The coronavirus pandemic was a once-in-a-lifetime test of business continuity planning for retail businesses across the globe. Even when things have stabilized to an extent and economies are gradually opening up, the industry is being confronted by a string of questions, the hardest of which are
– What’s next?
– What has changed in consumer behavior and what impact will it have on businesses? What’s the New Normal going to be?
– What changes are likely to persist and which of them are reversible?
“Throughout this time, we have just ate and slept on the implications of the pandemic on our businesses, how to deal with it, about cash conservation, cost reduction, various survival strategies, etc. I think that the need of the hour is to prepare for what is next,” said Vishak Kumar, CEO Madura Fashion and Lifestyle (Aditya Birla Fashion & Retail), while moderating a session at India’s first Phygital Retail Convention.
Fortunately for the Retail Industry, consumption is an such an integral aspect of modern lives that even a pandemic of the catastrophic proportions of COVID-19 couldn’t abate it. It did, however, create a big dent in that consumer behavior and consumption patterns evolved suddenly and radically.
“The consumer has been subject to a massive metamorphosis. But the resilience that we have seen in our consumers is very heartening for all of us in the retail industry. What businesses need to do now is track the change in consumer expectations as well emerging trends,” said Abhishek Ganguly, MD, Puma India & Head South Asia.
The pandemic has compelled the entire businesses ecosystem to be unit economics centric. While businesses too were forced to focus on strategic cost management and roll out cost improvement initiatives, the lockdown made consumers analyse their financial baseline and pinpoint bad spending habits.
“This makes me believe that consumption behaviour is going to change for ever. In the New Normal, spends well be more thrifty as consumer focus will be more on saving. Also, with the consumer being at home the entire week, weekends will graduate to a new dimension and will offer immense opportunities to lifestyle retailers,” said Arun Narayan, VP and Chief Retail, Marketing and Merchandising Officer, Tanishq.
In the wake of the pandemic, e-commerce has gained traction, and this presents immense opportunity for brick and mortar, according to Arun Narayan.
“Today, brick-and-mortar is equipped with all the technology that e-commerce has. Utilizing the digital stack available, we can now afford to give consumers the convenience of buying from home. We have seen how conveniently technologies like endless isles, video calling, and payment links could be used to our advantage. If we could just implement the whole intelligence and recommendation engine in brick and mortar retail, I believe we could give a new dimension to physical retail,” he added.
The pandemic has also been a tech-opener for both organizations and consumers alike. Today, technology is evolving faster than it had ever before.
Rapid advancements in technology has given enough opportunity to all retail channels to recover from the pandemic triggered stupor.
“It all depends on how smart and agile organizations are. Organizations need things differently so that they can smartly pivot their businesses. Perhaps this entire adversity has taught us to make a tunnel through the wall as opposed to saying there is a wall,” said Arun Narayan.
As a silver lining, the COVID-19 pandemic has brought a conclusion to the perennial online vs offline debate. It is hereby clear that the future of retail will be dictated by convergence of all channels and emergence of a truly new multichannel retail.
“Going ahead, businesses will have to deliver to the customer wherever and whenever the customer would like. So a combination of both physical and online will have to coexist. Also, growth and profit will stall to be the kernels of organizational focus in the near future,” said Anchit Nayar, CEO-Retail, Nykaa.