A recent report highlights the continued dominance of offline sales in India's retail landscape, with a whopping 90% of retailers generating over half of their sales through brick-and-mortar stores.
This trend is particularly pronounced in key sectors such as FMCG & retail, food & beverages, and consumer durables & electronics.
The NeoGrowth Study report reveals that e-commerce has had the least impact on three sectors: consumer durables & electronics, food & beverage, and fashion & lifestyle. What's remarkable is that 82% of offline retailers have seen consistent or increased sales, with a mere 12% reporting a sales decline due to online marketplaces.
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The report identifies various reasons for the appeal of in-store shopping, including the ability to physically interact with products, ensuring product authenticity and quality (cited by 54% of respondents), loyalty to local stores, and a commitment to supporting small businesses (35% of Indian shoppers).
To adapt to changing times, MSME retailers have adopted strategies to drive in-store sales, such as offering discounts, providing doorstep delivery, and utilizing instant messaging apps for customer engagement. Notably, 43% of retailers offer discounts or combo deals to boost sales, while 34% provide free doorstep delivery. Approximately 60% of retailers have integrated digital payments for a seamless customer experience.
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Only 10% of Indian shoppers exclusively shop online, with online sales spiking during flash sales, favored by 35% of shoppers. In-store shopping remains popular due to its emphasis on quality, store familiarity, and support for local businesses. Over 70% of Indian shoppers value the family shopping experience, with peak foot traffic occurring during special occasions and festivals.
Online selling is still in its infancy among Indian retailers, with 46% indicating they are in the early stages of understanding online retail. Additionally, 16% struggle to find digitally adept staff for online selling platforms.
The study encompassed 3,000 Indian retailers and shoppers across 25+ cities and nine different industries.