Retail
Chronicles
Monthly Newsletter | Volume 6 | Issue 12 | January 2022
CONTENTS 03
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TOP RETAIL TRENDS IN 2021
WRITERS
The Retail trends of 2021 were explored at different points during the year, and we as onlookers saw the first-hand development of these trends throughout the year
Aayush Ghildiyal | Harsh Gupta | Akshita Kulshreshtha | Raghav Khandelwal |
NET ZERO RETAIL Net-zero is counteracting the green house emissions from companies by removing it. Any climate change from industrial activity needs offsetting for which a collective effort from the retail industry is needed to make a difference in protecting our Earth.
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Abhishek Jain | Hrishikant Mane | Mansi Vora | Ruttwick Bowlekar | Yash Bhojwani | Yuti Talati |
SENIOR DESIGN TEAM Nilesh Agarwal | Prachi Sharma | Prashant Sihag | Shivani Kunkolienkar | Sneha Patel |
EDITOR Riya Shah
RETAILING & METAVERSE States wonderful eye opening insights in the world of latest technology named metaverse and how it connects beautifully with the Retail World.
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JUNIOR DESIGN TEAM
RETAIL MARKET WORLDWIDE2021 2021 was a roller coaster ride for almost all segments, with many ups and downs due to the pandemic. After the first wave of Covid 19, when everything was getting on track, the second wave knocked down the door.
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PODCASTS
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TRIVIA QUIZ
TOP RETAIL TRENDS IN 2021
Akshita Kulshreshtha - MBA RM Retail Chronicles | Page 03
January, 2022
In the past two years, or for as long as the Covid-19 pandemic has hit the world, there are industries and businesses which have undergone humungous transformations. We saw financial institutions, IT organizations, educational institutions, and every other industry going online. There are many which are still online and their progress amidst the pandemic is noteworthy.
But there are several industries that couldn’t shift their entire focus to the online medium. manufacturing companies, public sector industries, and our very own retail industry. Abandoning the offline world and functioning remotely was not an option for such industries. Hence, the transformations that took place with these industries were something that the economists, world readers, and the business media kept their eye on. And it remains exciting and enlightening to see how the industry molds itself into the new world year after year. This is something that is continuous. Frame it better. Maybe something like, it remains exciting. Retail Chronicles | Page 04
As a result, in 2021, we saw a retail industry that was driven by technology, motivation, and strength. Let’s take a look at the top 8 trends of the industry in the year 2021.
1. OMNI-CHANNEL RETAIL– This has been by far the biggest and the most looked-upon trend in the industry in the year 2021. In order to provide customers with a safe and secure shopping experience, retailers started providing omnichannel services. E-Commerce boomed and services like ‘No contact Delivery’ and ‘Click to collect’ found their space in the industry. 2. SOCIAL COMMERCE– With the world coming online, Gen-Z inspired even the Gen-X and Gen-Y to be social media butterflies. Indians saw influencers who were the 90s and 2000s kids, and also influencers who were moms, dadis, and more. This allowed the retailers to approach all sorts of Social Media Influencers to narrate their journey with their products. Consumer journeys were hence shorter and more effective.
January, 2022
3. PERSONALIZATIONDRIVEN BY DATA SCIENCE – The big data boom that has happened in the last few years has impacted the world in a confounding way. The anticipated response to data science technology came up booming during the pandemic. The digital footprint of a person became their identity and the Retail industry leveraged this identity to boost their sales. 4. AUGMENTED REALITY– A survey conducted by Google showed that 66% of customers look forward to using AR during shopping. Whilst going to malls used to be an experience that people looked forward to every now and then, AR is another experience that is to be looked forward to in a post-pandemic world. There is another data from Shopify, that
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says that the sales boost up to 94% with the use of AR. 5. D2C– We were already familiar with terms like B2B and B2C. Off-late, we started hearing of this new term, D2C. Better prices, feasible margins, and the ability to have faster consumer preference turn-outs made retailers opt for D2C platforms to boost their sales. 6. AI FOCUSPersonalization may be enhanced even further using AI technology, which allows landing page copy and product descriptions to be changed in real-time based on consumer demands. By developing tailored shortcuts, AI can also help online shop navigation and reduce customer trips, for example, by presenting women's, unisex, or men's clothes first, based on the consumer's gender identification.
