India was always on the forefront of digitalization. And digitalization acquired breakneck momentum as Indian Consumers adapted to the constraints imposed by the pandemic and embraced digital shopping in a big way. Rising D2C brands were able to leverage this changing consumer trend.

Besides digitalization, other strategies that worked to the advantage of these new challengers were: 

1. 1. Direct approach to customers
2. 2. Enhanced customer experience
3. 3. Personalised Brands
4. 4. Great shopping experience – anytime, anywhere and at any platform
5. 5. Marketing strategies like try before you buy (Wake fit), using social platforms, influencers, and real satisfied customers
6. 6. Easy return policies
7. 7. Usage of data to reach customers and personalise accordingly

Another mega trend working in favour of rising D2C brands is the slow return of normalcy and crowds thronging malls and multiplexes again. This has shifted the focus back to physical stores and in-store shopping in the D2C space. 

Post Covid, FMCG lost 25% of sales from poor retail execution given that, as per retail industry data 79% of Impulse buying occurs at physical store. 

FMCG has since recovered and has seen 30% sales increase till March 2023 and is expected to grow by another 20%. The value could be more if learnings from the experience of the emerging D2C stars are implemented to overcome challenges and drive growth in FMCG and Retail. Here are 3 keys to unlock Customer potential in the rapidly evolving retail and FMCG markets 

3 Key to Unlock Evolving Customer Potential

1. Data Analytics

The consumer audience in India is marked by bewildering variety. With penetration of digitalization in Tier 2 and Tier 3 cities, the variety has only increased. From Millennials to ageing population (The ageing population is supposed to grow by 41% by 2031), changing preferences (More health consciousness) and declining brand loyalty, it is very important to understand customers studying data and changing trends, and presenting the Customer with more personalised brands. This is something that new D2C brands have been successful in achieving with their deep and wide use of technology

2. Retail Execution Strategy 

The loss due to expired products in large format is estimated to be close to 20% of all products sold. There is limited storage space, seasonal variability, and product shelf life itself is a challenge. Using Data for a proper retail execution in terms of:

• right products at right time at right place, 
• merchandising, 
• order replenishment, 
• store audits and 
• proper promotional strategy 

can be accomplished by understanding consumer buying preferences and behaviour. 

Investing in helping both FMCG and Retail sales teams to understand and internalise the concepts of ROI per square foot and effective shelf utilisation is extremely important. 

Products may be returned due to expiry, but retail must realise that it is a loss for them too, if the product is occupying space and not moving. How they can join hands with FMCG to minimise this loss through a win-win approach for both, could be critical. Data Driven Strategy execution will help them stay relevant and gain an increasing share in a constantly changing market

3. Enhanced Customer Experience

Easy availability of goods, seamless shopping and instore personal salesmanship to keep the Customer satisfied and happy, enhances Customer experience. Improving instore customer ambience, offering personalised services and value-added Customer support contribute to a highly satisfying shopping experience. This often makes shoppers more receptive to buying suggestions resulting in a bigger share of impulse/spontaneous purchases

To wrap up, Retail and FMCG will both benefit by adapting and leveraging data, prioritizing Customer experience, staying in tune with changing Customer behaviour and expectations. Innovation, can longer be restricted to just the products. Innovation must now encompass every stage of the shopper journey to deliver a highly personalised experience. That could the quickest path to fostering stronger brand loyalty, in the days to come