Emerging trends in retail marketing

Authors:
Nidhi Phulwaney , research scholar, Indore, India. Contact:9755107896
Surbhi Jain, research scholar, Indore, India. Contact:9479826924
Swati Jain, research scholar, Indore, India. Contact:9407103999

Abstract:
In todays era, retailing has emerged as a magnificent sector enjoying great
success.This sector is growing at a very great pace, inducing lots of
competition for all the retail operators be it a small colony outlet, mom and
pop store, supermarket, departmental store or a giant shopping mall. Its
influence covers all the retailers and to survive and grow in such competitive
retail era, retailers have come up with astonishingly huge variety of new
trends,emerging today.
In this study,such new trends of retail marketing have been studied.Retail
sector has been categorized into 11 areas of retailing. These include food and
groceries, fashion and apparel, etc. Each of these sub-sectors, have been
studied and the changes in their marketing systems and trends have been
analyzed using secondary data.The focus of this study is to throw some light
on the changes in the marketing tactics as well retail related trends.This will
be helpful for the retailers to understand the intensity of growing competition
and retail happenings so as to make further strategies accordingly.Not only
the retailers, but the customers can also be facilitated by the study.Knowhow
of recent trends,ways of shopping as well as the facilities or add-on
techniques of shopping offered by retailers may help the customers.
------------------------------------------------------------------------------------------------------------------------Key words: retailing trends, retail marketing, retail sub-sectors

Introduction to retail trends

Retail market of India is expected to cross 1.3 trillion USD by 2020 from the
current market size of 500 billion USD. In modern times, retail is expected to
grow up about six times from the existing 27 billion USD to 220 billion USD,
for all categories and segments. Indian retail sector is hastily growing,
accommodating numerous changes in its system as well.

overall retail market

800
700
600
500

overall retail market

400
300
200
100
0
2006

2011

2016

There are several factors that drive the organized retail sector. Few of them
include the following:
-

Comparatively High incomes instigating the purchase

Developing consumption patterns of Indian customers
Newly developing technology and lifestyle trends
easy availability of credit
Increasing consumer awareness

Growth in format of modern trade

Techno savvy customer
E-commerce trend
Social commerce increasing through social networking sites
Multichannel system of marketing etc.

The India retail market was US$ 470 Bn in 2011, accounting for nearly 35% of
GDP and is now expected to reach to US$ 675 Bn by 2016, at CAGR of 7.5%

organized market
90
80
70
60
50
40
30
20
10
0

organized market

2006

Literature Review

2011

2016

Barta,S. et al(n.a.).Trends in retail trade, studied the major trends in

retail sector that are faced by business people and the merchants of
Oklahoma town. They identified 10 major trends that are being in practice in
the retail trade. These include e-commerce, smart cards, globalization of
retail trade, precision shopping, etc. The study has been conducted to
produce ideas for the revitalization and development of the downtown
business people and merchants. It found that entertainmentization of
retailing and knowing your customers is a greatly in practice nowadays in
order to maintain connectivity and influence customers. Use of smart cards
and ecommerce is also in function. Category killers have been identified as a
big challenge for retailers to look over.
Various upcoming trends in each individual sector has been discussed in
Indian retail trends 2014, White paper, TATA bss. These retail sectors
include fashion and apparel, food and groceries, home furnishings and
furniture etc. upcoming trends in each of these sectors, changing customer
preferences as well as relevant strategies have all been identified in the
study. They have also found few key enablers of the retail trends. These are
increasing annual household income, falling communication costs, increasing
penetration of credit and debit cards with higher value limits, increasing
number of online transactions along with the payment modes etc. As a
suggestive strategy, it states that focusing on increasing market access,
creation and management of brand, management of talent and that of
customer experience would be of great help to the retailers in order to cope
up and excel in the frequently trend changing environment.

Another report by FICCI, The Indian kaleidoscope- emerging trends in

retail(2012) states the fact that the Indian retail sectors current estimated
value is about 500 billion USD and is expected to reach 1.3 trillion USD by
2020. This calls for greater connectivity with the customers to provide them
complete experience so as to survive in the growing competition. It states
that the brick and mortar forms of business are converting to technology
driven formats to maintain connectivity with the customers. Therefore the
online and mobile retailing are taken as the new modes to grow. It studied the
effect of economic pendulum and mergers and acquisitions on the retail
environment in India. Despite decelerating world economy, global investors
are interested in investing in India due to strong GDP growth, large customer
base, customer confidence, consumption based pattern of purchasing etc.
Also the big mergers have accelerated the growth of retail in India bringing up
new trends thereon. It also discussed customer experience lifecycle and
stages of customer experience. They say that to be a dynamic retailer, one
has to be proactive, connected and empowered.
Emerging trends in Indian retail and consumer 2011 by Technopak
have also studied the various retail segments like durables, fashion and
apparels, beauty services, health and fitness etc, with the help of appropriate
facts and figures. They consider online retailing as a popular trend. Non-store
retailing is currently estimated at USD$ 3.2 billion and is likely to be growing
at the rate of 23%. The key changing consumer patterns identified are
consumer is redefining the value, accelerated consumption, increasing urban
population, new cities and towns acting as new consumption centers, women
consumer power increasing, time consciousness leading to concept like online
retailing, multilevel marketing, hypermarkets and malls (giving all under one
roof), category killers, etc. Business models are also converting from
conventional forms to single nation headquarters and local partners to have
geographical reach. To be a successful retailer in the trending environment,

