The 'new normal' after the COVID-19 pandemic has created the need for retailers to constantly evolve and transform operating models to become more adaptable to technology and enhance the consumer experience, said Deloitte Touche Tohmatsu India LLP (DTTILLP) and Mapic India, in a joint report.
The report, "Rewriting the Rules of New Retail", was revealed at the annual edition of the MAPIC India (formerly known as India Retail Forum) 2021 conference. The report talks about seven key trends fueling the evolution of 'new retail' -- commoditisation and premiumisation; digital success likely to require more effort in the next few years; smaller and closer stores; new models, increasing impact; convenience as the new battleground; health and sustainability; and fragmentation and consolidation.
The modern retail era in the post-pandemic world is being redefined by "evolving behaviour", says the report, adding that business is being re-imagined with a "home cocooned consumer" being habituated to "subscribe" services and consider "convenience" as a critical element to have things being delivered to their doorsteps.
Understanding these needs, the report finds that retailers are adopting the omni-channel strategy -- digitising their operations and focusing on sustainable business practices to operate efficiently. They are also making efforts to be authentic to thrive in a new business landscape.
Amid lockdowns and in the phygital world, companies are adapting to Retail 4.0, which will be the "ultimate convergence of the traditional and online channels".
Rajat Wahi, Partner, DTTILLP, said today's consumer is convenience-craver looking for "value, instant gratification, range, and assortment" in their shopping experience. "COVID-19-induced lockdowns over the past 18 months have dramatically changed shopper journeys and behaviours," he said.
The report said that online research and buying to increased preference for comfort and digital payments/e-wallets, home delivery and ease of returns, and internet-based shopping will continue even as malls and shopping centres open up.
Technology acceleration and adoption across the consumer and retail industries will be critical for surviving and thriving in the new normal. Retail businesses will need to continue to focus on the in-store and online customer experience-led engagement to new consumers.
"Successful brands will have to maintain the right balance between the online and offline channels as we move ahead in a data-driven economy," said Wahi.
The report highlights that now more retail and consumer brands can connect with customers directly (D2C), bypassing existing distribution models and creating new ones. The D2C market is expected to reach $100 billion in 2025, and there are opportunities for brands to innovate.
It flags how companies like Google Cloud and AWS and SalesForce Commerce are enabling the rapid transformation of retail, which makes it easier for retailers to expand online businesses through advanced analytics, better forecasting and demand planning, deeper understanding with their shoppers and business partners.
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