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MOSL: DEPARTMENTAL RETAIL-Retail Leadership Summit 2020; Preparing to capture growth potential

DEPARTMENTAL RETAIL: Retail Leadership Summit 2020; Preparing to capture growth potential

 

We attended the ‘Retail Leadership Summit 2020’ which saw participation from managements of retail companies across verticals such as grocery, apparel, footwear, furniture, QSRs and restaurants. The discussions provided a sneak-peak into opportunities/challenges amidst new competition and changing business models (read digital advent), as well as the near- and medium-term outlook. 

On an expansion mode

Unlike in the west, retailers across verticals are steadfast in adding new stores with even online players like Nykaa and Lenskart accentuating the idea to expand rapidly. A more striking part is the willingness of retailers to move beyond the mere transactional approach of retailing to more experience-led shopping – something beyond what online already offers. This includes a wider catalogue of products, digital thrust and on-demand services/deliveries. For instance, Bata is opening full-service experience stores including ‘endless isles.’ 

Private labels, new product categories – key pull factor

One key takeaway from all our conversations – particularly with retailers across categories (including apparel players) – is that private labels increase stickiness of customers significantly as they address two things: (i) fill product/category gaps which have lesser options from brands and (ii) improve value proposition with lower cost. This facilitates (i) healthy footfall and growth, even in a highly competitive environment and (ii) better supply chain management and profit margins. For example, Amazon Fashion elaborated how new-age sustainable products with ‘AlcisXNari’ brand made out of recycled products are gaining traction.