Digital transformation is successfully transcending physical and digital channels as brand owners and retailers continue to invest in digital mediums to grow the reach of their products and sell more. The Indian e-commerce industry has seen tremendous growth, according to an industry study by IBEF, and is projected to overtake the US’ e-commerce industry to become the world's second-largest e-commerce market by 2034. Offering a huge opportunity for retailers, the industry is characterized by rapid transformation in terms of product innovations, new channels, and augmentation in emerging technologies.
Here are a few e-commerce trends that brand owners and retailers follow to bridge the gap between how they sell today and what their customers expect in the digital economy.
The Rise in Hyperlocal Commerce
Although books spurred the initial momentum of e-commerce, fashion/apparel, and electronics follow the next phase of growth, especially in emerging economies of India and the Middle East. Hyperlocal SKUs such as grocery, personal care, beauty services, food, and FMCG products will drive this development. And rightly so because of several factors mainly linked to trust reasons, Asian customers tend to shop at their local neighborhood stores.
Emergence of Kiranas
Kirana stores have long been an integral part of the retail fabric in India, currently accounting for almost 90% of FMCG sales. The rise of digitization in the Kirana world has worked as a catalyst that enabled the integration of digital technologies in the pursuit of ever-growing profit margins. Digital innovations like cloud technology, Snapbizz ‘Smart’ billing solutions, POS systems, and wholesaler apps allow them to replenish faster, enhance store efficiency, and attract new customers by upgrading the shopping experience.
The small retailers who are traditionally operating on a ‘store-only’ model, have now adopted digital technologies and applications like ‘google sheets’ to maintain stocks, mobile apps of wholesalers to place orders, etc. Some Kirana stores have also quickly transformed into fulfillment centers for e-grocery portals to keep the business going and furnish demands arising out of the neighbourhood.
With the high penetration of mobile phones in India, mobile trade or mCommerce is going to be a major extension of e-Commerce with the potential to outstrip its parent, in terms of revenue, contribution rates, and conversions.
The Advent of Artificial Intelligence (AI) and Machine Learning (ML)
One thing that has helped e-commerce giants like Amazon in gaining a competitive advantage over other e-Commerce firms is their ability to use AI and other cutting-edge technologies to develop and expand all facets of their market. By using ‘Natural Language Processing’ to drive Alexa and leverage collaborative filtering to customize suggestions, and optimizing its logistics by predictive rerouting, Amazon has continued to extend AI and ML use cases.
Although many firms not just in e-commerce already have automated systems in place, troubleshooting is typically left to actual employees. Flipkart is applying artificial intelligence-based deep learning and Machine Learning models to resolve last-mile delivery issues, which helps to save time and resources at different stages of order management. As AI provides fast, accurate, and much-needed clarity to avoid logistical failures and save costs, with this, Flipkart manages customer expectations and trust levels by ensuring reliability.
In India, new digital reality comprises platforms that don't bind just a section but offer diversities in languages. People are more inclined to use apps and digital infrastructure that support their regional language and voice-based queries, which make them highly accessible. Even retail giants like Reliance Retail has also started taking orders on WhatsApp for the convenience of their customers, during the lockdown period.
Social Commerce to become key revenue channel
Over the last few years, social trade has steadily gained traction, and 2020 is predicted to be its 'flywheel' moment. It's a perfect way for brands to reach more consumers at a lower cost, in addition to simplifying the buying journey. This is expected to become the third big distribution channel in the coming years, taking its place alongside e-commerce and conventional retail.
To ensure goods can be sold through conventional retailers and digital platforms, including online marketplaces, accurate identification of products is important. GTINs (unique product coding standard) enables brand owners to identify products and sell online.