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Retail markets in India: By Taponeel Mukherjee As the retail industry story unfolds in India, new strategies come to the fore. Recent news of Amazon acquiring a stake in Future Retail is an indication that the strategy will be differentiated given the nature of the market and consumption trends.
Amazon's acquisition of a stake in Future Retail is in addition to the stake it took in Shoppers Stop, and the earlier Aditya Birla-backed "More" chain.
These acquisitions are an indication that large retail players think that, to gain a greater market share, the online strategy will have to be complemented with an offline route as well.
Online retail sales as a percentage of total sales have shown a tremendous rise, going from 0. While the growth has been enormous and will continue to be fast, the fact that 95 percent of the market is still with the offline sector drives home a few important points.
Access to offline stores provides a vast distribution network and brand accessibility, especially beyond the Tier 1 cities.
Therefore, for a player interested in a higher market share, an offline presence is non-negotiable. Additionally, besides the offline versus online demarcation, it is essential to understand that 90 percent of all retail in India is in the unorganised sector. The key for new players is not necessarily the disruption of the unorganised sector but having access to retail stores that provide organised players with the same distribution networks and concomitant advantages.
Quite often discussions focus on the market share of online versus offline retail. While it is a relevant topic, the more pertinent discussion is the overall retail market growth rate. The greatest value generation for retail businesses is in capturing market growth as greater cash is generated by retail consumption.
A study of large companies around the world showed that almost 80 percent of growth for the companies was driven by growth in the industry segments and successful mergers and acquisition strategies while only 20 percent was through gaining market share.
The key learning for Indian retail players is that while market share matters, being a direct beneficiary of rising incomes in India is a lot more advantageous.
Given the industry dynamics in the last decade, retail e-commerce has dominated headlines. While e-commerce will continue to be a significant sector, the question is: What other exciting opportunities exist in Indian retail?
The creation of niche, sector-focused "digital first" businesses backed by consolidated research-driven manufacturing and distribution platforms hold potential. In the West, businesses such as "Seed Beauty" and "Hatch Beauty" are redefining the retail landscape.
Given the creation of "digital first" brands driven especially by social media influencers, businesses such as Seed and Hatch have been able to speed up product research, development and fulfillment.
The division between manufacturing and branding businesses is what Poornima Vardhan, CEO of th, a luxury-focused platform, describes as the "delineation of product development and manufacturing from the branding and marketing". Such focused businesses hold promise in the Indian retail landscape.
The next decades might also herald the creation of retail platform businesses that "corporatise" a portfolio of Indian brands. The likes of Kering, Richemont and LVMH are examples of hugely successful global retail platforms that have delivered value.
While Indian beauty products, jewellery and fragrances have been marketed to some extent, now is the time to create large scalable platforms that can combine front-to-back retail operations with global scalability for Indian brands.
The ability to match Indian entrepreneurship with global capital and distribution will be the vital driver to create sustainable retail platforms.
There are many "markets" that offer opportunities in the Indian retail space. Therefore, while online mass retailers will look to create an offline presence, online "digital first" niche brands, backed by specialised manufacturing businesses, also hold value.The paper includes growth of retail sector in India, strategies, strength and opportunities of retail stores, retail format in India, recent trends, and opportunities and challenges.
India is the world’s fifth-largest global destination in the retail space. Market Size. India’s retail market is expected to increase by 60 per cent to reach US$ trillion by , on the back of factors like rising incomes and lifestyle changes by middle class and increased digital connectivity.
The global non-athletic footwear market is classified into casual footwear, dress evening footwear, military boots, lite hiking outdoor sandal and others.
On the basis of end use, the footwear market is subdivided into men’s footwear, women’s footwear and kids attheheels.comon: State Tower, 90 State Street, Suite , Albany, Footwear -Industry: Overview The footwear market is a part of retail industry with a global market size of over US$ billion.
It is one of the fastest escalating market with pool of opportunities. Indian appliance and consumer electronics (ACE) market reached Rs trillion (US$ billion) in India is one of the largest growing electronics market in the world.
Indian electronics market is expected to grow at 41 per cent CAGR between to reach US$ billion. Over the past five years (), the Indian Footwear Retail Market has been growing at a rapid pace. The Indian Footwear retail is the fastest growing sector among other sectors of Indian market and is expected to sustain its growth in the coming years.