Indians are amongst the world’s most positive clan when it comes to job prospects and personal finances, according to Nielsen’s Global Online Consumer Confidence second quarter of 2011. Higher brand awareness, increase in disposable incomes, availability of wider options in markets, changing lifestyle and demographics are some of the major drivers, among others, that have propelled Indian consumer markets over the last decade. The progress can also be largely attributed to calculative liberalised policies implemented by the government that have not only encouraged foreign companies to foray into India, but have also taken care of domestic players and their growth.
Certain numbers that indicate elevation of lifestyles among Indians, that has driven consumerism directly or indirectly, are given below:
Indian retail business values at around US$ 550 billion as of now and about four per cent of it accounts for the organised sector. A report by Boston Consulting Group (BCG) has revealed that the country’s organised retail is estimated at US$ 28 billion with around 7 per cent penetration. It is projected to become a US$ 260 billion business over the next decade with around 21 per cent penetration.
Today, Indian retail industry is represented by glamorous and spacious malls. Organised retail, whose growth is marked by the entry of formats like departmental stores, hypermarkets, supermarkets, specialty stores and western-style malls, is changing the conventional shopping norms of the traditional unorganised outlets.
India has been ranked as the fourth most attractive nation for retail investment among 30 emerging markets by the US-based global management consulting firm, A T Kearney, in its Global Retail Development Index (GRDI) 2011.
Cumulative foreign direct investment (FDI) inflows in single-brand retail trading during April 2000 to August 2011 stood at US$ 44.45 million, according to the Department of Industrial Policy and Promotion (DIPP).
Certain developments and investments that took place on the Indian retail canvas recently are discussed below-
Fast moving consumer goods (FMCG) sector is scaling new heights due to the entry of foreign brands and development of organised retailing in a big way. Indian packaged food industry, which is currently estimated at around US$ 10 billion, is driving retail sales to a major extent in India. FMCG firms have also started tapping net savvy consumers to give a boost to their revenue. Companies, including Dabur, Himalaya Herbal Healthcare, Neutrogena, Oriflame, Amul, Future Group, Aditya Birla Retail, REI Agro and Carrefour are making efforts to expand their reach through internet.
A recent study has revealed that lesser developed eastern states such as Bihar, Orissa, Chhattisgarh and Assam are leading rural sales in India. The analysis has strengthened the fact that rural markets are driving consumption of FMCG products.