Reliance and Bharti-Wal Mart will dominate the retail business in India in the near future, observed marketing guru Jagdish Sheth on Tuesday, the second day of the Indian Marketing Summit convened by the Birla Institute of Management Technology here.
Sheth, professor at Emory University, author of over 30 books on marketing, including the acclaimed The Rule of Three: Surviving and Thriving in Competitive Markets, which maintains that there is place for only three major players in any sector, was not sure who the third in Indian retail would be. "I think there will be stiff competition, but only for the third place, and different players, like the Tatas and the Birlas, will end up having a strong presence in different regional markets," he predicted.
Earlier in a videotaped address to the summit, Kishore Biyani, CEO of the Future Group which runs Pantaloon and Big Bazaar, said it was necessary for Indian industry to understand the changes that were taking place in the country. He was gung ho about consumption growing exponentially in the coming years. "Growing consumption is not limited to the big cities alone,” he said. "In India today, everybody is aspirational." He noted that so far Indian businessmen had been “mainly selling commodities, but modern retail will need value added products."
Sheth, however, did not shrink from the flip side of rise of organized retail, painting a grim picture for existing neighbourhood shops. "I would advise their proprietors not to encourage their children to enter the same business," he said. He even predicted that medium sized players like Biyani himself would not be able to survive the coming onslaught of the giants.