Executive Summary

The retail industry is playing vital role in the economic growth of the country. The concept of
shopping is moving in and around hypermarkets, supermarkets, and specialty stores and in
other formats. The retailing industry has been present in our country through history and is
considered as one of the largest sectors in the Indian economy, contributing to around 14% to
the GDP, and employing around 7% of the total population. For decades, retailing in India has
been highly fragmented, i.e., unorganized, due to the presence of huge number of small mom-
n-pop stores.

The Indian retail industry is undergoing a paradigm shift and `Next Generation Retailing' has
evolved with new standards and benchmarks set for the sector, with higher and sophisticated
technology at one end and increasing customer focus on the other.

In retail, innovation is the name of the game. Innovation comes in many forms. Be it the
attractive presence of e-retailers to carefully strategized shop floors, the primary aim of the
innovation is to identify the consumer buying behaviour and roll out products that connect
with it. A large young working population with median age of 24 years, nuclear families in
urban areas, along with increasing workingwomen population and emerging opportunities in
the services sector are the key factors in the growth of the Retail sector in India.
With e-retailing giving a tough competition to the brick-and-mortar stores and more retailing
brands undergoing a change in their strategies towards consumers and their employees both,
the time call for nothing less than an overhaul. At the core of the competition, we identified
certain disruptions that are responsible for the tough competition among retailers. Here
changing the marketing strategy to retain the consumer takes the topmost priority. And
strategies are best developed by employees who are satisfied and well-motivated at their jobs.
After highlighting and analysing certain problems we boiled down to certain
recommendations that would not only result in a successful marketing strategy but also allow
the organisation to sustain with the help of satisfied employees.
INTRODUCTION
The India Retail Industry is the largest among all the industries, accounting for over 10 per
cent of the countrys GDP and around 8 per cent of the employment. The Retail Industry in
India has come forth as one of the most dynamic and fast paced industries with several
players entering the market. But all of them have not yet tasted success because of the heavy
initial investments that are required to break even with other companies and compete with
them. The India Retail Industry is gradually inching its way towards becoming the next boom
industry.

The total concept and idea of shopping has undergone an attention drawing change in terms
of format and consumer buying behaviour, ushering in a revolution in shopping in India.
Modern retailing has entered into the Retail market in India as is observed in the form of
bustling shopping centres, multi-storied malls and the huge complexes that offer shopping,
entertainment and food all under one roof.

A large young working population with median age of 24 years, nuclear families in urban
areas, along with increasing workingwomen population and emerging opportunities in the
services sector are going to be the key factors in the growth of the organized Retail sector in
India. The growth pattern in organized retailing and in the consumption made by the Indian
population will follow a rising graph helping the newer businessmen to enter the India Retail
Industry.

In India the vast middle class and its almost untapped retail industry are the key attractive
forces for global retail giants wanting to enter into newer markets, which in turn will help the
India Retail Industry to grow faster. Indian retail is expected to grow 25 per cent annually.
Modern retail in India could be worth US$ 175-200 billion by 2016. The Food Retail Industry
in India dominates the shopping basket. The Mobile phone Retail Industry in India is already
a US$ 16.7 billion business, growing at over 20 per cent per year. The future of the India
Retail Industry looks promising with the growing of the market, with the government policies
becoming more favourable and the emerging technologies facilitating operations.
India has seen the fastest growth in the retail e-commerce section among Asia-Pacific
countries, growing 133.8% in 2014 and 129.5% in 2015. E-commerce sales in India are
expected to grow from $14 billion in 2015 to $55 billion in 2018, says a report by marketing
research firm eMarketer

Era of e-retailing in India

Indian emerging e-commerce sector is estimated to grow to $100 billion in revenues
according to latest Morgan Stanley report. To aid phenomenal growth in this space lot of
innovations in logistics and delivery model are emerging in India.

Flipkart Pickup Store: Flipkart has introduced a new delivery model where you can pick up
your delivery from an authorized collection centre. Flipkart hopes to resolve the issue
of non-delivery due to non-availability of customers at the delivery
address. Also it will be convenient to customers as they dont have to
worried they are available at the delivery address. Initially this service will
cater to 20 cities in India and will be further expanded. Flipkart now
services around 10000 of the 25000 pin codes in India. Company expects it to be a game
changer for expanding into Tier IV cities.
Drone Delivery: Flipkart is planning to use drones for delivering goods in rural areas. It will
help in saving a lot of time and human resources for delivering goods. Though civilian drones
are currently banned in India, DGCA is fast-tracking the issuing the guidelines for the use of
civilian drones. Amazon is planning to start a similar service in USA known as Amazon
Prime Air and is waiting for approval from U.S. Federal Aviation Administration.

