Retail industry to witness transformation due to tech disruptions, data-led opportunities: Report
A joint report by industry body Assocham and Primus Partners suggests that the heightened focus on hygiene will prompt consumers to be willing to pay for sanitation efforts in malls, cinema halls, etc.
The Indian retail industry is expected to be driven by data-led opportunities and artificial intelligence, said a joint report by industry body Assocham and Primus Partners.
The changing consumer preferences is driving the need for the digitisation of stores, and increased integration of micro, small and medium enterprises (MSMEs) across the value chain will further accelerate the growth of data-driven retail, it added.
"The role of offline stores is likely to change, focusing on experience and collection. Consumers, to avoid crowds, would prefer to 'buy and pay online, maybe pick-up in-store', as a way of stepping out of their homes," said Assocham-Primus Partners' joint report.
The unorganised segment has dominated the Indian retail sector and in 2019, the segment commanded as much as 85 percent of the market, show-casing the significant potential for digitalisation.
"The Indian retail industry is expected to transform owing to technology-disruptions, driven by artificial intelligence and data-led opportunities," it said.
Moreover, in the coming times, the products and services that make people more independent will witness an increase in demand.
"Items like washing machines and dishwashers would be in demand to reduce dependence on support staff for household chores. The heightened focus on hygiene will prompt consumers to be willing to pay for sanitation efforts in malls, cinema halls, etc," the report said.
The report, based on inputs from industry experts, health professionals and drug regulators, noted several unfolding consumption patterns which mostly point towards safety concerns, ease of living at home and workplaces even as the economy has mostly been opened.
The rising fear of infection would drive consumer behaviour across segments, especially the purchase of food commodities. It expects sales of packaged products in food and staples to grow though a large proportion continues to be sold loose in segments as wheat, rice, pulses, spices etc.
"However, in the coming days, branded food commodities are expected to witness an increased demand owing to the perception of quality, hygiene, safety standards and source credibility. Customer re-assurance on these parameters will help create a more robust organized segment for food products," it said.
With the reverse migration of workers to their villages from cities, a good monsoon, an increased government expenditure of 40,000 crore through the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) and public projects are likely to ensure "increased demand from rural India and an area for FMCG companies to focus on".
Edited by Kanishk Singh