Boston Consulting Group (BCG) and the Retailers Association of India (RAI) today unveiled their joint report, “Winning Codes for Retail 2035: Capturing the ₹200 Trillion Prize”, at the Retail Leadership Summit 2026. The report highlights India’s consumption-led growth momentum, the rapidly evolving consumer journey, and the strategic imperatives for retailers seeking sustained competitive advantage. India continues to rank among the fastest-growing major economies globally and is projected to become the world’s third-largest economy by 2030. The Indian retail market is expected to expand to ₹200 trillion over the next decade.

The findings underscore the increasingly complex and context-driven nature of consumer decision-making, alongside the growing influence of technology, especially artificial intelligence, in shaping every stage of the shopper journey. The report calls on retailers to reassess traditional assumptions, deliver sharply differentiated value propositions, and embrace AI as a catalyst to fundamentally redesign the retail organisation.

“India’s retail story is an inspiring story. The sector is poised to expand into a nearly ₹200 trillion opportunity over the next decade. More importantly, both the offline and online operating cash flows are showing clear and sharp improvement. The winners of the future will have a sharp differentiated value proposition, at scale use of AI and technology and excellent execution”, said Abheek Singhi of Managing Director & Senior Partner of BCG.

Key Findings of the Report

Retail in India remains an exciting opportunity

• India continues to outperform major global economies, with GDP growth of 8% in 2025, and remains on track to become the world’s third-largest economy by 2030.
• Private consumption remains a key driver of this momentum, led by discretionary and services spending. Together, these forces are expected to expand the Indian retail market to nearly ₹200 trillion over the next decade.
• Organized retail has historically outpaced underlying category growth. However, this gap has recently narrowed, particularly in offline channels, signalling the need for sharper differentiation and operating model evolution.

“India’s retail industry enters 2026 with three parallel realities: demand remains resilient, consumers are becoming more discerning, and retailers are innovating,” said Kumar Rajagopalan, CEO of Retailers Association of India (RAI). “The next decade’s ₹200 trillion opportunity will not be captured by sales growth alone. It will be captured by retailers that make explicit business model choices, embed AI across the shopper journey, leverage AI to power agent-led functions, and rebuild talent and operating models with sustained operational excellence. The winners of the next decade will be those who treat transformation as a discipline rather than a project, and who build trust by delivering consistently across formats, channels, and price points.”

Winning codes for retailers in the next phase of retail

Target focus segments with sharp trade-offs to deliver on CVP profitably

• Winning retailers anchor their strategy and business decisions around a clearly defined target cohort
• Explicit trade-offs and disciplined execution are critical to delivering a differentiated customer value proposition and sustaining profitable growth.

Re-think marketing & shopping experiences to cater to evolving shopper journeys

• Agentic commerce has moved from experimentation to reality, with GenAI increasingly influencing research and purchase decisions. Nearly 42% of urban US consumers have already used GenAI. 
• In line with India’s strong digital adoption trajectory, AI adoption across the shopping journey is expected to accelerate in urban India, led by Gen Z consumers.

Drive end-to-end AI-led functional transformation and capability reset

• AI is transforming core retail functions, delivering meaningful improvements in speed, quality, and cost.
• A functional transformation approach can unlock gains of 40 to 60%, compared with 10 to 15% typically achieved through isolated use-case deployments.

“Retail is entering a decisive new phase where AI is no longer a peripheral experiment but a core driver of competitive advantage. Agentic commerce is already influencing how consumers discover, evaluate, and purchase products globally. Given India’s strong digital adoption curve, we expect AI-led shopping journeys to accelerate rapidly in urban India, particularly among Gen Z consumers. The bigger opportunity, however, lies beyond front-end experiences. Retailers that adopt an end-to-end AI-led functional transformation approach—across merchandising, supply chain, marketing, and service can unlock 40–60% performance gains, far exceeding the incremental impact of isolated use cases. To win in India’s complex retail landscape, companies must make deliberate strategic choices: define clear focus segments, align decisions around a distinctive core value proposition, and embed AI across the shopper journey to drive personalization, improve conversion, and reimagine the overall shopping experience,” added Bharat Mimani, Managing Director & Partner of BCG.

Imperatives for retailers

To succeed in India’s complex retail landscape, retailers must:

• Define clear focus segments, make deliberate trade-offs, and align business decisions to deliver a distinct core value proposition.
• Leverage AI across the shopper journey to enhance personalization, improve conversion, and reimagine marketing and shopping experiences.
• Drive an end-to-end, function-led AI transformation across the organization to unlock sustained value creation