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2009 tiptoed in with an air of caution. Retailers, like the rest of the business community, were most eager to see the New Year in, hoping that it washed away the remnants of a not-so-happening second half of 2008. Customers, for their part ushered in 2009 on healthy shopping with heavy discounts and promotional offers to lure them in. They did bite the bait, but were cautious about how much and on what they spent their money. Expansion plans are being announced, but again with that note of caution, leveraging all the learning these past couple of years has gathered. Certainly, the most changes are being seen in segments that saw most action and as a result, were hit the most, such as grocery and perishables. Some other segments like luxury and lifestyle continued to chug along. Retail real estate saw significant correction, with malls having to device new ways to retain retail brands and anchor tenants. Experts opine that these were much-needed corrections, but customers and retailers are waiting for the momentum to pick up and are hoping it happens in 2009.
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The new year opened with a mixed bag. There are retailers who are planning expansions, but are moving ahead with caution. On the other hand, there are others that are putting their plans on hold.
Festival and seasonal sales have not been exciting for retailers in 2008, especially the second half. Malls are the most hit, with footfall conversions being low, and rentals dipping on a realty crunch. What’s more, anchor tenants are hard to come by as everyone is playing a wait and watch game before investing in a mall outlet.
Retailers are focusing on tier 2 cities, more so in the aftermath of poor sales in major metros. The south is hit too as the techie crowd, the traditional big spenders, are getting cautious too.
Apparel and accessory marketers are seeing a slowdown in sales. Customers are deferring purchases as these do not constitute necessities. Sales are more occasion driven now. Luxury and lifestyle shopping is not as hit by recession and the economic slowdown as are other segments. India is seeing a host of international brands set to enter the country, largely through the franchisee route. However, luxury malls saw footfalls falling and discreet discounts being made available to the persistent shopper.
The clutter and chaos of markets and high street stores was a pull by itself not long ag. Increasingly, shoppers hard-pressed for time or simply put out by the crowds in cities are turning to online shopping.
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Chillibreeze Research Team
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