few key success factors have been identified like local market adaptation,
right real estate, getting the right partner, differentiation through service and
many more.

Objectives of the study

To
To
To
To

create awareness about the changing retail environment in India.

highlight changing consumption patterns and consumer preferences.
bring in notice the upcoming trends in Indian retailing.
discuss probable strategies that could be adopted by the retailers

owing to changing customer mind set and the emerging trends of retail
trade in India.

Research Methodology
Research design : The research design is descriptive in nature where the
details related to Indian retail system has been studied and discussed using
secondary data.
Data collection : Secondary data has been used from the various existing
reports and the existing literature have been studied.
Data analysis : No statistical tool of analysis is used. The content and
statistics mentioned in the reports and the information provided in the
literatures have been self analyzed.

Results and Interpretations

Trends and their impact

The Indian retail sector acts as a great platform in order to provide
opportunities to retailers as well as for the various available brands
throughout the world. Globalised world has contributed in changing lifestyles,
changed consumer patterns and preferences and increased competition. It
has also led to the emergence of new trends in the market which creates a
drastic impact in the minds of customers and therefore, the retailers growth.
In this study, major trends among 11 subsectors of retail segment have been
discussed that impacts the businesses in the retail trade sector.
1.Food And Groceries
Hypermarkets and alike modernized shopping premises and Franchising will
be upcoming moreover to bridge the gap between unorganized and
organized grocery traders. Besides, E-retailing will increase significantly for
food and groceries. This helps in achieving a competitive edge to the retailers
.Cold chains would be of great benefit for this purpose.
Private label brands would come up more in this segment suppressing the
growth of manufacturers brands. Also, the trend for organic food and
processed food on increasing their demand. Food and Grocery market is
expected to reach US$ 425 Bn by 2016 (63% of the overall retail market ), at
CAGR of 5.5% whereas, The organized Food and Grocery retail is expected to

grow upto US$ 34 Bn by 2016, @ CAGR of 30%.

60
50
40
total market

30

organized
market

20
10
0
2006

2011

2016

2.Fashion And Apparel

Youth of India are following the fashion of online ordering. Their preferences
for foreign brands is also very significant. Retailers therefore would continue
the entry of foreign brands and also e-commerce platform would be
intensified further. Besides this, price discrimination for daily wears and
party/event wears would be required. All these will lead to marketing through
multi channels by the retailers.
Retailers will also take their in house brands on a serious note. This will lead
to formation of their exclusive showrooms in compact format, where focus will
be on generating productivity of space as well as the intense assortment of
stock. Promotion of in house brands might be done through in-film
placements, celebrity endorsements or event sponsorships.
Fashion for kids will include increased brand licensing bringing up the trend
inspired from cartoon characters, bollywood and cricket stars.
Apparel market in India was US$ 35 Bn in 2011 and by 2016 it is expected to
reach US$ 50 Bn, @ CAGR of 7.5%. The organized Apparel Indian retail market

was US$ 5.5 Bn in 2011 and is probable to grow to US$ 8 Bn by 2016, @ 8.5%
CAGR

60
50
40
total markeyt

30

organized market

20
10
0
2006

2011

2016

Fashion and apparel

3.Furniture And Home Furnishings

The Home Furnishings and Furniture market would reach upto US$ 17 Bn by
2016. Its organized retail market in India is estimated to grow from US$ 0.7
Bn in 2011 to grow to US$ 1.2 Bn by 2016.
Various customized items will have their preference. customization in design
as well as color will be demanded. Besides quality consciousness, Indian
households would prefer changing items leading to frequent purchases.
Exchange scheme in furniture and kit system in furnishings would mostly be
preferred. Online purchase of these items are also gaining momentum with
the backup of money back guarantee ,if not as per requirement.

