the likes of apparel, accessories, jewellery etc. being sold online. Some of the big names including Myntra, Jabong, Yebhi, etc. started becoming big around this time. Today, a lot of the growth of the e-commerce marketplaces is contributed to fashion, lifestyle, furniture etc. Products, while of course, the standardised products still continue their big share on the revenue.
Marketplaces to Vertical brands (2012): A lot of private online-only or online-first brands came into existence around this time. Warby Parker, Bonobos, Dollar Shave Club etc. in the USA, and closer home in India, Urban Ladder, Bluestone, Zivame, Zovi, Yepme etc. all started selling around this time creating distinct brand recalls. While marketplaces still control the bulk of transactions online, some of these vertical brands have established a clear viable business for themselves. For e.g. Dollar Shave Club’s sale for a billion dollars has been one of the first success stories for the online-first vertical brands space. Today many vertical brands use the power of the digital horizontals to reach out to a wider customer base.
Search Marketing to 360-degree Marketing (2013): Google used to control pretty much all of the companies’ marketing budgets till 2012. Once Facebook started monetising their newsfeed, they also became a big force to reckon with. While Google has won back much of the share thanks to many categories including furniture now becoming search focused, a 360-degree strategy involving social, retargeting, mass media etc. is the preferred strategy now for most brands. If you see the horizontals such as Flipkart, Amazon or the verticals such as Urban Ladder, Myntra, etc. – most of them are multiple mediums including localised ones (such as radio, outdoor) as well as digital and national ones.
One-week delivery to Same-day delivery (2014): Around April 2014 is when Flipkart officially launched their same-day delivery. Though they were always known for their fast delivery for most products, configuring an entire supply chain to delivery the same day would have been quite an effort. Amazon launched Prime delivery in India sometime around 2016, but today, the norm has become same day or next day delivery without any extra charge. Supply chains have been configured end-to-end to be able to deliver these promises consistently at high volumes.
Desktop shopping to Mobile shopping (2015): 2015 was the year that companies started building dedicated mobile shopping experiences for customers. While some of them went overboard in giving discounts specifically to drive mobile installs, and stopping desktop sites, there were enough startups who were building integrated kickass experiences. We launched the Urban Ladder mobile app in 2015 early but had a bunch of other specialty apps such as Living Spaces, Urban Storage as early as 2014. Today, more than 35 per cent of our revenues come from our catalog app (and another ~12 per cent from mobile web) without offering any specific incentive for customers, and users are buying large products such as sofas, dining tables, and beds on our mobile app! This percentage number is higher for some other companies dealing with smaller ticket size/ smaller sized products.
Personalised Recommendations to AI Recommendations (2016): Recommended and related products have been showcased on websites forever. These products are usually based on your browsing behaviour and the products that you typically add to cart. As all online companies get more user data, we are able to personalise your experience far beyond just the products you see. We are able to utilise data in the background, and build more intelligence around the kind of products you like based on other patterns (demographic, geographic, inflow channel, time-based etc.) and showcase products to even the first-time customers. An increasing amount of data, raw processing power, infinite storage and ability to test the outcomes of any permutations thrown to the user has become a self-fulfilling prophecy to get the system to become more intelligent.
Offline-Online to Online-first Omnichannel (2017): Offline companies opening their website has been a thing forever. But now, we are seeing online companies go headlong into opening offline retail stores. The difference however between the two approaches is evident in the usage of data, online intelligence and ground-up thinking that some of us are able to do to open our retail stores. For example, our revenue per sq.ft. in our physical store that we launched in July has hit 5x of typical other furniture stores because of our intelligent use of technology to aid selling and better store staff training with data. Lenskart is seeing great traction for their offline stores and have surpassed most other offline-first eyewear retailers. If some of the concepts that Amazon has shown in the USA are to go by, the future of offline retail is actually going to be defined by online companies.
Human Logistics/ Delivery to Robots/ Drones (2018/19?): While some of these are in the nascency, Amazon’s drone video from a couple of years back seems to have funnelled a lot of promise in getting your next mobile phone order from the air. Regulatory changes look imminent to clear the air for this next wave. Alibaba’s smart warehouse system powered by robots has also been in the news for a while. The overall movement away from humans and into systems and robots is debated with a lot of passion obviously. Retail and logistics have traditionally been people-heavy industries and innovations like these on the backend show a lot of promise and are outstanding for fast customer deliveries.
Store/Web Interfaces to AR/VR Interfaces (2020 & beyond?): Today, VR and AR are still seen as intimidating and gimmicky. But a ton of advances in both technologies in the last 2-3 years, and mainstream companies like Facebook (with Oculus and a massive reduction in price) and Apple (with ARKit) are getting these technologies out to the masses. The day is not far away when the size of a VR device will be small enough to fit within the contact lens in your eyes (provided heating issues can be solved) and you will be able to merge the real and virtual worlds. You will be able to browse infinite digitally created shops worldwide sitting in your home and be able to buy and product with hand gestures and voice control. It may sound right out of a Tom Cruise movie today, but rest assured, as the devices become more mature, and user experiences become well thought-out, these experiences will become a reality to change the face of retail.