The post Why are Indian retailers citing a wrenching slowdown? first appeared on PHYGITAL RETAIL CONVENTION (PRC).

The post Here’s how retailers and e-commerce platforms use Generative AI first appeared on PHYGITAL RETAIL CONVENTION (PRC).

New Delhi: When Radio-Frequency Identification (RFID) was introduced over 50 years ago, it held a lot of promise, especially in an industry like retail that required precision in inventory management. Owing to its high costs, the technology didn’t see much adoption despite its potential.

However, the technology not only persisted but has evolved over the years to become more relevant and affordable, making it one of the preferred choices for retail decision-makers. A significant 58% of warehouse decision-makers plan to deploy RFID by 2028 which will help increase inventory visibility and reduce out-of-stock, according to the Warehouse Vision Study 2023 by Zebra Technologies, which helps organisations monitor, anticipate, and accelerate workflows with technology.

Furthermore, a majority of warehouse decision-makers plan to deploy fixed, passive or handheld RFID readers that can better track assets, workers and goods throughout the warehouse environment, the study found.

There are multiple areas where retailers are trying to use RFID to either enhance customer experience or reduce the cost of operations, say experts.

“RFID is a technology which is very old and going to have a huge impact in retail as it is now available and accessible,” said Ranjan Sharma, CIO and Supply Chain Head, of Bestseller India, a fashion and apparel brand.

Why RFID?

Retail operations pass through a series of steps from inventory to return management. Often, keeping track of all the stages manually becomes laborious and ends in errors and delays and impacts profitability.

According to recent data from Shopify, which helps small businesses build an online presence, inventory is the largest expense for retailers. For every dollar US retailers make, they have $1.40 of inventory in stock.

An inventory cost is the total of purchase costs, ordering costs, holding costs and shortage costs. Today, RFID plays an important role in managing these costs and the digital transformation of retailers especially with the rise of e-commerce, say experts.

How Retailers Use RFID

“RFID technology is typically used where there is a high volume of items moving quickly in and out of an area and where there is a high selectivity and multitude of sizes, colours and styles,” said Rajnish Gupta, VP & Head, India and Sub-Continent business, Zebra Technologies.

While experts have named inventory management as the most common use case of RFID, there are different areas where the technology has shown its results. These include:

Customer Experience

E-commerce giant, Amazon uses RFID to ensure customer satisfaction and ease of operations, its ‘Just Walk Out technology store,’ which first debuted in 2018 uses RFID to expand the potential for checkout-free technology to clothing, soft lines, fan gear, and more.

“Customers love being able to grab what they need and get on their way without having to wait in line, and store owners and retail operators have embraced the cost-efficiency and revenue-driving benefits of Just Walk Out technology,” said Jon Jenkins, Vice President, Just Walk Out technology, AWS Applications in a blog post.

Just Walk Out technology uses cameras, shelf sensors, sensor fusion, and artificial intelligence (AI) technologies, like computer vision and generative AI to enable retailers to sell a wide range of products, such as food, beverages, groceries, home goods, and more.

As per the data from Amazon, there are more than 70 Amazon-owned stores, and more than 85 third-party retailers with Just Walk Out technology located across the U.S., UK, and Australia.

Experts from Zebra Technologies told Phygital Bureau at the sidelines of the Warehousing Vision Study 2023 launch that the company recently launched a modern store which offers the best example of an RFID-enabled shopping experience.

Sharing one instance of how RFID is redefining experience, Sanjay Nare, Pre Sales Head – India & Sub Continents, Zebra Technologies said that as soon as a person tries on clothes, the RFID antenna detects the size and automatically gives options for matching apparel, and accessories.

This experience gets more interesting when a customer delves deep into the shopping experience finding various fits, sizes, designs etc.

Operational Efficiency

RFID has a lot of impact on improving operational efficiency. “RFID used to be ‘nice to have’, but with supply chain visibility and inventory accuracy becoming more crucial, it is now essential for today’s omnichannel companies,” said Saurabh Surya, VP – of Technology, Smaaash, a gaming and entertainment centre spread across India.

Speaking about how the brand uses RFID, Surya shared that before the adoption of the technology, Smaaash offered coins to play any arcade game that featured coinbox technology.  However, handling coins used to be a laborious operation because cashiers had to keep an eye on the quantity.