18
16
14
12
10
8
6
4
2
0

total market
organized
market

206

2011

2016

Furniture and home

furnishings

4.Consumer Durables And Kitchen Appliances

The Consumer Durables market in India is expected to grow at US$ 43 Bn by
2016, at 13.5% CAGR from US$ 23 Bn in 2011.
Online presence of retailers would increase so as to facilitate their buyers with
shopping at just a click away. Many private label brands are also expected to
emerge in this segment. Retailers would promote through multi channels to
have more relevance with their customers. Online retailers would focus on
price sensitivity of Indian customers and hence bringing up various price
promotionals backed up by manufacturers guarantee and cash on delivery
approaches. Exchange of durables or providing platform for dated but items
in working conditions , will also gain momentum. This allows purchases in
shorter purchase cycles for the durables. Exclusive showrooms with multi
brands durables offering efficient services might also emerge since there is

very less scope of discrimination for retailers in this segment except the
servicing.

5. Jewellery Retail
Jewellery would now be a need as an extravaganza and not for mere
investment purpose. Treating it as a luxury need would require for more
special designing and best quality. It is now seen as a symbol for moving
towards upward trend in lifestyle and social status. This leads to
consciousness of customers about what they buy and from where. Hence,
exclusive brands of jewellery will be of great interest.
The recent trend of possessing unique pieces through ordering customized
jewellery is time consuming. So, customers now move onto designer finished
masterpieces readily available. This will require retailers to maintain
appropriate inventory as well enhance the purchase environment through
visual merchandising.
Also, customers would instead of demanding precious jewellery like that of
precious gems or diamonds, they would prefer costume jewellery. Precious
jewellery would have decreased shelf life as compared to costume jewellery
that act as accessories with the apparels relevant to the event or occasion.

Men will also have their interest in luxury destinations where they are availed
with diamond watches or other accessories with precious gems.
Customers today, have reduced their preference for weight of the jewellery
possessed, instead the trend of having more number of pieces has gained
momentum . Therefore, the masterpieces with low weights will take place in
the shelf, so that customer can frequently buy such low weight designer
pieces and increase their possession in numbers to use them alternatively.
The Jewellery & Watches market in India is estimated to grow to US$ 44 Bn by
2016, @

CAGR of 11.5%.The organized Jewellery & Watches retail market is likely to be

at US$ 7.5 Bn by 2016,at CAGR of 25%.

50
40
30

total market

20

organized
arket

10
0
2006

2011

2016

jewellery

6. Quick Service Formats

Such formats of retail outlets are burgeoning and for the national brands, it
would be a requirement to manage their reach through vigorous franchising.
Private labels are also expected to come up to serve products purchased
impulsively like branded cookies etc. Presenting International food with the
Indian twist as well as standardizing the street foods ,offering at premium in
a hygienic outlet will also be welcomed.

18
16
14
12
10
8
6
4
2
0

total market

2006

2011

2016

Quick service

7. Beauty Services
This service segment faced a gradual shift from US$ 0.6 Bn in 2006 to 1.3 in
2011 and is expected to reach USD$ 3 Bn in 2016. This segment highly enjoys
customer loyalty. Customers prefer their loyal service providers in case of
beauty. Experimented variations are also preferred nowadays which creates a
space for new comers, providing distinguished services, using new gadgets
and technology at affordable prices. Few high class people might also prefer
them at premium prices. Concept of packages or price bundling is preferred
significantly nowadays. New stylist may also open up their private label
services especially the international ones. WOM (word of mouth) and
attractive service environment with personalized tips and guidance, works
well with beauty services.

3.5
3
2.5
2
total market

1.5
1
0.5
0
2006

2011

2016

Beauty
services

8. Specialty Retailing
This includes eye wears, books, stationeries, gifts etc. online conversion of
these items have come up in order to enhance their sales like e-gifts, e-cards,
e-books , e-vouchers etc. Customized and personally availed services are
more preferred and new service providers are expected to increase.

25
20
15

total market

10

organized
market

5
0
2006

2011

2016

speciality

9.Food And Beverages

The Food & Beverages Services in India is likely to grow US$ 16 Bn by 2016,
at 12.5% CAGR. The organized market in was US$ 1.5 Bn in 2011 and might
grow to US$ 6 Bn by 2016, at CAGR of 30%.Youth of India are bending
towards such items increasingly. The trend of small instantly planned parties
increases their consumption. Beverage manufacturers should ensure their
availability in the retail outlets. Loyalty towards such items is generally not
present and hence, their availability, offers, celebrity endorsements etc may
enhance their preference. Variations in food and beverages are also
welcomed nowadays. conventional taste and presentation should be replaced
with new ingredients, new flavors as well as distinguished complimentary
items.