Kirana Stores: Amazon India has launched express delivery service called KiranaNow in
Bangalore, under which they have tied with local mom-and pop stores to deliver your
everyday essentials from Amazon to your doorstep in 2-4 hours. Currently it is servicing 12
pincodes in Bangalore.

Crowd-Sourced Delivery Model: Crowd-sourced delivery model that will connect local
sellers and buyers with the help of voluntary delivery personnel, reducing delivery time. It
will help build a sound last mile delivery channel. Flipkart has tied up with Dabbawalas of
Mumbai for last mile delivery. Dabbawalas will initially collect Flipkart marketplace
shipments from the delivery hubs and deliver it to customers, while picking up lunch box.

Petrol Pump: Bharat Petroleum gained a foothold in online retail space by partnering with
Amazon. An agreement was inked between BPCLs ARB, Retail set up and Amazons ATSPL
for setting up Pick Up store initiative at select BPCL retail outlets. Online shoppers can
collect their packages at pick-up points at their nearest gas station under this agreement.

India Post :With 1,54,882 delivery post offices,India Post has an extensive network which can
be used by e-commerce companies for better coverage. E -commerce players like Amazon
and Snapdeal have already started pilot projects in collaboration with India Post .It is viewed
as a win-win situation for both parties.With India Post earning revenue and E-commerce sites
getting access to a big delivery network.

App-Only Strategy: Myntra adopted a disruptive strategy by going App-Only Model trying to
tap ever expanding smartphone market. Also it gains by reducing infrastructure cost related to
IT services. Customers will be benefited by a personalized experience. Flipkart is planning to
do the same from September 2015.

Analysis of the problem

With a tremendous growth of e-retail in India the brick and mortar stores face a major
threaten to put brick-and-mortar stores out of business. Here are some of the disruptions that
are not really helping the brick-and-mortar stores and why.

Disruption 1: The changing role of the store

If there was ever an institution that has proven historically powerful, long-lived and
adaptable,4 it is the store. As shopkeepers and shops have been around for centuries, its a
pretty safe bet, mobile apps or not, that stores will still be around in very familiar forms for at
least the next few decades. This years Total Retail survey data strongly backs that up.
When examining the reasons consumers shopping online just two reasons are exclusive for
online shops and not replicable by physical stores (I can shop 24/7 online and No need to
travel to a physical store). All other factors can be achieved by a physical store, as well.

On the other hand, the top three reasons for shopping in-store (see figure 3), depend on
factors that are often exclusive to physical stores (Im able to see, touch and try
merchandise, To get the product immediately, and Im more certain about fit/suitability
of the product). These factors generally cannot be achieved by online shops, although that
could be changing if start-ups like the Russian fashion retailer Lamoda find success co-opting
some of the advantages of the physical store. Lamoda delivers to customers homes, then
allows them 15 minutes to try on their choices. Shoppers pay only for what they want to
keep, and the rest is promptly taken back to the store or warehouse.

But yes, although stores will flourish for few more decades, there are some factors which will
attract consumers towards online shopping. Wide variety of products, lower prices/ better
deals than in-store, 24/7 shopping, no travelling, easy mechanisms to compare products,
product detail information and customer feedback are some features which will push online
shopping.

One major challenge of the physical store is that technologically enabled and empowered
consumers simply dont need to browse as much at the store. That loss of foot traffic means
fewer opportunities for impulse buys.

Disruption 2: Mobile and related technology

According to a 2014 report from the Pew Research Center, parts of the developing world are
quickly reachingor, in the case of China, have surpassedUS rates of mobile-phone
adoption. Smart phones and laptops are used by everyone now days so the access to online
shopping is very easy. Also the digital media and social media play a very important role in
this aspect. Also location-based offers and coupons lure customers. Digital or virtual
currencies such as Bitcoin could enable users to pay for products and services electronically
without using local currency. Its not as easy to transact on a phone yet, but the advances that
are being made with one touch shopping are going to make the world of difference for a
retailer. Social media platforms are ideally suited for creating or supporting a brand, as they
provide the space to generate genuine word-of-mouth and viral buzz. Digital and display ads,
on the other hand, reinforce consumer interest. Another approach would be to try to invest in
brand equity to increase direct traffic, in which consumers go straight to a retailers online
assets instead of searching for generic products via a search engine.

