The finding is part of a report by KPMG and Retailers’ Association of India
Amid pandemic, retailers should, however, shift focus to in-store safety, converting existing businesses to delivery-oriented ones, says the report
New Delhi: The post-pandemic world will see drastic shifts in buying habits with increased adoption of online shopping, contactless payments, and consumers placing safety over price, range, convenience, a report by KPMG and Retailers’ Association of India (RAI) said on Monday. KPMG and RAI expect shoppers to return to physical stores over the next few months as India hits peak festive season. Retailers should, however, shift focus to in-store safety, converting existing businesses to delivery-oriented ones, apart from tying up with delivery and logistics service providers in order to provide direct-to-home services, the report said.
Going forward, entertainment, physical shopping, dining out could see a surge in demand with gradual opening up of physical marketplaces—especially during the festival season, KPMG-RAI report said.
Harsha Razdan, partner and head, consumer markets and Internet Business, KPMG in India, said after over six months of not shopping, shoppers could be lured back to stores. “If you compare things with respect to June, everything will go up between September and December. There will be movement, except in case of cinema halls which are still waiting to be open. But some categories will see an uptick -- it's almost like the case of revenge shopping which we heard of in China," said Razdan.
But this could benefit only a few categories such as durables and apparel. However, it might not be at par with sales of the last festive season. "We don't know if sales will reach last year's levels but it will be much better than March to August, for sure," Razdan said, adding that the demand will taper off again in January till the vaccine comes, and the job situation improves.
“Consumers will look for deals as long as it's in a safe working environment. There would be pent-up demand. But categories like hotels, cinema halls, the restaurants won't pick up at that pace," he added.
In a recent survey by the Retailers’ Association of India, Kumar Rajagopalan, CEO, RAI, said that an assurance of no localized lockdowns will help fast-track recovery of sales during the upcoming festive season to almost the same levels as last year or perhaps just 20% short of last year’s figures.
“Shopping habits have been largely affected during the pandemic, with safety now taking over as a new criterion over price range, variety and convenience. In India, hypermarkets are witnessing lower footfalls, and most sectors including apparel, accessories and durables have faced a lack of demand," the report said.
This has prompted pure play offline retailers to expand their direct to consumer reach, by upping investments online and expanding omni-channel reach.
“We also expect consumers to continue buying via e-commerce rather than in physical stores. Retailers then should be in the position to adapt and make strategic collaborations in order to leverage mutually beneficial situations. Focus should shift on converting existing businesses to delivery-oriented ones, with utmost care for safety precautions," the report said.
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