Technopak's Saloni Nangia shares her thoughts on how the spread of technology is changing the spectrum of lifestyle brands.
Today, not enough is being spoken about what changes we forsee in the lifestyle brand segment, in the coming decade. How we shop today might be very different from how we might shop in the next 10 years. Saloni Nangia, president, Technopak – a management consulting firm, focussed on retail, consumer products, food and the textile sectors at afaqs!' Great Lifestyle Brands event as she shared her thoughts on how the entire spectrum of lifestyle brands is changing.
Sharing her views, she said, “It has taken us millions of years to reach the digital human stage, but what's interesting to take note of is the fact that what's happened in the last 10 years is really bigger than what happened over millions of years. What will happen in the next 10 years from now is going to be extremely different from what we have seen so far. The pace of change is absolutely unimaginable.”
She is of the opinion that for legacy brands this change is creating and will create a completely new spectrum. “The next decade would define who would be winning in this digitally creative world,” she said.
Talking about how digital inroads have been so rapid in a developing country such as ours, she spoke of the pace of change in terms of how technology has become a part of our lives — be it Facebook, Twitter, and Instagram, through just simple access to the internet or smartphone. Presenting facts, she quoted that from eight million users in 2010, Facebook today has grown to have 241 million users in India. The number of people with internet access has grown from 92 million to 566 million in the country, in the past decade.
She pointed out that e-commerce will be the key growth driver for lifestyle business in the coming decade. “The fashion/lifestyle business has been seeing 12-13 per cent growth every year — most of this growth will come from the digital platform in the coming years. While we will see more organised retail stores in the near future, the digital play will be the key driver of the industry's growth. And therefore, it is of utmost importance for lifestyle brands to understand that they cannot ignore e-commerce any longer,” she said.
She presented the key trends driving this growth and will become game-changers in the coming decade:
1. Disruption of the traditional business models.
Technology has disrupted the basic/traditional model in the lifestyle segment. And that has happened in many ways — new channels have been added, the target universe has increased, how customers discover a brand has changed, product lifecycle and its management has changed, customer connect and the competition has changed as well.
She opines that this change is basically driven by 'Born Digital' (phrase borrowed from book 'The Tech Whisperer') companies. These are companies that are born digital and do not have a legacy, for e.g. Amazon/Flipkart, Uber/Ola, Zomato, Airbnb and others. All the leagcy companies on the other had are trying to keep pace with what these digitally born companies are up to.
Citing the example of an electric scooter, she says it would have been impossible to imagine buying your e-scooter off Flipkart a few years back. The scooter can now be delivered at your doorstep with a single click.
Most luxury brands used to run on the six/eight-month cycle. Say, in February they would be planning for their winter collection that the model would walk the ramp in. There would be a leap time in which you could order for yourself what you then saw on the ramp. However, today, times have changed. You see a dress on a model on the ramp and next moment you could be ordering it.
2. Customer centricity.
Customer is the king. He forever has been. But the fact is they are the ones who are completely driving the business. “Today, it's not what brands have to offer but it is what customers are looking for,” she quipped.
The customer groups are changing today. It therefore becomes important to understand what's key to your TG and maintain your relevance and create your product and pricing accordingly. One fine example she gave was of Gucci launching a call center for its e-shoppers (millennials). One wouldn't have imagined a luxury brand going this far a few years back.
3. Product experience.
Today experience has become larger than the brand. It might not be true in every sense but could be a game-changer in the years to come. Customer experience management is something that the companies need to be investing in. The experience needs to be offered across all touchpoints and needs to be seamless. Virtual trial rooms, visual and voice search, chat box, are just some examples to comfort the customer and enrich their experiences. Nangia cited the example of Nike, which in USA has created a customised store for better product experience. A customer can personalise and customise a product according to his requirement and likes.
She said modifications need to be made in the traditional channels. These have to go hand in hand with the brand values and available infrastructure.
4. Collaborative Supply (Demand) Chain.
Today, instead of the supply chain, the market is mostly driven by demand chain. The customer data that the brands collect enables them to forecast the demand and work closely and plan accordingly the volumes, designs, etc. “It's a mix of demand and supply pull at the moment but in the next 10 years the demand pull would be stronger,” she explained.
A lot of Indian lifestyle brands at the moment are not investing enough in the manufaturing of the product. Brands are still very basic and traditional in that sense. All the international brands, however, including Zara and H&M, have grown in numbers because they have invested heavily in processing and manufacturing. In the coming years, Indian companies will need to updage the manufacturing technology. Nangia opines — brands will need to realign their module with the technological upgradations.
With the upgradation in technology, like that of cloud computing, brands will also need to upgrade their manforce. “Traditional talent might not be able to address the new requirement. The teams need to be up-skilled regularly and be updated with technological advancements,” she said.
With the increasing competition, the manforce will also need to be creative. “One needs to foster innovations, designs that help the brand to stand out in clutter that it might be in at the moment,” she added.
Concluding her presentation, Nangia said, “We are in times of fast evolution. Technology is here to stay. It is on us now to invent our tomorrows and stop worrying about the glories of what we did in the past and pace up with the updates — technologically and otherwise.”