Disruption 3: The proliferation of social networks

The ubiquity of social mediain individuals interactions with family and friends, as well as
in politics, journalism, and marketinghas for some time led many to assume that social
media platforms must be highly robust vehicles for shopping, or at least for communication
between retailers and consumers.

Disruption 4: Demographic shifts

The median age of almost all societies around the world is rising rapidly. Indian digital
natives ages 18-27- interacted with retailers via social media at a rate far more than our
global average. Tier I and tier II cities residents are also using online shopping facilities
because of wide variety of stuffs at their exposure.

Lack of Brand Counter Story

Stories add to the humanity of brands. They help consumers think through and act upon a
narrative that is fundamentally rooted in human truths. Stories generate empathy. We see
ourselves in the tale. Or we see a side of ourselves. Or we see the me that we would like to
be. Without that narrative, everything is dominated by features, data and discounts.

Consumers compare offers and in so doing they inevitably compare stories. They look for
how brands fit the story of their life that they are telling themselves. Sadly, the stories that
brands tell often focus on the world as they see it. They are a narrative shaped around their
history and their vision for the days ahead, and they take their reference from the thinking
and planning that have taken place internally. For example Levi Strauss & Co. have an
amazing brand story that buyers connect with Anyone can make a pair of blue jeans, but
Levi Strauss & Co. made the first blue jean in 1873. And we draw upon our heritage to
continually reinvent the blue jean for generation after generation.

Role of employees

Titan has a wonderful working environment where leaders can be found everywhere. This
is possible when there is empowerment of people to lead even when they lack formal
authority. The employees can be empowered only when they are involved in annual business
plan & five year strategy. In India few organisations have such a philosophy and most of the
decisions are driven by top management which often stifles the innovation that may
otherwise come from employees at all levels.

RECOMMENDATIONS
Building Private Brands

According to a report published by consulting firm Deloitte, consumers perceptions and

attitudes toward private label brands are changing significantly; and offers insight into the
notion that spending less for private label brands doesnt mean consumers are settling for less
from private label brands.

1. Tap the opinion leaders- Shoppers stop should tap the Opinion leaders in metro cities
by preparing a plan to influence them about the current fashion. Blogging aimed at
buying the private label brands rather than expensive national brands. Blogging is an
efficient ways because it targets the opinion leaders (mostly metro city consumers).
Word-of-mouth by the opinion leader influences the second person by giving their
opinion on a product. Further the receiver is the person who accepts the knowledge
from the opinion leader. The opinion leaders can give both advice and proper
information when they tell the adult decision-maker; they can purchase a product that
has higher quality.
 2. Tell your brand story. Human-to-human connections are the heart and soul of
business. At the end of the day we are dealing with people. Good writing and content
strategy makes branding of products, and the marketing of those products, much
better
3. Own an idea Just like Dove owns and serves the idea of real beauty, Shoppers Stop
should focus the on the idea of Art of Dressing
4. Using the Indianness to advantage The ethnic section of clothing as well as certain
make-ups and perfumes that are a part of Indian legacy can be reinforced.
Creating Great Places to work
1. Hiring the right fit - Driven by recruiting philosophies like "hire for attitude, train for
skill" hiring strategies that deems an employee culturally aligned towards the
organisations core values can be used. Personality tests are a good indicator of traits
of a person.
2. Rewarding Environment- Recognising employees is not sufficient. Recognising fast is
the key. Shopper stop should set a sales benchmark and should recognise the
employees within 48 hours via e-mail or sms.

3. Healthcare and other benefits - With a strong focus on employees health and overall
well-being, lifestyle assessment checks, dental/medical/eye check ups, life-skill
workshops, stress management through yoga, meditation, pranic healing, check-up
camps, physiotherapy should be undertaken.

4. Initiatives for women - Besides a well defined Anti sexual harassment policy
which ensures safety and equal rights for women, other initiatives like self defense
workshops, Tai chi, distribution of pepper sprays, sessions with women police officers
and NGOs to create awareness about women safety and rights shold be organised

Creating disruption in the current market scenario and digitally make its online
presence stronger?

1 Shopper Stop Company Culture: Company core values can help customers connect
with a brand. Shopper Stop can adopt the practice of Zappos which has not been
adopted by any Indian e-retailer. Specifying each company value of every page can
help understand the company in more better way.

