It is said that the change is only constant and more often than not inevitable for those who want to remain relevant. For the world of business this paraphrase has been more evident and tangibly felt in last couple of decades.
Changes don’t occur overnight, they keep brewing over a period of time and those who survive or must I say thrive are the ones who notice the undercurrent of such change much before they make an impact on the entire paradigm, for which businesses at times find themselves unprepared.
India’s retail industry has been witnessing such changes over past two decades. For US$ 800 billion plus category, a share of 3.5 percent might not have seemed a change that could possibly change things overnight, but for those who understand the potential of such changes would have witnessed the massive shift in consumer behaviour the industry has brought along in less than a decade. E-commerce industry from nearly 10 million users and about 3 billion in volume in the year 2010 has grown by about 1,000 percent to 100-110 million plus users and US$ 30-34 billion in volume in just about a decade.
All this seem just a tip of the iceberg in the view of this black swan event that we have witnessed in the form of unprecedented COVID-19 crisis. An industry that so far seemed to only have made an impact on categories such as consumer electronic, fashion, personal care and to some extent and readymade food is suddenly making massive in-roads to daily essentials and have touched upon almost all facets of retail significantly. The impending changes in consumer behaviour is sure to make this change even more severe for only offline retailers as already penetrated tier II & III towns/cities are adopting to electronic commerce given this catalyst otherwise a catastrophe for the mankind.
Am I hinting that the entire offline retail should go online, or am I seemingly predicting that the offline retail will cease to exist – the answer is a big NO. While the current scenario may dent offline retail business temporarily, they will bounce back as we find solution for the COVID-19 scenario which given the resilient history of mankind is bound to happen sooner. So what are the changes I am so eloquently trying to advocate?
Without complicating into this whole offline and online debate, the single and most fundamental change that I am suggesting to every retailer, is to adopt technology which is aligned with the changes in consumer behaviour. With adoption of technology – a business must plan to go Physital (physical + digital) – all offline retailers must have an online presence either through owned or through market-place channels, and as the industry evolves, mostly all online players would need to have extension in offline world.
So, how is it that an existing retailer could quickly adopt to this change, here are a few suggestions –
– Get yourself digital brand identity: If you are brand owner or even a retailer (however small), get your business a basic digital brand identity like website, email address and social media handles like Facebook, Instagram, YouTube etc. (choice of channel has to be totally based on what business segment one operates in)
– Create a digital catalogue: Build a catalogue of products on your website and in various electronics format including one that could be easily be shared through channels like WhatsApp etc. (again execution of this totally depends basis category and scale of business)
– Enable online ordering: Get your own e-commerce engine in place or list yourself on market place such Amazon, Flipkart, Nykaa, Zomato, Swiggy etc. (strategy for going with owned channel or through market place or both will totally depend on business type, scale etc.) – there are plenty of cost effective solutions available these days
– Build your customer database: Data is not just the oil, it has the power to change businesses fundamentally, weather you are a small retainer or a big retailer – knowing your customers, their likes/dislikes, their behaviour and almost everything you can know about themselves is essential – this is single most important technology led transformation all retailer must bring about. Those with lesser resource can do it with simple xls to start with, but then there are plenty of cloud based solutions that can help them to do this more cost effectively
– Create customer engagement program: Once you know customer, building affinity and in turn loyalty is one of the most important factor that could help you grow your franchise. Given that you are armed with your customer database and behavioural insights – engagement becomes an easy exercise, provided you follow discipline and rigour. Focus on the utility of the customer than that of yours, it will help you build a bond which will go beyond business. Earning you that customer for lifetime.
– Leverage your offline presence: I mean leverage the physital (physical + digital model) in longer run, give your customer the comfort of your offline association while offering them complete convenience enabled by technology to order and engage online
– Remain in beta mode: the ever-changing technology scenario necessitate you to keep an eye on what is happening now in the world of consumers. And, make changes to your business in compliance.