Moving forward where do you see maximum retail spends happening?

As we move ahead, we will see outcomes at different levels - short-term, mid-term and long-term. In the short-term, we are already seeing huge pressures on cash flows. This, in turn, will lead to a squeeze on capital expenditure, marketing budgets, and any spending that is beyond the core product aspect. So I see a lot of curbing in these areas. But this will also give rise to a lot of frugal and innovative thinking with lesser resources. There will also be a lot of emphasis on digital, as has already become evident, with retailers extending their selling processes and avenues into the digital space, whether directly or through collaborations.

Of course, these changes will be tough for many physical retailers because they require a cultural shift and a shift in the way they think and process them. Also, consumption patterns and trends have been changing and will continue to change. This will reflect in the way retail presents itself. So experience is going to be a very strong factor. By experience, I don’t just mean retail design, but the overall experience of the brand, the products, systems and services and all of them being integrated. And there will be an increased focus on the notions of brand value, quality, honesty and authenticity to keep the customer loyalty in tact. 

So what does all this mean for the eco-system surrounding retail, namely the retail solution providers (RSPs)? Any quick tips on how they can realign their business model to adapt to the new retail investments?

One of the biggest lessons for RSPs now would be to re-look at the processes, so that they are in sync with what’s happening. This means getting ready for multiple scenarios in the future, however unpredictable and impractical they may seem. Unforeseen adverse circumstances are increasingly becoming common. So given this, how do small or medium-scale solution providers keep themselves nimble enough to adapt to the new circumstances? That is the question. Also, they need to be careful about cash reserves and create renewed agility in their processes, while being open to collaborations.

Most importantly, they will have to look at the retailer fraternity with more empathy and see how well they can integrate their solutions to address the retailer’s problems. So I think collaborations, agility and empathy and providing unique solutions to problems could be the way forward. I would stress less on capital expenditure, or on creating investments under one roof or creating a single point control, because uncertainty is going to be the way of things as we move ahead.     .  

Speaking of solution to problems brings us to technology. What do you think can be the best approach now when it comes to investing in the right tech solutions in retail?

Technology is going to be ubiquitous to all businesses, whether in back-end or front-end. But it is impossible for one company or service provider to do everything.  Customers on the other hand are looking for a more wholesome solution. They are not looking for parts, but for a sum of parts. Thus it is important that the solution provider wears a cap of integrated solutions rather than one of transactional one-off solution.

Most of the time, a solution that is already available and used across the world is replicated, adapted to the Indian context and offered at a lower price. Or else, a solution is offered based on the brief from the retailer. But in a situation like now, when cash flow issue has hit everybody due to the pandemic, it’s important that everybody explores unique solutions to problems. 

Given the above, how do you think retail technology solution providers can offer best value to their retail clients? Also, do you expect to see greater collaborations between technology solution providers and retail solution providers/ store designers?

Integrating more technologies into the physical or digital platform or both requires a strategic shift and that shift is actually a paradigm shift for the concerned solution provider. The nature of technology is such that the investment has to be constantly renewed, refreshed and re-targeted. Technology also has the advantage of becoming more accessible with time. So I think the smart thing for the solution provider to do is to collaborate in terms of looking beyond just digital, or just physical, and integrating the two. Most technology solution providers today are young start-ups and most physical solution providers have a good base, so it could be a good marriage of sorts wherein they can look at offering an integrated creative solution to a retailer’s problem, one that goes beyond the buying and selling aspect. This is because ultimately we are looking at a circular kind of shaping up. So new methods have to be proposed and experimented with on a smaller level. And then, if successful, they can be scaled up.

Finally, what do you think would be the crucial differentiating factors for brick and mortar retail to succeed in a post-Covid world?

I think there could be multiple scenarios - 1. Store size would need to be looked at more smartly; so bigger need not be grander or more profitable. This also means that solution providers would have to look at how to provide more in the same space, which would enable more attraction and transaction. 2. The retailer would move into the digital space, so the solution providers would have to look at integrating their solutions smartly, not for their glitz, but for their value. 3. Experience is going to be the key factor, while keeping control over the high cost of investments. So how a designer or a solution provider can provide an integrated experience across all platforms - right from a product to its deliverance to its consumption and finally to its feedback and keeping the cycle going - is going to be the key. The experience might be something completely out of the box, wherein you simply wow the consumer and make the experience memorable or it could be the speed, the monitory value, or it could be through the service. So there are various parameters of experience and obviously, it can also be an integrated one, delivered as a full pack. So experience design is going to possibly matter a lot, irrespective of the volumes of spends.

“One of the biggest lessons for RSPs now would be to re-look at the processes, so that they are in sync with what’s happening. Also, they need to be careful about cash reserves and create renewed agility in their processes, while being open to collaborations. So I would stress less on capital expenditure, or on creating investments under one roof or creating a single point control, because uncertainty is going to be the way of things as we move ahead.”.