Omni-channel retailing is here to stay as shoppers turn brand-savvy

Taking some statistics first, let us consider multiple data points. According to Kantar IMRB, over 70 per cent of Indian consumers research online before making offline purchases. This is even as PWC India reports that over 40 per cent of consumers prefer a blend of online and offline shopping channels. A Harvard Business Review study shows that seamless omni-channel experiences can boost customer lifetime value by 20-25 per cent. The importance of omni-channel strategies, therefore, can hardly be over-emphasised.

Let us now consider some of the case studies or some Indian success stories for getting clarity on this syndrome. Some of the leading brands today exemplify the benefits of omni-channel retailing. Lenskart, for instance, achieved a 70 per cent conversion rate by combining online product discovery with offline try-ons and purchases. Fabindia, on its part, enhanced convenience by integrating online and offline inventories for customer-driven fulfillment. Not to be left behind, Nykaa created a cohesive brand experience through beauty advisors in physical stores, personalized online recommendations and click-and-collect options. It is pertinent to mention that what was earlier an optional strategy, omni-channel retailing has become essential as a shopping trend. It aims to provide a seamless shopping experience across all channels, including physical stores, mobile apps, and online platforms.

Although it first emerged in global markets like the United States, Canada, Europe, and China in 2010, India adopted it around 2017 with brands like Levi’s, United Colors of Benetton, and USPA leading the way in Delhi, Mumbai and Bengaluru. One must also remember that the Covid-19 pandemic transformed e-commerce into a primary shopping method for Indians.

Initially driven by deep discounts, e-commerce's appeal has endured even as these offers faded. By 2023, e-commerce comprised 7.1 per cent of India's total retail market, up from 4.7 per cent in 2019. It is expected to reach nearly 10 per cent by mid-2024. Significantly, in 2023, there was a 60 per cent increase in direct-to-consumer (D2C) brands expanding into offline spaces across major retail markets, up from nine to 11 cities. Brands are making stores more experiential, with a 59 per cent increase in average store size from 730 sq. ft. in 2022 to 1,160 sq. ft. in 2023.

Interestingly, however, despite the rise of e-commerce, physical stores remain crucial for building trust and enhancing brand image, especially for premium products. Pop-up stores and experiential centres play a vital role in engaging consumers and generating excitement. Analysing all such facts and multiple data points, a recent study by Anarock (Retail) suggests that harmonising online and offline channels is key to meeting modern consumer expectations.

Some essential strategies towards this are ensuring seamless inventory visibility across channels, implementing click-and-collect, buying online return in store (BORIS) and other omni-channel fulfillment options, staff being trained to be omni-channel champions, guiding customers seamlessly and leveraging data to personalise the experience across channels. More importantly, adopting omni-channel retailing allows brands to meet the demands of today's Indian consumers, offering convenience, diversity, and connectivity. This comprehensive approach promises to position brands to maximize their potential in the country’s dynamic retail market.