January, 2022
7. RE-COMMERCE– This term that has been coined recently, encompasses both online and offline sales of secondhand goods. In 2020, eBay released its inaugural Re-commerce Report, which polled over 4,000 customers and sellers in Germany, France, the United Kingdom, Canada, and the United States. According to the poll, 79 percent of German customers said they had purchased used goods on eBay in the previous year. Recommerce's sustainability, in addition to cheaper pricing, is a primary motivator of adoption. 8. SUSTAINABILITY – Much like re-commerce, sustainability was a major retail trend in 2021. According to a Box Inc poll, 46% of consumers feel that ecommerce is not a long-term shopping option. 73 percent say that online retail's high return rate makes it unsustainable, while 49 percent believe that transportation and shipping are incompatible with a sustainable approach. For online businesses, providing environmentally friendly shipping and sustainable packing solutions is becoming increasingly vital.
LOOKING AT THE FUTURE The Retail trends of 2021 were explored at different points during the year, and we as onlookers saw the first-hand development of these trends throughout the year. With the new year kicking in, it is to be seen what the Retail Industry holds in store for us for the year 2022. Some trends that can be looked forward to are cashier-less Shopping, autonomous delivery, and the boom of experiential retailing. Retail Chronicles | Page 06
January, 2022
NET ZERO RETAIL TRANSITION TO DECARBONISE OPERATIONS
Aayush Ghildiyal - MBA RM Retail Chronicles | Page 07
January, 2022
The Climate crisis is one of the world's biggest problems right now. While some people might choose to ignore it or overlook it for their own personal agendas and benefits, Retail has taken the responsibility to be one of the flagbearers of sustainable practices and goals. The ever-increasing demand and substantial development of retail outlets in densely populated urban areas make this noble endeavour challenging and grueling. A clear roadmap and strict timelines for these goals are essential; equally important is the support of governments and customers worldwide. Everyone needs to join hands and take responsibility to achieve net-zero retail.
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Investors, regulators, and consumers seek retailers' actions to decarbonise their operations. Retailers are looking at pragmatic ways to mitigate climate change risks. The most popular approach is setting scientific targets. The first thing is to properly understand what Net zero is and how it can be achieved. So, what is net-zero? Net-zero is a climate outcome where all greenhouse gas emissions from manmade sources are counteracted by removing these gases in equal amounts. This removal of gases prevents global temperature rise; hence the net effect is zero. Consider the carbon budget - the maximum emission limit that the Earth can sustain before warming. If we continue to emit emissions, this budget will be exceeded, and temperatures will continue to rise. Consider a tank that is three-fourths filled. A continuous stream of water is connected to this tank, so we need to stop this stream to prevent the water from overflowing; the stream here refers to the carbon emissions, and the overflow of water represents the temperature rise. January, 2022
The roadmap adopted by BRC focusses on retail operations guided by scientific experts is as follows: ·Put greenhouse gas data at the center of business decision-making. Efficient site management with renewable energy. Transition to low carbon logistics. Sustainable procurement. Helping employees and customers lead a low-carbon lifestyle.
