Customer First, Millennial Magic & Tech Innovations - Inaugural Session, Internet Commerce Summit 2020, #Delhi Edition

The Internet Commerce Summit, #Delhi edition kicked off with a very interesting inaugural session that I had the good fortune to host and moderate. In this, I was in conversation with Mr. Lalit Agarwal, CMD, V-Mart Retail Limited, Ms. Soumya Kant, Founding Member, Clovia.com and Mr. Tarun Tiwari, Director-Product, Nykaa. The panelists represented a mix of traditional physical retail and digital native enterprises who were bullish on being omni-channel. The conversation over nearly 45 minutes centered around the millennial customer, millennials in metros vs. millennials in tier 2/3 towns, their engagement imperatives, the importance of private labels, managing replenishment in the age of “fast-fashion” and the art & importance of telling stories.

V-Mart, as a chain of value-departmental stores, has over 220 outlets in tier 2/3 towns across 18 odd states and operates in under-served markets where Bharat shops. Clovia started as an online brand in the intimate wear category and now also has an offline presence with about 15 stores and 175 other brand touch-points including marketplaces. Nykaa, the wellness and beauty retailer, too, operates as a mix of online and offline – their predominantly online presence is bolstered by about 75 odd stores on ground.

As the discussions progressed, it was very clear that the following facts resonated with all the 3 brands:

1.    Millennials are a core part their target audience

2.    Tier 2/3 towns contribute a lot to their success

3.    Every customer seeks a personalized experience irrespective of the channel of interaction

4.    Customer engagements are experiments in story telling – with the store staff at a physical store playing a crucial role in delivering these engagements.

5.    The need to go digital is a given.

With the explosion of social media channels, the easy availability of smart mobile phones and the resultant democratization of information availability, the millennial in the tier 2/3 towns of India is as empowered and informed as her cousin in a metro. She is aware of the latest products, the latest in fashion and the latest in trends at the same time as her counterpart in a metro. She is aspirational and wants to look good, dress good and be appreciated in the social world. Be it regular wear clothes or intimate wear or beauty and wellness products – the millennial’s need is to aspire for the best products and the right price at a place where she needs it.

The conversations have changed, too. The millennial customer of today welcomes advice and education (like in the intimate wear category) and she demands experiences to be as personalized as possible. All the 3 brands – V-Mart, Clovia and Nykaa – strive to up the dialogue to make the engagement with her more meaningful and fruitful. As Soumya elucidates, on the web, the content on the website has to be fresh and engaging that will keep her involved. Brands need to speak her language of slangs and acronyms so that she identifies positively with the brand! Lalit believes in the power of storytelling to keep the engagement alive and worthy of a millennial’s attention. At V-Mart, the customer is God and the staff are the “pujaris” – with the “mantras” having to change to adapt to the changing demeanour of the Gods! The pujaris need to know everything about the merchandise to be able to craft the right story to keep the God interested. Tarun acknowledges that the customer today is more health/society/environment conscious than ever before. The astute customer of today prefers non-toxic, natural components in products that they buy and has respect for brands that exhibit a high degree of social responsibility.

Given these circumstances, going digital is a given – it is not an option anymore – for all brands, including a value retail brand like V-Mart that is focused on tier 2/3 towns. Lalit strongly believes in the leverage of digital to enable the tier 2/3 consumers to access the brand and interact with the same. V-Mart is piloting omni-channel use cases across a few stores to start with. Clovia relies a lot of technology to sharpen their production planning process and merchandise replenishment capabilities – a strong, data science driven approach helps Clovia manage weekly replenishments with relative ease. Lalit, however, did sound out a caveat in terms of the difficulty on the unit economics front given the daunting overheads (cost of delivery, returns, cash management charges etc.) of omni channel retail.

In the 45 minutes I spent quizzing the 3 on their business strategies in today’s world, we did touch upon the importance of private labels (Clovia is 100% private label, Nykaa has a basket of aspirational brands and V-Mart relies on a mix of private as well as exclusive brands) in bolstering profitability and for being the medium to “better control the brand language”. All the 3 panelists were also unequivocally of the opinion that while the external customer was important, the employee – the internal customer – was equally important and Tarun of Nykaa did make an important point that a millennial employee needs to be managed with a higher degree of empathy and understanding.

The discussion ended with Lalit, Soumya and Tarun endorsing that brands should be honest in setting customer expectations, follow them up with delivering the expectations and last but not the least, always – always listen to your customers – both external as well an internal.

I had a ring-side view to this conversation as I hosted and moderated this session. In case you want to listen in to the details, do check out https://www.youtube.com/watch?v=uoPiN8zbrzw&feature=youtu.be 

Happy viewing and look forward to your comments!