The Future of eCommerce: Retailers Must Evolve Now or Eventually Fall
The Indian retail industry currently ranks among the world's top five retail markets. The world of retail is undergoing an unprecedented wave of innovation not just in the metros, but in Tier 1 and 2 towns as well. New business models and evolving consumer behavior are the key drivers for the digital change, India is experiencing. The shift from offline to online; is the trend soon to take over Indian market.
Online shopping today is largely driven by price and convenience – a good deal on products that are delivered quickly.
AdvertisementBy 2026, these fundamental desires will still exist, but expectations of the shopping experience would have changed drastically. Consumers will be demanding more from eCommerce providers, such as the ability to discover in real-time unique goods they will not find in big-box retail chains. Moreover, better exchange or return policies, trial at home offers, booming mobile payments will definitely increase online shoppers. Consumers today prefer shopping online, choose from a variety of options, without the hassle of getting stuck in traffic or hopping from one market to another.
For businesses to stay relevant 10 years from now and beyond, here are two key developments that must be considered:
The Term ‘Online Pure-Play’ Will Be Eradicated by 2026
For many customers, one initial trial is both required and sufficient to establish the trust necessary to make future purchases without having to physically see and feel each new product. As such, while new entrants to retail will no doubt start from an online pure-play perspective, they will inevitably move to test out physical retail space with pop-ups, complemented by collections or showcase stores to facilitate product discovery and trial.
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Hence, pure-play online retailers will have to further develop their physical presence to enhance fulfillment and customer service. For most, this will take the form of partnerships along the lines that are emerging today, such as the ‘click-and-collect’ model. Brands will soon take the reverse route of online to offline strategy.
AdvertisementOne example is that of
From now till 2026, physical retailers will continue to reduce the amount of physical space they hold, switching their investment emphases online. Physical stores in premium locations will shift their focus from offering a large range of products to enhancing customers’ in-store shopping experience. This will give rise to the integration of technology, such as big data, virtual reality, and augmented reality, to create interactive and highly engaged retail environments. Online retailers, on the other hand, will invest further in establishing the physical presence, mainly to enhance fulfillment and customer service and give the customer the brand experience. As such, the term ‘pure-play’ will be rendered obsolete. Companies like
Becoming Mobile-First is Key
AdvertisementWith the expectation of online shoppers in India reaching up to 175 million by 2020, the second largest smartphones market - India, is the most potential market for e-commerce brands. With a wide range of availability of smartphones and internet at an affordable price, major online traffic on e-commerce platforms comes from mobile devices. Moreover, with the genesis of in–app availability, online shoppers are taking a move from e-commerce to m-commerce.
With this, phones have become the first point of brand interaction with their users. The smartphone may represent the most personalized medium to reach India’s consumer audience. Thus, it will soon become the dominant channel for loyalty programs and rewards, due to its ability to provide levels of interactivity and engagement that traditional programs cannot match.
As consumers are increasingly interacting with brands and each other through digital content and services on mobile devices, desktops, apps, and tabs; it is important that retailers understand the user journey. Apps are fast becoming the best channel for user engagement, online sales of both small- and big-ticket items, and tracking of performance metrics like conversions, product views, and average order values. Therefore, retailers should become familiar with application-based and cross-device advertising and messaging, to reach users in a more customized way and help users experience the brand before buying products/services online. According to a recent user trend study, an average Indian user installs 32 apps on their mobiles.
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Another rapidly picking up trend is that of ‘contextual location’. As a natural extension of mobile becoming mainstream, ‘contextual location’ will become an integral part of the retail experience. The ability to identify a user’s location and deliver targeted, timely and relevant information and messages are a powerful and compelling proposition. Moreover, the real-time aspect of location analytics will offer a more adaptive approach to marketing, enabling retailers to adapt their engagement tactics in real-time to meet an individual consumer’s needs. Cab services Uber, Ola are already using this model to ease the pickup and drop location. Moreover,
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AdvertisementThus retailers who can integrate the mobile web, apps, in-app targeting and contextual location into today’s business operations and engagement strategies will set the stage for seamless adoption of newer mobile technologies or add-ons when required.
This article was originally authored by Dushyant Sapre , Commercial Director, Criteo India
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