Visualising what lies in store for retail

The launch of Amazon Go and the proliferation of e-commerce start-ups point towards a terrain where artificial boundaries melt. These formats have influenced the way consumers shop

Our shopping habits have changed profoundly. E-commerce companies spend tonnes of money on enticing photography to get their products represented in the most attractive and compelling way to stimulate the customers’ impulse to purchase. A lot of us, who do not fear buying apparel or furniture online, risk getting a less than desirable and at times terrible misfit dress, shoes or even furniture.

Of course, one can always return the merchandise but many want to forget about it rather than sending the items back. One may even make peace with the stuff he/she bought online. Besides, there is also the convenience and comfort of buying things with a click of a button. These are some obvious, unavoidable shortcomings of online shopping.

But before the advent of e-commerce sites and not so long ago, the last decade was the era of the mall culture, as one sociologist calls them “Cathedrals of consumption”. Booming consumer culture and growing middle class and income levels triggered the growth of the malls in cities and towns. Our time was spent leisurely walking on the gleaming marble floors, lit with artificial lights, loud pop music, distinct smell of department stores, artificial fragrances filling our nostrils, riding escalators, enjoying the cozy air-conditioned environment, circling around the foyers and fountains. Perhaps in between purchase a thing or two. Frankly, atmospherics mattered.

The mall-culture took a severe knock once the e-commerce trend caught on in the last few years. According to some statistics, more than 200 malls have already shut in the past decade alone and many more are struggling. Across the country, malls look emptier and purposeless as aggressive e-commerce players have managed to radically transform our shopping behaviour.

For once, it seemed, the culture of selling in the shop will eventually fade. The e-commerce heralded the era of ‘on-demand’ and ‘always-on’ retail therapy. In a way, e-commerce shopping robbed all the fun of aimlessly wasting Saturday or a Sunday, when you would do leisurely in-person shopping. The notion of shopping time also got swept in the wind completely. It became an alternate universe for 24x7 shopping.

Acquiring stuff became much easier than exchanging the unwanted ones, which is quite a drain on one’s time. Therefore, many of us at times feel guilty of acquiring a pile and now don’t know what to do with it. Technology and ease of buying by few clicks propelled the impulse buying behaviour in us. According to one industry estimate, India’s e-commerce industry’s sales rose by 40 per cent year-on-year during the five-day sale period ending September 2017, backed by huge deals and discounts offered by major e-commerce companies.

Hitherto, the retail industry, that largely remained unchanged in the last 100 years, except for supply chain management and efficiencies that were brought in, now was undergoing through a rude learning curve, adopting to this new wave of technology onslaught and changing consumption patterns.

In the hindsight, the prediction that the neighboring mom and pop stores will be a thing of the past and how brick and mortar retail will most certainly be gasping its last breath, have proven to be wrong for several fundamental reasons. No doubt, brick and mortar retail caught cold when e-commerce came.

E-commerce sneezed when m-commerce came about. In recent years, the buzz word going around was Omni-channel commerce that promised to marry offline, online shopping without friction. The journey has not been smooth so far and the retail industry is watching this with trepidation.

If anything, the e-commerce trend has only strengthened the case of co-existence and of h-commerce meaning a ‘hybrid’ commerce, than being entirely dominated by e-commerce players. If the recent news about the futuristic retail unveiled by Amazon Go is anything to go by, the o2o (offline to online and online to offline) appears to come a big full circle. The debate about who will survive largely seem to be a pointless debate.

The mom and pop stores aren’t going anywhere, the malls may struggle, but the A category malls will still draw crowds. E-commerce platforms are opening their brick and mortar stores and similarly, brick and mortar retail brands are pulling up their socks and investing in digital platforms and bolstering online presence. So, at the end, the consumer is the winner.

The retail industry wants to be omniscient, omnipresent — it wants to know our spending habits intimately. The future of  retail in the country is going to be shared between the traditional retail, which accounts for 90 per cent of commerce, modern retail, which has an eight per cent shareand e-commerce, which has two per cent of the market and growing rapidly.

The trends point uniquely towards a terrain where these artificial boundaries melt and all these formats come together to influence the consumers’ choice to shop anytime, anywhere and everywhere. Interestingly, first it was shopping across the counter, then the counter vanished and now, it is the store that has disappeared. Thanks to the futuristic retail unveiled by Amazon Go what is disappearing are the lines at the cash counters, the carts and cashers themselves.

Apparently, it is being done to enhance consumer experience. On the other hand, self-service offers companies a tempting opportunity to reduce spending on man power, often reducing the costs dramatically.

Some people worry that such human-free business model will come at a huge cost with millions of jobs at stake. The retail industry is one of the largest employer anywhere in the world. Technology driven consumer experience is something we need to wait and watch to see how it unfolds, as it can be complex for some, complicated for others and inconsistent many a times.

But what is certain is that we, as consumers, are always looking out for that human touch and connection. There are a lot of factors in the subconscious that play on our minds while making a purchasing decision. Buying decisions are swayed by interactions with the staff and it becomes detrimental in the overall customer experience.

The holy grail, some say for the retailers, is to achieve seamless marriage of their digital online stores and their physical stores —referred to variously as Omni channel or O2O (online to offline).

One must not forget, personalised interactions will always trump technology assisted processes. In this fast paced world, customers are reaching out to you at all hours in need of assistance, resources and advice. The last thing one wants to do on the aisle is gaze at the wall and talk to it.

(The writer is a communications and management professional with cross-sectoral experience)