Most emissions come from industries, particularly in the energy, metals, and transportation sectors. Any climate action will have to start with reducing or offsetting emissions from industrial and commercial activity. It is also necessary to cancel potential trade losses. According to the Carbon Disclosure Project, Indian companies could lose a total of more than Rs 7.14 lakh if nothing is done to mitigate climate change. These losses will result from phenomena like a flood, emission caps, regulations, changing customer behavior and preferences. There are many potentials in the future market if Indian retailers start creating an action plan for mitigating climate change. Mukesh Ambani's Oil to telecom conglomerate Reliance Industries Ltd. said it would be "net carbon zero" by 2035. Private lender HDFC Bank Ltd., Tata Consultancy Services Ltd. has set a goal of becoming carbon neutral by 2031/32. And that's not all; around 56 companies in India have made pacts and committed to reducing Greenhouse emissions according to a science-based initiative, a global coalition to set climate goals. Indian retailers need to develop an action plan like the British Retail Consortium (BRC) adopted. Retail Chronicles | Page 09
Companies have three main types of emissions. There are direct emissions from sources owned or controlled by the enterprise, such as furnaces, boilers, and transportation. In addition to this, there are indirect emissions from coalfired power consumed by companies. The third includes all other emissions generated in the corporate value chain. These three categories are Scope 1, Scope 2, and Scope 3.
Scope 1Direct emissions from fuel burned in company-owned or controlled facilities and vehicles Scope 2Indirect emissions from the generation of purchased electricity, steam, or heating and cooling consumed by the reporting entity. January, 2022
Scope 3 – Upstream and downstream of the value chain, and all other emissions within the valuation scope. Scope 1 and Scope 2 emissions can be reliably measured, but large retailers need to disclose these numbers in their annual reports with different methods, boundaries, and limited data. Therefore, Scope 3 presents a more significant challenge. However, Scope 3 emissions are likely to be the primary source of emissions, so they must be fully considered in the retailer's carbon footprint.
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A genuine concern and a collective effort are required if the retail industry wants to make a difference in protecting our home, Earth. Collaborations across countries and industries are the need of the hour; the future leaders will be the ones who move ahead with this vision and responsibility of mitigating climate change and reversing the damage we have already done.
January, 2022
RETAILING & METAVERSE
Raghav Khandelwal - MBA RM Retail Chronicles | Page 11
January, 2022
Introduction:
What is the Metaverse?
Most people heard the concept of Metaverse when the founder of Facebook, Mark Zuckerberg, announced that Facebook Inc would be named Meta. The term has been in existence since the late 90s, but now, it is used to define a connection between the physical and the virtual world. Through Metaverse, users will be brought together as one community, having shared experiences that were not possible through 2D applications. As a retailer, this question comes to our mind as is the future of retailing lies in the realm of Metaverse?
The term “Metaverse” first appeared in Neal Stephenson’s 1992 Novel named “Snow Crash”. This book is believed to have radically changed & altered the perspective of people for technology. In simple words, Metaverse is the parallel reality created by bringing together all virtual worlds to form a new universe just like ours. Metaverse is persistent, just like our universe. Even though we sleep and disconnect with the world for some time, the world continues to evolve and hence, Metaverse reflects the same instinct. Metaverse is a parallel reality, where one can work, communicate, play, etc., just like our world. It should be noted that Metaverse is not just a virtual version of the present-day internet, It exceeds the capacity of the present-day internet.
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January, 2022
Companies involved in building the Metaverse:
The future of Retail: Shopping with Avatars:
There are already many companies that have already started building foundations of the Metaverse. Twitch, Amazon’s Livestream gaming platform, have more than 140 million active monthly users, and they consume more than 2.2 Billion hours of live-stream content. One of the top fashion brands, Burberry, launched one of their collections in Livestream, which attracted approximately 40,000 views.
The concept of avatars was understood way back by online gamers as they used digital images as avatars to represent individuals in the digital world. Similarly, the Metaverse will allow online users to buy products in the digital world, taking the retailing experience to the next level. The experience can initially affect the traditional customer behaviour, but this will translate into a unique understanding of its own.
Facebook has clearly shown the potential of the Metaverse as they first launched their VR headset under the Oculus Brand in 2014. After that period, they have created a new Virtual Reality platform named Facebook Horizon, which allows users to step into a virtual, real-time version of Facebook and interact & engage in a variety of unique experiences that were never seen before.