With RFID, a single card to customers helps store the value charged that gets utilised after every single game played.

For Smaaash, one advantage of adopting RFID cards is their ease of use. It helps obtain comprehensive user statistics from the RFID card, including the number of games played, the category games the users prefer to play, the propensity for redemption, the number of FEC visits, and the visiting hours.

He added that thanks to RFID, the number of cashiers as well as the operations team size has decreased resulting in cost savings.

Store Management

A typical store opens and closes 30-45 minutes before and after customers come and leave to check inventory.

With RFID, this time frame is now just 10 minutes, helping store employees complete work faster and in a way easing the store opening and closing process.

This results in significant savings on manpower and overtime payments to staff.

Store Data Analytics

RFID helps keep track of the exact SKUs and their status. It can provide the exact number of items that have moved from the shelf to the trial rooms in a typical retail store.

This helps retailers get an idea of what customers prefer so they can rethink the placement of less moved items.

These insights into customer preferences help understand which product styles are fast-moving, and which are slow-moving, helping brands take action much faster than in the past.

Returns Management

Often, products that get returned are not added to the store inventory and remain unaccounted for in the warehouse.

This leads to losses and an erroneous view of inventory. With RFID, stores can get it back to the inventory much faster and ensure that it is back on the shelves.

Shrinkage Control

Shrinkage is the losses which retailers incur either in stolen goods or goods which get out of inventory and don’t come back into inventory.

RFID helps control shrinkage. And that can have a significant impact on replacing some of the systems like anti-theft systems. These technologies can all be combined into one significant savings in capital investments for retailers.

GI Tagging

Experts from Zebra added that a lot of work in RFID is happening around GI (geographical indication) tagging. For instance, clothing made from Egyptian cotton will have a tag that denotes that the cotton is actually from Egypt and not from somewhere else. GI tagging ensures the authenticity of the source of raw material for a product.

The Cost Factor

Gupta from Zebra says that, over time, the cost of implementing RFID technology has reduced significantly, making it more accessible for retailers of all sizes to adopt.

Although RFID has been around for some time, the cost of tags has come down dramatically only in the last few years.

According to Surya, the average cost of an RFID tag has decreased by 80% to 4 cents. “The ROI will be achieved in a maximum of two to three months,” he said.

Game changer

Over the past 10 years, the read accuracy of RFID has doubled and the range has more than quintupled (allowing for fewer devices and better scans). Today, the technology enables real-time visibility, heightened accuracy, and greater automation, which translates to vastly improved operational efficiency, time and cost savings and improved experience.

“RFID has use cases and capabilities to solve problems that we could have never thought of earlier. With pricing no longer a barrier, it’s going to become a game changer,” added Sharma of Bestseller.

The post Why are experts excited about RFID in retail first appeared on PHYGITAL RETAIL CONVENTION (PRC).

New Delhi: Delhi’s upscale Khan Market is the 22nd most expensive retail high street location in the world with an annual rent of $217 per square feet, according to Cushman & Wakefield.

It ranked 21st last year.

Real estate consultant Cushman & Wakefield on Tuesday released its report, ‘Main Streets Across the World’ that examines prime retail rental rates in key cities globally.

“Delhi’s Khan Market features amongst the top 25 most expensive main street markets in the world. With pre-pandemic to present growth (during September quarter) at 7 per cent and a 3 per cent year-on-year growth in rent in terms of INR, Khan Market ranked 22nd on the coveted global main street list,” Cushman & Wakefield said in a statement.

New York’s Fifth Avenue retains its top ranking as the world’s most expensive retail destination. Milan’s Via Montenapoleone jumped a spot into the second place, displacing Hong Kong’s Tsim Sha Tsui, which slipped to the third position.

New Bond Street in London and the Avenues des Champs- lys es in Paris retained the fourth and fifth positions, respectively.

The biggest mover was Istiklal Street in Istanbul, which rose from the 31st to 20th position in response to inflation which caused rents to more than double over the past year, the consultant said.

Saurabh Shatdal, managing director, capital markets, Cushman & Wakefield India said, “Indian main streets, especially the prominent ones, have benefitted from a dearth of space across quality grade retail malls. Main street rentals have grown by 10 per cent y-o-y average.”

