How Technology is Amplifying Footwear Biz Beyond Tier II

The footwear retail sector is highly unorganized, accounting for only 30 percent of all organized retailing.
How Technology is Amplifying Footwear Biz Beyond Tier II 

The Indian retail sector is substantially growing in the footwear segment as technology-driven outreach programs are helping brands increase their presence in smaller towns and areas that had remained unexplored until some time ago. Consumers everywhere are now more aware of Indian and international brands than ever before, and cashing in on this growing brand recognition, footwear companies are penetrating markets in tier-II and tier-III cities. If the technology works for metros, it would be for tier-II and tier-III cities. In the heightened consumerism that is being witnessed, footwear manufacturers feel the word ‘commoner’ is a misfit though cultivated choices remain in certain consumer niches.

Indian Footwear Market

According to Invest India's research, India, the world's second-largest consumer and manufacturer of footwear, is expected to grow eightfold by 2030. India is the world's second-biggest manufacturer of footwear and this provides an opportunity for export in the footwear space.

The footwear retail sector is highly unorganized, accounting for only 30 percent of all organized retailing. Exclusive Brand Outlets (EBO) of leading brands, as well as large format stores and other large multi-brand outlets, characterize organized retail. With an 11 percent market share, e-commerce platforms have quickly found a footing in the industry and are now driving the expansion of organized footwear retail. 

Consumer Behavior and Choices

In our constantly evolving digital times, customers irrespective of their socio-economic similarities or disparities stand united in their own unique segments – the consumers.  As a result, footwear companies, empowered by the increased availability of data, have consciously shifted from mass targeting to micro-segmentation.  The consumers’ demand for personalized interaction with the seller is increasing by the day. How often have we shopped online to discover that the retailers already know our behavior as consumers? We are constantly informed of the products we purchase, our buying behavior, the timings the purchases were made, the context of purchases, and through which channels we made those purchases. And the best part of the entire process is that a consumer is pleasantly surprised to find that ‘someone’ is talking to him or her through the entire journey at ground-zero or in virtual shopping.  

Challenges Faced by Traditional Stores 

The biggest difficulty that Indian retail stores face is the availability, feasibility, and adoption of technology as it is implemented in the day-to-day operations of retail outlets such as billing and payments, shrinkage prevention, stock inventory management, and supply chain management. Despite the increasing scope of technology, there are a few challenges faced by traditional stores:

●    Product Accessibility 
●    Latest  Products and Trends 
●    Products Availability – Appropriate Time and Supply
●    Operational Efficiency – Rentals, salaries, and overheads are all on the rise.
●    Obsolescence - Fast Fashion Industry – Out of Fashion Products = Lost Inventory

The retail market is evolving and is undergoing a rapid transformation propelled by several factors. Technology has the potential for a complete revamp of value capture in physical stores. Future stores must be a destination format that is fully integrated with the consumer's digital journey, from awareness building to searching/comparing options to provoking purchase to loyalty - all of which is convenient and seamless which is made possible by automation, analytics, and digital technologies. 

With the advancement in technology, even hardcore brick-and-mortar businesses are going the Artificial Intelligence way in non-metro cities as ‘adapt-or-die’ is the new fundamental. In fact, the footwear companies are deploying the latest technologies at the back-end to help enhance the AI experience for consumers.
 

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