Stores can offer unique outputs and items that allow one to develop their online personality more personalized to their authentic self. Recently, H&M opened their 3D metaverse store to let users buy products in the virtual world.
Companies, namely Google, Roblox, Disney, and many more, collectively build presence and platforms in the Metaverse with shared protocols. One of the necessary inferences drawn is that the Metaverse is and will not be made by only one entity but by everyone, be it individuals, brands, government, companies, etc.
Future of Retail in Metaverse: The shopping activity in the Metaverse can be a new concept to many users but, many companies and brands are already harnessing it. Some of the top cases of Virtual Retail are given below: Virtual Reality: VR headset manufacturers such as Oculus, HTC Vive, etc., have already developed platforms that can take advantage of the Metaverse.
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January, 2022
Products for Digital Avatars: Luxury brands, namely Louis Vuitton and Gucci, have started to offer accessories like jewellery for virtual avatars in the Metaverse.
Integrated Branding: Earlier, brands used to pay money for product placement in films and TV. But, the situation is dynamically changing. For instance, P&G and Hellman have partnered with online gaming for having a digital presence. Selling NFTs: Now, users can buy digital rendering of physical items in the digital world from brands like Crockpot.
A new & improved shopping experience: Alibaba has recently started to offer a virtual shopping experience to its customers. For instance, Alibaba used the annual shopping holiday in China, Singles Day, etc., to provide unique purchasing options. One of the newest additions is the virtual store using VR headsets paired with their smartphones for shopping. It’s an attractive and exciting way for retailers to offer users a new and improved experience to keep customers engaged on their sites. The Way ahead: We saw how the Metaverse is expanding and how much potential it holds to transform our lives with the discussion above. Though limited by the technologies, each of the applications is a step towards a new reality. Some brands are even buying virtual real estate and are hiring virtual architects to develop their digital presence. The organizations that will hold will be stuck in the real world, in the ghetto that the legacy internet will come.
AR or Augmented Reality: Retailers like Amazon, Walmart, IKEA, etc., have started investing in AR so that users can now begin visualizing items from their homes before buying, which enhances the overall shopping experience.
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January, 2022
RETAIL MARKET WORLDWIDE-2021
Harsh Gupta - MBA IB Retail Chronicles | Page 15
January, 2022
2021 was a roller coaster ride for almost all segments, with many ups and downs due to the pandemic. After the first wave of Covid 19, when everything was getting on track, the second wave knocked down the door. This situation brought so many changes in everyone's life. In such a confusing and unpleasant situation, how could the retail sector remain unaffected when other sectors face tremendous changes in their operations, demand, sales, price, trends change, work culture, technical change, etc., in 2020 to 2021? So, let's see the 2021 worldwide report card of the retail market. Worldwide Sales
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In 2021, when the industries were in the recovery phase, the worldwide retail market generated sales of approximately 25 trillion US dollars, with an increase of 7.19% from the year 2019, and the sales are still growing. Although the brick-and-mortar stores were the dominant mode of purchase, the estores gained worldwide popularity too. Ecommerce stores recorded worldwide sales of 4891 billion US Dollars, increasing approximately 14% from 2020. The same for the year 2020 was 27.60% from 2019 and was only 12% in 2019 from the year 2018. Thus, there was a significant increase in worldwide e-commerce retail sales in 2020 and 2021.
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Countries like India, the United States, China, Germany, etc.. were the world's top retail markets, and the US was the largest market in the world and closely followed by China.
Top Global Retailers Covid-19 gave a tough time to retailers in 2020 as they were not ready for situations like this. There was a lot of confusion. Brickand-mortar stores, malls, shops, etc., were closed. They faced huge losses. However, for some retailers, this situation was a boom for them as new demands were raised worldwide. A similar situation was observed in 2021. Thus, there were significant changes in the ranking of top retailers based on their worldwide sales. In 2021, Walmart continued to be the world's largest retailer, both domestically and internationally, and closely followed by Amazon.