“One of the main reasons behind this is that while demand for retail space has been recovering strongly post pandemic, supply of grade A quality malls hasn’t kept pace,” Shatdal, who has recently been given the additional charge of Head Retail, said.

With an influx of premium brands into main streets, he said the demand for space in main streets experienced a fundamental uplift, both on rents and character.
“Given the momentum and strong demand being witnessed in the retail sector, we will continue to see traction in the segment in the coming months,” Shatdal said.

Cushman & Wakefield noted that the top five most expensive main streets in India are Khan Market, Connaught Place (Delhi), Linking Road (Mumbai), Galleria Market (Gurugram), and Park Street (Kolkata).

The post Delhi’s Khan Market 22nd most expensive high street retail location globally: Report first appeared on PHYGITAL RETAIL CONVENTION (PRC).

Metaverse Reality Check
Now that the marketing value of digital fashion and NFTs is clear, brands still need to distinguish between concrete opportunities from the hype ‘to generate sustainable revenue streams presented by growing consumer engagement with the Metaverse,’ the report states. According to bullish observers, says McKinsey, five years down the line, mass consumer adaptation of the virtual world will create the biggest opportunity for the fashion industry since the revolutionary e-commerce. They also predict that the hype around the metaverse will fade ‘as technologies fail to meet expectations or users prove reluctant to use virtual spaces as extensively as some business plans are counting on.’

Hyper Personalisation
According to the report, brands now have access to an array of personalisation tools and technologies. They can now upgrade and personalise their customer relationships. Now, top executives have an opportunity to harness Big Data and artificial intelligence to build long-term loyalty by providing one-to-one experiences. Consumers are now looking out for personalised products and brands. The report reveals, ‘Seventy-one per cent of global consumers want companies to deliver personalised communications and products and 76% are unhappy when this is not offered.’

Connected Stores
The inevitable rise of e-commerce has made retailers rethink their physical store strategies. ‘Fashion executives can address consumer pain points by using in-store mobile Apps to enhance the in-store experience and micro-fulfilment technologies to leverage the store for the quick-commerce era,’ says McKinsey. According to their report, though rules of physical stores are changing, they are far from dead. There’s an opportunity to reshape the overall retail mix.

End-to-end Upgrade
Various digital and analytics tools have transformed key parts of the fashion value chain, but they are often confined within the organisation. For a more efficient and profitable way of operating, brands should embark on an end-to-end value chain. They need a new digitised value that unites multiple internal processes and data sources. The report says, ‘When it comes to digitisation, 61% of fashion executives believe end-to-end process management is among the most important investment areas for their organisation between 2021 and 2025.’

Traceability First
To effectively reach deep into the supply chain to understand the lifecycle of a product, fashion brands need to combine traceability systems powered by traceability software and Big Data, according to McKinsey. Growing consumer awareness has resulted in fashion brands being held accountable for their environmental and social impact. According to the report, a common data language is essential for comparability, making it easier for suppliers and manufacturers to share data with multiple brands.

The post 5 Themes to Unlock Consumer Opportunities first appeared on PHYGITAL RETAIL CONVENTION (PRC).

The great Indian retail sector is expected to create around 25 million jobs by 2030. The increased demand for organized retail has already helped to create a capacity of around 120 million square feet in retail space across major Indian cities, even as Tier 3 towns and cities and those below, as well as semi-urban clusters are all set to take off in a big way.

While the industry is growing at an unprecedented pace, it has also emerged as a fiercely competitive sector. The tremendous growth has brought many changes, challenges, and disruptions for every stakeholder, including producers, manufacturers, suppliers, retail store owners, and customers. Retail store owners and suppliers are committing themselves afresh to upgrading their strategies given the new market trends and consumer behavior.

The question is, are the retailers ready enough to take a front seat in the fiercely competitive market, which is going to be full of opportunities and demands. To buy real estate in those six inches – “customer’s mind” and to get a chunk from their wallet will demand an innovative-creative approach. The first movers will be ruling as always, however, this time innovative retail fixtures solutions will be a path to reach into the hearts and minds of shoppers.

Retail stores are no more a storage place or a selling outlet that only provide goods to the customers; stores are transforming into experiential buying destinations. The retail store owners and brands are putting their energy and hard work to get a place in the customer’s minds, and their wallet share.