2 Non-consumers can be great consumers: When Sony entered the consumer electronics
market in the 1950s, it didnt try to beat established tabletop radio providers by
introducing better products. Rather, it introduced its simple, portable and relatively
inexpensive transistor radios to teenagers who wanted to listen to baseball games or
music out of the earshot of disapproving parents. Sometimes, the best target
customers are those that lack the ability, wealth or skills to consume products.
Similarly, Shopper Stop can launch designer products at affordable prices for ties I
and II cities. Also, lucrative offers when launching products in newer markets can
attract new consumers. Also new offers like, some designer wear outfits and
accessories can be offered on rental basis. This will help in increasing consumer base
 because many people dont buy some products thinking it to be one time use. Such
facilities will increase demand and probably after liking the product from rental final
purchase chance can be increased.

3 Customer service: A friendly and humble customer service helps in retaining

customers. Executives should be helpful enough in providing suggestions to people.
Live chat facility should be available 24/7.

4 Online and luxury space: The Indian luxury consumer landscape is experiencing
strong undercurrents that are redefining the consumer profile and the way luxury
players operate. Several luxury brands like Porsche, Ducati and Canali are increasing
their presence in malls and online shopping. TO increase the demand of such brands,
Shopper Stop can have a comparative analysis how these products are better than
other. The quality and why these products are worth the prices charged.

5 Private label brands: The trend of private labelling is fast catching up among the
Indian retailers as it poses win-win solution for retailers and consumers in the current
retail environment. Many retailers are now forced to innovate and build categories
(private labels) across various points to attract more buyers. Shopper stop should have
state-wise clothing and other products option also. Traditional clothing varies across
religion and communities. Lehanga choli for Gujaratis, Punjabis traditional suits,
different kinds of sarees for north Indians and South Indians.

6 Face recognition apps and friend advice options: There can be app which will
recognize you like PayPal has. On basis of that some designs can be recommended to
the customers by designers. Also friends can recommend whether a particular item
suits us or not. Also virtual dressing room can be introduced.

7 Virtual designing: For home ware items, a 3D virtual design platform can be available
which will help consumers in deciding which colour curtains or bed-sheet will suit
their houses. They can create an outline by changing the colours and this will help in
choosing best design for their home.

8 Big data usage: Shopper Stop can make use of Big data for predictive analysis and
finding customer tastes and preferences and accordingly make recommendations to
consumers. This will help consumers and thereby increase customer base.

9 Changing patterns: Retailers are introducing different ways to increase footfalls in

their outlets apart from offering regular services. They have taken a step ahead to
make customers feel at-ease and spend more time in the outlet. The element of
innovation is being brought in with activities being undertaken in stores as well as
with the products.

10 Activity oriented: We all witness various activities that are introduced by retailers to
engage a customer to spend more number of hours in an outlet. Manzoni, the house of
Raymond introduced an innovation in luxury shopping - Midnight Shopping in
 Mumbai. This launch came as part of Manzonis first anniversary celebrations of its
Linking Road boutique. Commenting on the same Shreyas Joshi, President
Raymond Apparel Limited said, Midnight Shopping is a benefit offered to our
Manzoni customers across India, whereby they can seek to shop at any of the
Manzoni boutiques till midnight, and our facility will be available to service them at
their convenience. This service is currently being offered on request. Besides unique
product offerings, Manzoni also offers a unique service proposition for its customers.
Any new range or collection from Manzoni is showcased for customers, at the
comfort of their homes, on request. Such service offerings are in line with our focus
of providing our customers with high quality products with superior designs and
international styling; with service excellence.

Product allied: Not just activities but innovation has reached products also. People today take
pride in owning exclusive products and something that is not owned by anyone else. Brands
have diverted their attention to this aspect and are working around it. Myntra.com offers
some of the most well known pen brands in the world like Sheaffer, Cross, Waterman and
Oliver personified with the name of the customer. Mukesh Bansal, CEO, Myntra said, Pens
have been an all time favourite gifting item for their utility, badge value and their occasion
neutrality which makes them a relevant gift throughout the year and across all types of gifting
occasions. Myntra.com now elevates pens to a new level by offering some of the finest pen
brands in the world and offering these pens for personalisation. We are confident that these
differentiators will make Myntra.com the one stop shop for gifting of personalised premium
branded pens.