. Social media advertisement, social media sales, influencer marketing, artificial intelligence, and Augmented Reality to enhance the shopping experience, etc., gained huge popularity as social media is used by over 3.6 billion people worldwide. According to a survey carried out in 2019, 25 percent of e-commerce companies planned to sell directly through social media platforms in 2020 Additionally, 15 percent of e-commerce companies reported that they were already selling on social media. Platforms like YouTube, Instagram, Tik Tok, etc., were some of the most successful influencer marketing. The retailers adopted more sustainable methods in 2021.
Apart from that, there was also a change in the global consumption of different products. There was an increase in global consumption of products and services like food and drinks, home improvement, household goods, home-based health and beauty, home-based leisure and entertainment, OTT subscriptions, etc. and vice versa for the products and services like apparel and accessories, cosmetics, and sun care, luxury goods, etc.
Global Market Trends There were some exciting trends observed the previous year worldwide. There was an increase in digital shops. The brick-andmortar store owners were inclined towards an increase in their digital presence.
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To conclude, the world has witnessed an enormous change in the trends and demands after 2020, in 2021. The retail markets efficiently understood and adopted the required changes to tackle Covid-19, which resulted in converting an unfavorable situation into their favor. This shift will be there for a long period, and many more surprises are yet to come in the year 2022.
January, 2022
PODCAST
TOP RETAIL TRENDS IN 2021
NET ZERO RETAIL
-AKSHITA KULSHRESHTHA
-AAYUSH GHILDIYAL
RETAILING & METAVERSE
RETAIL MARKET WORLDWIDE 2021
-RAGHAV KHANDELWAL
-HARSH GUPTA
Retail Chronicles | Page 18
January, 2022
TRIVIA
QUIZ
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January, 2022
Q1. By what year will Reliance Industries Ltd. be “Net carbon zero”? a) 2025 b) 2035 c) 2045 d) 2055
Q6. According to Shopify, what percentage of sales can be boost up by using AR? a) 66% b) 32% c) 45% d) 94%
Q2. Which one of these emissions is not a type of emission by companies/industries? a) Direct Emissions b) Indirect Emissions c) Evaporative Emissions d) Value Chain Emissions
Q7. Which of the following technologies has been introduced recently in the retail industry to boost safe and secure Omni-channel services. a) Cashless Transactions b) No-contact delivery c) Augmented reality d) Self-service kiosks
Q3. Which of these scopes/categories poses the most significant challenge to the retail industry? a) Scope 3 b) Scope 4 c) Scope 2 d) Scope 1
Q4. Which company secured the position of largest retailer according to total worldwide sales in year 2021? a) Amazon b) Walmart c) Alibaba d) Aldi
Q8. The word ‘Meta’ first appeared in which of the following novels? a) Snow Crash b) Project Hail Mary c) Neuromancer d) Nineteen Eighty-Four
Q9. The first apprarel retail store to provide the facility of shopping on Metaverse is: a) Zara b) H&M c) Louis Vuitton d) Gucci
Q5. In which range, worldwide sales (in Billion U.S. Dollars) of E-Commerce lies ? a) <1000 b) 1000 – 2000 c) 2000 – 4000 d) 4000 – 6000 Retail Chronicles | Page 20
January, 2022
REFERENCES https://www.statista.com/topics/5922/retail-marketworldwide/#dossierKeyfigures https://nrf.com/blog/2021-top-50-global-retailers https://www2.deloitte.com/content/dam/Deloitte/fr/Docum ents/consumer-business/global-power-of-retailing-2021.pdf https://explore.openaire.eu/search/publication? articleId=doajarticles::924428c0c6b70cdaa4b9d9a77559d9e9 https://www.forbes.com/sites/forbescoachescouncil/2018/0 8/02/yes-franchising-has-its-freedoms/?sh=70f192a23382
/retaillabsimsr @Retail_Lab @Retail_Lab