Indian retail market to touch $1,200 billion by 2021: Report
According to a FICCI-Deloitte report, the consumer markets are evolving rapidly with the help of technology in an environment where data is the new oil.Updated: Oct 17, 2019 16:45 IST
The Indian retail market will grow to $1,200 billion by 2021 and $1,750 billion by 2026, a FICCI-Deloitte report said, adding that the country’s e-commerce market is expected to touch $84 billion by 2021 and $200 billion by 2026.
“Growth is expected not only from large cities and metro but also tier-2 and tier-3 cities. Organised food and grocery sectors are expected to reach $75.1 billion by 2025 and online shoppers expected to increase from current 15% of the online population to 50% by 2026,” FICCI said in a statement quoting the report ‘Evolve for Consumer’.
The FMCG companies and retailers in India are evolving at a rapid pace and facing major disruption in various parts of the value chain. Innovative solutions, technologically advanced start-ups, hi-tech processes, modernisation and digitisation of back-end operations, tech-savvy consumers, and a growing internet and smartphone penetration are few major factors causing this disruption, Rajat Wahi, partner at Deloitte, said in the foreword of the report.
“Along with these, India’s macroeconomic factors and favourable demographics are fuelling the growth. The supply and demand factors are expected to further accelerate the change of growth in the consumer and retail sectors. In addition, the government is also providing strong impetus to make the business environment more conducive for companies operating in this space through developments in infrastructure (electricity, transportation, digitisation of processes and economy, skill enhancement, Foreign Direct Investment regulations, etc), which is facilitating growth,” he said.
Dilip Chenoy, secretary general of FICCI, said: “While India is one of the world’s fastest growing major economy and has immense potential, there is a need to promote participation and involvement of businesses for furthering the cause of nation building and achieving the societal goals of inclusive growth and empowerment of the people. The industry needs to continue with its efforts to ensure that the advantages of technology are available to all sections of the society.”
According to the report, the consumer markets are evolving rapidly with the help of technology in an environment where data is the new oil. “In such a highly competitive scenario, companies cannot afford to overlook any aspect of the shopping journey and lag behind in the competitive market.”
Consumer experience has become more crucial than ever and brands must constantly innovate to offer novel products and services to cater modern consumers’ demands. In this era of consumerism, it is essential that the companies engage the consumers for better connect before, during, and post their purchases, it said.
The voice of consumer is paramount and brands must channelise all their efforts in understanding the needs of the consumers by analysing their shopping patterns and behaviours. In addition, the industry must evolve to provide seamless retail channels to the consumers, it said.
“Thus, there is a need to organise retail channels and trade. This will lead to an emergence of retail channels with supplementary capabilities, which will add to the convenience of the evolving consumer,” it said.
In an era where consumers have access to multiple brands, channels and options, loyalty can be drawn by going the extra mile where companies can personalise the loyalty benefits for their consumers. Companies must also gain consumer trust, and remain committed to their values, the report added.