The Indian technology and services market is poised to touch US$350 billion by 2025, as stated in the recently launched Nasscom-McKinsey’s report titled Perspective 2025: Shaping the Digital Revolution. The market will witness a steady growth to reach US$350 billion from US$132 billion in 2015. Innovation will be a major factor among those driving the next phase of growth for Indian technology and services market.
The report also states that the industry is expected to grow at over 11% to US$225 billion in 2020 and 10% plus to US$350 billion by 2025. Additionally, the total addressable market for global technology and business services will grow to about US$4 trillion by 2025, at an average annual rate of about 3.6%.
With such a promising market at disposal, location based technologies such as beacons can be explored to their full potential in India. The current global and domestic market presents a huge opportunity for businesses to build expertise in new technologies and deliver value through them. Moreover, the Location Based Services (LBS) and Real-Time Location Systems (RTLS) market itself is expected to grow from US$11.36 billion in 2015 to US$54.95 billion by 2020, at a CAGR of 37.1%. This is one of the primary reasons why Indian retailers should invest in beacons to directly communicate with customers through their mobile devices and drive business intelligence. Besides this, there are many vital factors that are propelling Indian retailers towards beacons.
Let’s take a look at four factors that will drive retailers in India to invest in proximity marketing:
1) India’s rising smartphone adoption rate
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Counterpoint, an independent market research and consulting firm, released a new report revealing that India has surpassed the US to become the second biggest smartphone market in the world with an annual growth rate of 15%. According to the report, the Indian smartphone shipment grew by 23% and has now crossed the milestone of 100 million units. The smartphone user base of India now stands at US$220 million.
The growth in smartphone adoption is also affecting converged commerce as consumers use smartphones more often than expected to make critical buying decisions. For instance, more than 80% of smartphone owners use their smartphones to make a purchase decision, according to the Consulting Mobile Commerce Survey. 55% of in-store shoppers use their smartphones to search for information about the product to make a buying decision. 71% of in-store shoppers who use smartphone for product information say that their device has become an important part of their holistic in-store shopping experience.
Enhanced customer experience is becoming a key factor in attracting new customers and building loyalty for brands. Therefore, retailers are investing in inventive ways to offer tailored privileges to their customers. One of the best ways to enhance customer experience is by using location based technologies such as iBeacon, so as to personalise a customer’s experience based on his/her location. The growing use of smartphones to enhance user experience is further paving a path for iBeacon technology to grow and thrive in India. Retailers can easily integrate beacons with their own mobile app or a popular third party app to create an omni-channel experience with multiple points-of-sale. They can also use these devices to add exciting elements to a mobile app in order to drive business profit and provide a seamless user experience.
2) IoT boom in India
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Internet of Things (IoT) is growing at a fast pace as is evident from Research firm IDC’s report stating that the worldwide IoT market is poised to grow to US$1.7 trillion by 2020 with a compound annual growth rate (CAGR) of 16.9%. According to The Internet of Things Ecosystem Research Report by Business Insider, the number of IoT devices is projected to grow to 24 billion in the same time. Indian market is moving rapidly in the same direction. As per Cisco, India is predicted to add 8.3 million networked devices every month. In fact, IoE (Internet of Everything) has the potential to create US$511 billion in value in India over the next decade.
One of the primary developments in IoT is the emergence of beacons. Beacons form the preferred solution for retailers since it is becoming a tool to:
– Personalise customer service based on wish lists, purchase history, ordering, etc.
– Configure sales and promotional activities on a store to store basis
– Analyse footfall and manage sales assistance
– Track inventories and obtain delivery updates
3) India’s growing retail market
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India’s retail market is expected to nearly double to US$ 1 trillion by 2020 from US$ 600 billion in 2015, according to the Boston Consulting Group and Retailers Association of India’s report titled Retail 2020: Retrospect, Reinvent, Rewrite. This growth will be driven by income growth, urbanisation and attitudinal shifts. While the overall retail market will grow at 12% per annum, modern trade market which includes hypermarkets, supermarkets, and other organized retail outlets, will grow twice as fast at 20% per annum.
Retailers today have realized that brands that fail to embrace omni-channel strategies to deliver quality experience will soon be at a competitive disadvantage. Various retailers such as the Dubai-based Landmark Group which runs department store chain Lifestyle and Max in India has therefore shown interest in leveraging different channels and investing in omni-channel.
According to an interesting report titled Retail in the era of the connected consumer published by AT Kearney and Retailers Association of India (RAI), about 93% of Indian retailers are likely to adopt new technologies such as the digital wallet to enable cashless shopping. The report identifies several key areas on which retailers currently need to focus:
– Communicating authentic value proposition across digital and physical channels
– Enhancing customers’ end to end shopping experience through use of technology
– Increasing two way engagements with customers through digital channels
– Delivering a frictionless shopping experience via data analytics
With technology being ranked as one of the biggest barriers while integrating back-end systems, a great way to start is to leverage iBeacon technology. Besides being seen as a technology with high value by 70% of the fastest growing retailers, iBeacon technology has turned out to be a perfect solution to provide aid to retailers in the key areas mentioned earlier. Retailers worldwide are using beacons to create a quality and personalised shopping experience for shoppers since “customers are happy to share more information across mediums and channels but want this to be used for some benefit and not irritation.”
4) Evolving consumer behaviour
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Consumer buying habits have undergone a drastic change due to the emergence of smartphones and round-the-year discounts across product categories with a variety of options. Additionally, consumers today have become wiser and ensure that they have researched all their options before shopping. Same holds true for Indian shoppers.
The Retail Without Limits – A Modern Commercial Society: Indian Responses 2015 report led by Oracle, the global software and cloud major, reveals that Indian shoppers want transparency and convenience as a part of their shopping experience. Indian shoppers are challenging retailers to invest in technology that enables seamless, converged retail experiences – from research and purchasing to fulfillment and returns. The report also stated that nearly 97% of the Indian shoppers want retailers to invest in technology.
One of the ways retailers can deliver a converged commerce experience that connects physical stores with the digital world is by leveraging beacons. Beacons allow businesses to learn more about consumer behaviour via analytical data and thereafter accordingly personalise services for them. They further give brands an opportunity to interact with customers not only at a store level but also at an aisle level.
India is reaching an inflection point in technology adoption with social, mobile, cloud and analytics driving digital disruption in the country. The time is right for businesses to invest in iBeacon technology, particularly with the government’s ‘Digital India’ initiative, which aims to increase connectivity and transform the country into a digitally-empowered society. Beacons can be of great assistance in taking this initiative forward!
If you are planning a beacon pilot, take a look at Beaconstac, that includes everything you need to get started. Using Beaconstac you can set up your own campaign, without a developer’s help!