New Delhi: Overall Indian retail market expected to double to $1 trillion by 2020 from $600 billion in 2015 following robust income growth, urbanisation and attitudinal shifts, says a report.
Modern or organised trade expected to grow 3 times to $180 billion by 2020 from $60 billion in 2015, said the report by management consulting firm BCG and Retailers Association of India.
'Brick and mortar is still 80-85% of the market—players need to focus on transforming this core to provide a better customer experience which may not be possible with online,' says BS Nagesh, Founder, TRRAIN.
E-commerce market in India is likely to quadruple to $60-70 billion over the next 5 years, driven by faster growth in goods than services.
Internet users expected to increase 3 times from 200 million in 2014 to 600 million by 2020 and number of smartphones will grom 120-140 million in 2014 to 600-700 million in 2020.
Lower cost of connectivity and improved quality and expanding reach in lower tier cities and rural areas will also contribute in the growth of E-commerce.
Efforts by players to develop payment channels (cash on delivery, mobile wallets) and streamlined logistics infrastructure will also aid e-commerce growth, the report said.
'The Indian consumer is on the digitization cycle—it is irreversible... it is causing habit changes which are undiscovered and will provide multiple opportunities to engage with,'says Ajay Kaul CEO, Jubilant.
Well conceptualized talent management strategy is critical to revitalize customer journey across channels and supply chain requires evolution as modern trade grows exponentially, the report said.
'The amalgamation of the virtual and real world is inevitable. Multi channel will co-exist with pure-play e-commerce with healthy tension between the two channels but overall very positive for the Indian consumer,' Shital Mehta,CEO, Pantaloons, said.