18
16
14
12
10
8
6
4
2
0

total market
organized
market

2006

2011

Food and
beverages

2016

10. Electronics and Personal Computing

The organized Consumer Electronics market was observed at US$ 4 Bn in
2011 and by 2016 it is most probable to grow to US$ 18 Bn.
The multi brand retailers are focusing on converting their product attributes
into customer experiences. Novel devices will be made to impress customers
and on to their product experience. Mobiles with portable solar energy kit will
be of great attraction. Online retailing is more preferred as it adopts
aggressive pricing as well as the instant comparability of products and their
features facilitates customers decision making. Brick and mortar type
retailers may differentiate themselves from e-retailers only by their services.

50
40
30

total market

20

organized
market

10
0
2006

2011

2016

electronics

11.Health And Fitness Services

Growing health consciousness can be clearly seen from the statistics saying
the growth of this segment from USD$ 0.4 in 2006 TO USD$ 2.5 in 2016.
Similar to beauty services, these also work well with new gadgets and
technology. Personalized services with special guidance is highly appraised.
Service providers must focus on interactivity with the customers while
providing services as per their individual requirements. Eye-catchy
environment, customized services with special packages and offers, no side
effect guarantee and providing services customized shifts relevant to
customers will be of significant benefit.

3
2.5
2
1.5

total market

1
0.5
0
2006

2011

Health and

2016

Major common trends

Looking up for the overall changing and growing trends in the Indian retail
sector as a whole, There are a few such trends found that are being readily
practiced nowadays and that affect the whole retail trade system. These are :

Retrofitting the function of Marketing

Marketing is no more a management function in isolation. It needs integration
with other roles and functions especially with that of Information Technology
to facilitate growing digital marketing.

Emphasis on store theatrics

In- store environment is now the emphasis of retailers. They are trying to
attract customers through store environment in order to facilitate shopping,
entertain and engage them within the store to enhance sales. This is being
done through various POPs, interactive displays etc.

Increasing shopper connectivity

Connectivity with customers is nowadays being increased by providing Wi-Fi
in the store. Other ways include premium rewards like exclusive accessibility
of products, promotional discounts, loyalty points etc.

Integrating online buy, store pick up

Its a strategy to induce online customers to visit the outlets ,though its just
for the pickup of their ordered product. This ensures connectivity and loyalty

with customers and customers might also purchase items available in the
shop.

Focus on interactions with shoppers

Interacting with shoppers in store through greeting them, helping them buy
things, etc. or even contacting them through post purchase services , is also a
growing trend.

Optimizing format of the store

Organizing the store in a relatively different format is a new idea engaging
and satisfying customers. These include vending machines or branded
boutiques etc in a large store format, availing seating areas, coffee and food
kiosks, mobile charging facility etc.
The above mentioned various emerging trends in each of the segments or the
retail sector as a whole, puts significant focus on customer connectivity,
technological adaptation, e-retailing, personalized services, affordable
scheme and dynamic approach. Adopting these tactics will help retailers to
maintain and grow along with the growing retail trends in India.

Conclusion
This paper studied the scenario of various retail segments in India to highlight
the emerging as well as upcoming trends and practices. The major findings
include that the consumption pattern of customers and their requirements are
drastically changing. Customers require personalized services in beauty and
fitness segment whereas readily available masterpieces with less weight

more variety is required in jewellery segment. E-retailing has come up almost

in all of the segments. Electronics and durables have exchange schemes as
their new trend. Private labels are also in trend in several segments like
durables, fashion apparels, etc. Customers are also seeking variations in food
and beverages and in Quick service formats. Solar energy portable kit will be
the new trend in electronics segment. Besides, the promotional offers,
exclusitivity, in-store attractiveness, online availability, and shopper
connectivity are highly required. This study emphasizes on trends and
required tactics to help retailers of India to align themselves with the dynamic
retail environment.

Suggestions
Here are the suggestions for the retailers to undergo practices that would
help them differentiate themselves and grow in the times when retailing in
India is facing frequently changing trends.

Identifying target customers changing shopping patterns and

preferences.
Adopting e-commerce platform
Strong or aspirational Brand creation and management
Increasing customer experiences.
Local market adaptation
Differentiating through services provided.
Developing local supply chain
Wide product range.
Appropriate pricing scheme.

Limitations
This study has several limitations though it has been undertaken to the best
of efforts. These are

Time limitation was a big challenge for analyzing the topic of the study.
The study relates to the customers analysis and trends of India only.

Availability of limited resources required to undertake the study.

Assurance of coming trends is not possible since human factor is
involved and human mind set may not be predicted exactly.

References
Barta,S. et al(n.a.).Trends in retail trade,Oklahoma cooperative
extension service AGEC 565,Oklahoma state university

Indian retail trends 2014, White paper, TATA bss.

The Indian kaleidoscope- emerging trends in retail(2012) ,FICCI,PWC.
Emerging trends in Indian retail and consumer 2011 by Technopak.