In today’s digital age, the e-retail space is also expanding tremendously and working relentlessly to provide seamless user experience and match on-time delivery expectations. However, to achieve this, they are reinventing their strategies by setting up pop-up stores, experience zones, expansion of their warehousing units, and much more. On the other hand, brick & mortar stores are targeting a smooth, convenient offline buying experience to drive more footfalls. For e-commerce, supply, storage, and movement play a vital role; and for the offline retailers, movement, display, and storage solutions in the stores make a huge difference to attract customers’ attention and to increase sales.

Today, customers don’t enter a store just to buy a product; rather they look for a wholesome in-store experience. And to achieve that, traditional practices must take a back seat, as today, every customer looks for immersive facilities and services. The store layouts, display placements, storage capacity, and movement facilities are the key to create a differential and enhance visual merchandising that plays a crucial role to drive sales. Stores are now a community hub for the customers to have a good time while buying their daily need goods. In this context, a store’s color scheme, in-store atmosphere, hassle-free purchase, relevant product options, payment methods, movement space, flexible timings, localized suggestions are the factors basis which a customer selects a place to shop.

While setting up a retail store, owners must have a logical behavioral-packed approach to design their outlet. In most cases, customers have 170 degrees of vision; they usually avoid congestion in passage areas, and want offers and seasonal sale information loud & clear, etc. Keeping these in mind, even minor tweaks and changes can make a huge difference in providing an improved in-store experience.

The post Creating in-store solutions for India’s new-age shoppers first appeared on PHYGITAL RETAIL CONVENTION (PRC).

Therefore, it is very important from a retailer’s perspective to become responsive in nature by being efficient and able to do repeated work better. Adding more to it, they must be able to react to the signals that you receive during the process and eventually reduce the lead time as well. Currently, to get more responsive is another assessment, that big players (mostly retailers) are facing. The data visibility concern is always there, and no one wants to highlight this situation.

Usage of tools like WhatsApp is a convenient option, as they are user-friendly and also cost effective. Also, providing continuous training to tackle and get used to technology advancements within the organization should also be done on a regular basis.

Most of the big ERPs just throw the bulk of data but it makes it difficult for the retailers to make it actionable. In an organization, where cost and investment are a constraint, one must figure this out in a user-friendly manner.

For organized retail, the key tool is to assess the demand in the totality as well as with transparency to transfer the information in a prospective manner. What retailers did earlier was to provide the availability of the information in both downstream and upstream ways. COVID has made us realize to look for different paths across the globe. To counter the challenges of the regulatory framework, manufacturing, logistics, production framework; one should work on ensuring the visibility of the information. This will become a key in streamlining the entire supply chain model.

The post Building A Responsive Supply Chain Model first appeared on PHYGITAL RETAIL CONVENTION (PRC).

According to the latest market intelligence research report by InsightAce Analytic, the global Artificial Intelligence (A.I.) in Beauty and Cosmetics market size was valued at US$ 2.70 Billion in 2021, and it is expected to reach US$ 13.34 Billion in 2030, record a promising CAGR of 19.7% from 2021 to 2030.

The beauty and cosmetic sector have witnessed a massive upsurge in Artificial Intelligence (A.I.) in recent years. Due to advancements in A.I. technologies and the fact that beauty is characterized as a personalized and engaging market that generates a large amount of data, A.I. appears to be a solution to deal with this complex environment, prompting beauty companies to make data-driven decisions on their strategies to remain competitive. The beauty market has changed dramatically over the last decade, owing to the introduction of new technology and a shift in customer shopping behaviours. The beauty sector has been incorporating digital transformation into its business models to give consumers individualized skin regimens and beauty products tailored to their specific needs.

The Artificial Intelligence (A.I.) In Beauty and Cosmetics Market, growth can be attributed to the Integration of advanced technology like A.I. in the beauty and cosmetic field, providing new ways of engaging with the consumer, bringing efficiency and customized solutions to the beauty client such as virtual try-on and personalized products. Increased demand for beauty products and technological advancements is expected to positively impact market growth. The outbreak of Covid-19 has changed consumer purchasing patterns across the beauty and cosmetic industry due to strict lockdown situations and the practice of social distancing across various countries. However, The COVID-19 crisis is likely to create opportunities for beauty and cosmetic brands due to the growing demand for personalized beauty & cosmetic products and the rapidly evolving e-commerce sector. According to a report, online sales at Sephora now account for 70-80% of total sales after the pandemic.

