A recent report by PwC India highlights that 60% of brick-and-mortar retailers believe technology can enhance their competitiveness in a rapidly evolving market. However, despite the growing consumer shift toward digital shopping, 53% of retailers have yet to adopt digital solutions, even as 45% of consumers now prefer an omnichannel approach to shopping.
Technology: A Game-Changer for Indian Retail
The report, The Retail Reinvention Paradigm: How Brands Could Up Their Game, underscores the importance of AI-driven analytics, mobile applications, and modern Point-of-Sale (POS) systems in improving operational efficiency and customer engagement.
Ravi Kapoor, Partner and Leader, Retail and Consumer at PwC India, stated:
“The future of retail belongs to those who seamlessly integrate innovation with localised strategies, leveraging data analytics and consumer insights to tailor offerings and drive sustainable growth in a competitive market.”
E-Commerce and Quick Commerce Disrupting Traditional Retail
The study reveals that 34% of traditional retailers feel the impact of e-commerce and quick commerce, which are reshaping the Indian retail sector. To counteract these effects, retailers are now offering credit options, free home delivery, and personalised services while also exploring omnichannel strategies to stay competitive.
The shift toward digital convenience is clear, with 50% of consumers preferring to shop online for products like apparel and beauty. However, physical retail remains relevant for tactile engagement, as 36% of consumers still prefer in-store shopping for fresh produce and home furnishings.
The Rise of Quick Commerce and Its Impact
Quick commerce is gaining traction, with 65% of metro and Tier 1 consumers relying on instant delivery platforms for essentials. This has led to a 28% decline in foot traffic at physical stores, as more shoppers prioritize speed and convenience over traditional shopping methods.
Urgency is another major factor driving adoption, with 42% of consumers in metro and Tier 1 cities turning to quick commerce platforms for last-minute needs. To combat this shift, 64% of brick-and-mortar retailers are self-funding their marketing initiatives while advocating for fairer logistics policies.
Adapting to the New Retail Landscape
Retailers are actively adjusting their strategies to meet changing consumer expectations:
- Dark Stores: 21% of retailers are exploring these fulfillment centers, with 10% already implementing them to improve delivery efficiency.
- Post-Purchase Support: 40% of shoppers prioritize flexible return policies, and 39% seek better after-sales service and payment options.
- Tier 2 and 3 Market Trends: In these cities, 41% and 39% of consumers, respectively, emphasize the need for strong post-purchase support.
The Retail Reinvention Framework
To help retailers navigate these changes, PwC India’s report introduces a Retail Reinvention Framework that merges traditional and modern retail strategies.
Also read: India’s Private Consumption Reaches $2.1 Trillion: Deloitte, RAI
Key recommendations include:
- Leveraging AI-driven analytics to understand consumer behavior.
- Enhancing digital interactions through mobile apps and omnichannel retailing.
- Adapting business models to reflect geographic and consumer utility profiles.
By embracing technology and experiential retail, brands can create immersive shopping experiences that fuel long-term growth and consumer engagement in an increasingly digital world.
