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Grant Thornton Bharat’s latest survey report, titled ‘Beyond the Basket: Understanding Consumer Preferences within Omni-Channel Setups,’ delves into the evolving preferences of Indian consumers as digital adoption and rising disposable incomes reshape shopping behaviors. With insights from over 2,500 respondents, the report highlights a pronounced shift toward premium products and quick-commerce (Q-com) platforms.
These findings emphasise how shoppers are increasingly prioritising quality, convenience, and personalisation, driving substantial changes across retail channels and prompting brands to adapt, and how businesses can unlock growth by creating synergies between digital and physical retail, harnessing the power of hybrid models.
Analysing consumer preferences across various retail channels, the survey identifies quick commerce as the favored mode for daily essentials, with 85% of respondents choosing it for food and grocery purchases. Meanwhile, clothing and accessories lead in e-commerce platforms, capturing 75% of volume sales. For high-value purchases, however, physical stores remain the top choice, with more than 50% of respondents preferring in-store shopping for high value premium products. Consumer affinity for physical stores when purchasing premium products highlights their quest for tactile experiences and quality assurances, which brick-and-mortar retailers continue to offer.
“India’s retail ecosystem is undergoing a pivotal shift as consumers seek a balance between the convenience of digital platforms and the quality assurance offered by traditional stores. Our report highlights that while quick-commerce has gained popularity for everyday essentials with over 30% of consumers opting for it, high-value purchases still predominantly occur offline, since consumers still prefer brick-and-mortar stores for high-value items. This trend presents a unique opportunity for brands to adopt a hybrid model that combines the speed of digital access for essentials with in-store experiences that ensure quality for premium products. As consumer preferences evolve, businesses that can seamlessly integrate online and offline experiences will be best positioned to succeed in this rapidly transforming retail landscape”.
Naveen Malpani
Partner and Consumer Industry Leader, Grant Thornton Bharat
Despite their enduring appeal for high-value purchases, traditional stores face significant challenges. Nearly 38% respondents cite limited product range as a major drawback, while 37% point to higher prices as a key deterrent. In response, retailers are increasingly adopting hybrid models, merging the reliability of physical stores with the convenience of digital platforms. By expanding product offerings, offering competitive pricing, and providing delivery options, these models enhance customer satisfaction and trust. Further, regulatory advancements, such as the Data Protection Act 2023, are likely to ensure a secure and transparent environment for digital transactions, making the hybrid approach a sustainable pathway for growth in India’s evolving retail landscape.
The rapid rise of Q-com presents opportunities but also brings operational challenges that impact scalability and profitability. High operational expenses related to warehousing and expedited delivery continue to strain the business model, with delivery costs accounting for up to 70% of gross margins on orders averaging INR 300–500. To overcome current challenges, Q-com and e-commerce platforms must focus on operational efficiency, sustainability, and building consumer trust. Leveraging AI-driven data analytics can improve inventory management and optimize delivery routes, balancing both cost and speed. Partnerships with local retailers can expand hyperlocal distribution, broadening product choices while reducing dependency on central warehouses.
As India's retail landscape continues to evolve, the future looks bright, with a growing focus on sustainability, convenience, and quality. A seamless blend of online and offline experiences, coupled with a strong commitment to sustainability, will be key to driving growth and building trust with consumers. By prioritizing omnichannel strategies, last-mile logistics, and digital platforms, and adapting to changing consumer demands, retailers can drive sustainable growth, build a loyal customer base, and thrive in the years to come.
About the report
Grant Thornton Bharat conducted this survey among 2,500 respondents to capture insights into consumer purchasing patterns in 2024. This report provides actionable insights for brands navigating the omni-channel retail space and exploring consumer expectations in an increasingly digital market.
The press release first appeared in Economic Times on 21 November 2024