Prominent beauty assistance tools and magic mirrors are being tried all across the globe to reorient shoppers with beauty tools powered by AI that help them shop in a click based on their without the fear of buying mismatched cosmetics or beauty products!

The post AI adding the masterstroke to the beauty & cosmetics industry first appeared on PHYGITAL RETAIL CONVENTION (PRC).

It’s not about the new categories but how a proper distribution of weightage is given. Like, earlier malls who were not having hypermarkets/supermarkets can certainly now seek some new players which can fit in that space of the mall. There were few categories which have increased their operations and major contribution is done by athleisure and activewear. Sports and fitness brands Nike and Adidas have evolved more into the athleisure segment and for that they required slightly larger space. Brands such as Skechers expanded its area by 200%, Puma expanded its area by 300%. On the contrary, new brands like Miniso scaled down its area by 50%. Hypermarkets which were quite a trend earlier and were offering an area of 30,000-50,000 sq. ft needs to relook and reconsider their sizing as the concept of instant deliveries and big players like Amazon foraying into grocery sector is a big challenge for them.

Co-working spaces are finding their new home in the shopping centres. The mall developers are partnering with co-working companies as it also malls to boost their F&B, retail section. The co-working space is seen as a foreseen compliment and we’re bringing food courts along with that. Most malls are also planning to build office blocks, which will cover an area where employees can walk-in and work accordingly.

A shopping mall is an asset and mixing the categories in a right manner, maximizes the brand value of the asset. The mall developers need to determine the reality of the asset, size of asset and GLA and develop a retail strategy accordingly.

-Sandeep Kumar

The post Smart Occupancies: Categories Essential for Shopping Centres first appeared on PHYGITAL RETAIL CONVENTION (PRC).

The other segments that have reported strong growth on the brand website are Health & Pharmaceutical with 84.8% YoY growth and 67.7% YoY growth for FMCG in FY 22. The rising phenomena of D2C has helped the fashion segment to continue its growth despite being the most mature segment. Fashion & accessories have witnessed 89.5% YoY growth on brand websites in FY 2022, as opposed to a marketplace growth of 52.2%.

The market has changed now, and D2C brands will continue to be forced to stay hyper-focused on customer acquisition, in order to sustain and grow. With the advancements in technology, and changing consumer habits, companies need to drop the spray and pray approach and implement data-backed strategies effectively. Here are some ways that D2C brands can decrease CAC by utilising modern day technologies:

Lead Generation
The conversion rates depend highly on the response rate. With traction coming in from so many channels, it becomes hard for agents to connect with every lead individually, that’s where automation comes in. Chatbots and live messages can help engage with customers without any delays and give you more leeway.

Moreover, live chat solutions also enable multiple conversations at the same time. It is the perfect solution to offer personalisation without compromising on the speed or conversion rates.

Product Recommendations
AI has been an effective tool for various industries, and D2C can also use it for their own advantage. Technologies such as AI can help decipher data to anticipate customer behaviour and then make recommendations about the products and services, depending on their needs.

Big Data and CX
Similarly, data can also help build personalisation and enhance customer experience. Data analytics has various touch points such as customer preference, predicted spending etc. Big data can help reduce the guesswork and implement strategies that are more likely to bring in sales and conversions.

Sales Automation
Automation has been used by marketing departments all over the world, but there are barely any brands who automate their sales department. While complete automation of sales is still far fetched, some sales positions can be automated.

Improvements in AI have made it possible to reduce labor costs. If a brand implements this strategy, they can use the savings to enhance their business model and make it more robust and efficient. Getting more out of your existing staff can also help in reducing CAC and delivering better customer experiences.

Capitalise on Social Media
D2C brands are tech savvy but so are the customers. Now, instead of making a purchase blindly, consumers want to know more about the products, focus on the features, and then buy. There are customer engagement tools present now that brands should consider investing in. These tools use the social media channels and messaging apps to communicate with the potential buyers and help them find what they are looking for. Social media is a powerful tool not only for brand presence but also for increasing sales and engagement.

-Sandeep Kumar

The post D2C: The Buzz is Here to Stay first appeared on PHYGITAL RETAIL CONVENTION (PRC).