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Future Of Indian Consumer is Digital Brands

Description

We are going through some interesting times in India. Our GDP is expected to grow at 7.5% in 2017-18, which is remarkable considering the global GDP growth is at 3.5%.

The Indian middle class with a higher disposable income is expected to double by 2025 to $550 million with rising Internet penetration. There are over 450 million Internet users in the country today — only 28% Internet penetration. 80% of this Internet consumption is through mobile phones that have led to a digital revolution in the country. This revolution has touched all aspects of the lives of Indians: health care, fashion, banking, eating, drinking film tickets and finding a life partner.

In developed markets, leading global brands have realized the impact that digitally has on a brand. They adopted ‘Digital First’ strategies to help them grow. Companies such as spectacles-seller Warby Parker and fashion and beauty retailer ASOS started online first, built a robust brand, and then expanded to physical stores.
In Asia, after the success of the Chinese e-commerce sector, the next big market is India. One of the biggest industries to be impacted by this revolution here is retail. Digital has enabled people to shop by just tapping on their phones, without having to visit a physical store.

Indians from far-flung corners of the country now have access to the best of brands, which are delivered right to their doorstep. It has made companies realize that they need to reimagine the way they do business and engage customers. They need to go beyond traditional retail formats and television advertising to reach digitally savvy customers.

The Shop That Never Closes

With people, especially the ‘millennials’ and the latest ‘Generation Z’, consuming more than half the information around them digitally, the time is ripe for brands to leverage this opportunity and create consumer journeys online. This is particularly relevant for these consumers who share their consumption stories online.

Building brands in India used to be very difficult due to the fragmented nature of the market and lack of consumer data. In recent times, we have seen this change. Roadster, an outdoor lifestyle brand, is completely online and is now among the fastest-growing apparel brands in India. This was made possible by utilizing consumer data to meet consumer needs and by increasing the manufacturing capacity in ‘Mac in India’ rapidly using high-quality products.

The cost of communicating with customers, or selling a brand proposition through digital channels, is also dramatically lower in comparison to mainstream media such as television and print advertising.

Brands that create strong digital experiences continue to attract new customers and gain their loyalty, as evident by the number of digital touch points that continue to increase by 20% annually. More offline customers are shifting to online, and younger, more digital-oriented shoppers are joining the ranks of these consumers each year, as a McKinsey study confirms.

This key is now to create a strong brand on social platforms with coherent communication. Digital First brand is going to be the future of brand-building in India.These brands are quick to scale. The success is visible. The aforementioned Roadster is already a Rs 650 crore brand with 2.5 million customers within five years and counting.

Such brands have been successfully created through an effective story linking with the principles of effective brands, making them capable of registering more than 80% growth every year, which is far ahead of the establishment of traditional, old brands.

Tailor-Made Data

The key ingredients to building Digital First brands are:

1. Engaging Content

With approximately 400 hours of videos uploaded to YouTube every minute, 100 million hours of videos watched on Facebook every day and three million photos shared on Instagram every hour globally, it is very important for a brand to create a compelling story and a seamless digital experience to break the clutter. Content should be attractive, bite-sized and interactive so that consumers can communicate with the brand and provide suggestions and feedback for improvement.

2. Consumer Insights

Online brands should take advantage of data science to understand their consumers ‘deeply’: their priorities, spending and shopping patterns, geography, etc. This brand will help in the formulation of its products as per the needs of the customers and make the brand faster.

3. Leveraging Technology

Technology can truly disrupt the way fashion is accessed and consumed. For instance, an entire product lifecycle — right from predicting demand and trends, design, managing production, replenishment, and determining the most optimal pricing — can be done through artificial intelligence (AI). This helps reduce time to manufacture, and cuts down wastage in the system.

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