The Indian Retail Market is on the brink of a transformative leap, projected to exceed a staggering $2.2 trillion by 2030. This growth is largely fueled by traditional offline channels, which are expected to account for approximately 90% of all sales. However, the influence of online interactions on consumer purchases is significant and growing, highlighting the intricate dance between digital and physical retail spaces.
The Omnichannel Approach in Indian Retail
A recent report titled “Decoding Omnichannel: Strategies for D2C Brands” by Accel, Fireside Ventures, and Redseer Strategy Consultants, delves deep into the evolving consumer patterns. The study illustrates how India’s market dynamic is witnessing a shift towards omnichannel shopping experiences. Consumers are increasingly navigating through various channels at different stages of their buying journey, indicating a blend of modern digital habits with traditional shopping methods.
Success Stories from the Frontlines
Several consumer companies and startups have been at the forefront of leveraging these shifting behaviors to their advantage. For instance, brands like Mamaearth have not only had successful initial public offerings (IPOs) but also exemplified the potential of multi-channel strategies. Similarly, companies such as Cult.fit, Urban Company, Curefoods, Homelane, and Lenskart have demonstrated significant growth by adopting omnichannel frameworks.
Prashanth Prakash, a partner at Accel, emphasizes the uniquely Indian characteristic of this omnichannel blend, which marries the digital convenience with the tactile, trust-based traditional shopping experience. “The fusion of online and offline presence is distinctly Indian, reflecting the unique preferences and behaviours of Indian consumers. It bridges trust and convenience barriers, accommodating a shopping journey characterized by a mix of traditional values and modern conveniences,” Prakash explained. For example, Agrostar delivers an omnichannel experience to farmers in rural India, combining online ordering with the personal interaction of in-store pickups.
Evolving Business Models
The report suggests that the next generation of omnichannel brands will not just focus on technology but will introduce new business models that are uniquely suited to Indian consumers. This evolution marks a significant departure from earlier strategies, promising more localized and innovative approaches to retail.
Kanwaljit Singh, founder and managing partner at Fireside Ventures, notes the diversity of strategies that successful brands have employed. “For every Sweet Karam Coffee that leverages quick-commerce as a discovery channel, there’s a boAt that uses it to drive e-commerce bestsellers front and centre. While no single formula works across categories, we have several learnings to share. We believe consumer brands should be omniprepared for omnichannel,” Singh stated.
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Digital First: A Strategy for Growth
The “Decoding Omnichannel” report emphasizes the advantages for digital-first brands in adopting omnichannel strategies. These brands excel in merging online and offline retail, enhancing consumer reach across multiple sectors.
Their success stems from robust product innovation, data-driven marketing, and strong tech infrastructure. These elements facilitate smooth expansion into various offline channels, ensuring a consistent and integrated shopping experience for customers.
Consumer Brands and the Indian Market
Anil Kumar, founder and CEO of Redseer Strategy Consultants, reflects on the evolution of the market over the last decade. “I have tracked the journey of Indian consumer brands over the past decade and a half, where many pioneering brands and platforms established online as a viable channel. With that accomplished, the players are now evolving to broaden their focus by serving consumers wherever they are, whether online or offline,” Kumar remarked.
He pointed out that brands like Mamaearth, which began as online D2C brands, are now deriving significant portions of their revenue from offline retail stores. This trend underscores the flexibility and adaptability required as brands navigate their unique paths towards omnichannel or multi-channel strategies. Hence, making strategic channel decisions based on product category and consumer maturity.
The Road Ahead
As the Indian Retail Market marches towards the $2 trillion mark, the strategies adopted by these pioneering companies will likely serve as a blueprint for others. The integrated approach of combining online capabilities with offline engagement not only caters to the diverse preferences of Indian consumers but also sets the stage for a robust, resilient retail environment.
This comprehensive exploration into the Indian Retail Market, driven by an innovative omnichannel approach, offers a promising outlook for the future of commerce in one of the world’s most dynamic markets.