Indian Retail’s Next Chapter: Growth, Innovation & Opportunity

Hello and welcome to the March edition of Replenish, the monthly newsletter brought to you by the Retailers Association of India (RAI).

As we catch our breath after an exhilarating Retail Leadership Summit (RLS), it’s impossible not to reflect on the sheer scale and impact of this year’s event. ?From insightful discussions on omnichannel growth to fiery debates on the evolving nature of discretionary spending, the summit reinforced one key message—Indian retail is amid a transformation, and those who adapt will thrive.

And just as we wrapped up RLS, two major reports were released—each offering a deep dive into India’s retail landscape and consumer behaviour.

Report #1: Winning in Bharat & India – The Retail Kaleidoscope (BCG & RAI)

This report underscores a fundamental shift—India is no longer a one-size-fits-all retail market. As we head towards an INR 190 trillion+ retail economy by 2034, the opportunities lie in diversity, differentiation, and digital transformation.

Key Takeaways from the Report:

?? Two Indias, One Market: While premiumisation is rising, value-for-money remains paramount—retailers must cater to both ends of the spectrum. ?? Digital Acceleration, But Offline Still Reigns: Online sales are surging, but 58% of transactions remain purely offline. Omnichannel strategies are critical. ?? Picking the Right Consumer Cohort Matters: Whether it's mass grocery, fast fashion, or premium experiences, retailers that define their niche and execute sharply will win.

To win in India, retailers need to embrace the ANDs—premium AND affordable, digital AND physical, national AND regional strategies.

Report #2: India’s Changing Discretionary Spending – Key Insights for Brands (Deloitte & RAI)

This report paints an optimistic picture of discretionary spending in India. With rising incomes, India’s private consumption is growing at 7.3% annually, outpacing global trends. The report highlights premiumisation, experience-led consumption, and the rapid rise of new commerce models as defining factors shaping India’s retail future.

Key Insights:

?? Discretionary Spending Boom: By 2030, India’s discretionary spending is expected to grow at 8.7% CAGR, with urban areas seeing 8.4% growth and rural areas an even stronger 9.1%. ?? The Gen Z Effect: Expected to make up 50% of the population by 2030, young consumers are shaping brand narratives, driving digital-first shopping, and demanding personalized experiences. ?? Premiumisation is No Longer a Metro-Only Trend: Tier 2 & 3 cities are seeing an explosion of demand for aspirational brands, quick commerce, and organized retail experiences.

The RAI Perspective: Optimism and Opportunity in 2025

These reports signal one thing loud and clear: Indian retail is gearing up for a golden decade. The combination of rising consumer affluence, evolving digital behaviours, and retail innovation is setting the stage for unprecedented growth opportunities.

The Union Budget 2025 has further strengthened this momentum with measures aimed at boosting consumption, supporting MSMEs, and enhancing digital infrastructure. The push for financial inclusion and increased access to credit—particularly for small businesses and rural consumers—means more spending power, more transactions, and more growth for the industry.

As we step into this exciting future, RAI remains committed to being the voice of retailers—facilitating policy discussions, driving industry collaborations, and ensuring that businesses of all sizes and segments can thrive in India’s evolving retail landscape.

Until next time, keep innovating, keep growing!

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