IFF 2016: Millennials reforming food retail

The most awaited congregation of food & grocery retail fraternity – the 9^th annual India Food Forum – was held recently at Bandra Kurla Complex, Mumbai from 19-21 January 2016. Not only were the bigwigs of the food industry in attendance, but the three day forum was an excellent amalgamation of global experiences, new trends, and a zeal to deal with the challenges with progressive thought leadership.
The Forum was inaugurated by General (retd.) V K Singh, Union Minister State for Statistics and Programme Implementation (independent charge), Minister of State for External Affairs & Minister of State for Overseas Indian Affairs. Speaking on the occasion, the Minister said: “It is a pleasure to be at the event that has seen tremendous growth over a period of time. India Food Forum has not only matured over the years but it has also contributed a great deal to the way the industry has moved in India. I was having a look at some of the important publications that the Forum has been bringing out in various fields – whether it is on the malls in India or whether it is on the retail market…you name it and I am sure the Forum has researched the topic and put it all down together in a well-documented report.”
He further added, “India’s Food & Retail market is approximately Rs. 250000 crore today and I think it is going to not only double but triple by 2020. Now that is something the investors need to look at. India’s market is a varied market – it is primarily urban in some regions whereas not being a pure urban market in other regions; it is also a semi-urban market and it is also a rural market.”
“So, if the industry has to see phenomenal growth, you need to strategise for all these diff erent markets. Then only there would be success. Otherwise, you will fi nd there may be a glut in the urban market but we may not be able to touch what is available elsewhere. Th is means that retail chains, as part of their growth journey, need to take the small players under their fold. Th en only you will find that the growth would be much more than you have imagined because there are people already in the market who need to brought in and the quality control as well as the quality that you give out will make the difference,” he observed.
The inauguration of the event by Minister Singh was followed by a session on Food Vision 2025. It saw a distinguished panel of industry captains discuss the way forward to grow the food industry and ways to draw a new level of consumer satisfaction and the path of growth for India as a major food market – both as a producer and as a consumer.
Moderated by renowned retail expert B S Nagesh, Founder of TRRAIN, the dignitaries constituting the panel included Damodar Mall, CEO, Grocery Retail, Reliance Retail; Riyaaz Amlani, MD, Smoke House Grill and Mocha Café and President of National Restaurants Association of India; Shantanu Rastogi, Principal, General Atlantic; Sumanta Dutta, CBO-Operations and Customer Leadership, Coca-Cola; Vishak Kumar, CEO, Aditya Birla Retail; and Ankit Jain, Cofounder, Askmegrocery.com The session commenced by discussing the changes in consumer behaviour and purchasing patterns, and about the ways of bridging the gap between retailers and tech-savvy Indian consumers.
The industry stalwarts also discussed the way ahead for the industry, how emerging trends will influence and shape the future retail scenario in India, how it was possible to grow the overall pie of modern retail trade through ideas and innovation and how to evolve the business in this digital era to serve and delight the new tech-savvy consumers.
Sharing his views about e-retail, changing consumer behaviour and purchasing patterns, Ankit Jain said: “I don’t think that the basic food habits are changing…what we see is that 80-90 per cent of consumption remains the same. Consumers’ basic needs remain the same and it’s just the delta 10-20 per cent where people are experimenting. So it is 10-20 per cent of the total number of consumers that are experimenting…trying out the new mayo or some new organic food stuff that has been recently launched. So my point is that let’s first address the 80 per cent, which is all about the basic consumption stuff and then we can discuss about the remaining 20 per cent.”
Talking about the rise of online retail, Jain said: “I feel that the online space is one of biggest opportunities for retailers as well as a huge challenge. It is true that consumers today are not averse to change and they want to experiment. So that is an opportunity for us…we need to align our strategy to the food habits of consumers and present ourselves in a way that we fulfill the consumption patterns of all consumer segments.” Reiterating his earlier observation that basic food habits remain well-entrenched and are not susceptible to fast changes, he however noted that consumer behavior and mindset is undergoing a change and, in many cases, the changes are surprising enough. “Before I landed in this domain, I thought it was women who formed the biggest chunk of grocery shoppers. But our analysis show that more than 65-70 per cent of the shoppers are men and I feel that it is a trend, which is picking up,” observed Jain.
Talking along the same lines, Damodar Mall added: “I agree that food preferences are not dramatically changing but the manner in which a family discovers food and celebrates food is really changing. Putting together a meal in a family no longer requires cooking from scratch, which is what authentic cooking was all about earlier. Today, it is more like assembling a meal and eating it together. Apart from that, one very important thing is that we are dealing with a very confident consumer – it’s cool to be an Indian consumer today. One does not need to seek validation from outside. Therefore, in our stores, we find people very open to ideas, open to take risks, open to try out new products. As long as the products appeal to consumers, they will go out, try it and buy it. As I said, people are very open to new ideas; the consumer is looking for something new. So I believe this is the best time to be in the market.”
Taking the discussion forward, moderator Nagesh veered the talk to the health and wellness quotient in foods, which has emerged as another strong trend. Taking up the thread of conversation, Vishak Kumar said, “Health and wellness is becoming extremely important. At one level it is the Patanjali kind of companies, which are coming out with new health products and supplements aimed at making lives healthier. On the other level, it is about the awareness about how bad adulterated food can be and how bad pesticides can be. While there is not an actual shift in the purchase level, there is definitely an increase in the awareness level for these kinds of products. People now have an increased understanding of health and wellness. So, I would say that the growing consciousness towards wellness and organic food is the new evolving trend.”
Outlining his views on new consumer purchasing trends, Sumanta Dutta said: “Coca-Cola products are available in four million outlets and we would love to be at 10 million. I think there is a huge change in the beverage buying pattern – as you get into urban markets, you see the trend of many beverage options available today. People want juices, re-hydration products and more; they are into many evolved products like ice teas, juice with milk and many more.”
Highlighting the trends of consumer eating habits, Riyaaz Amlani, said: “Every five years or so, we keep waking up and start harping about how the health food trend is visible everywhere. That may be the case but I think we are putting too strong a point on it. For instance, we have a healthy soup on our menu, which we have to often throw away because nobody orders it. If I talk about consumer eating habits, the millennials are not worried about cholesterol. They are not going as much for the healthy options as they want to pamper themselves.
An average Indian eats out about 1.8 times a month, which is very low compared with the eating out frequency in Singapore and in other countries. So when we go to a restaurant we indulge a lot and the thoughts of dieting are the farthest from our minds. Besides, the millennials are very aspirational and their quests for exciting and cool food options are bringing about a change in the eating habits of younger generations.”
Amplifying the theme of how eating habits of consumers are evolving, Shantanu Rastogi said: “I believe that apart from health and wellness there is another important segment that will change the way of food retail for the millennials (the millennials are people born after 1980). This segment of millennials is hyper-connected and considers itself as global citizens – it has less allegiance to the geography they were born in. This segment is thinking, behaving and acting in a different way and they are all entering the consuming age. In the next five years they are going to be the prime consuming class, and I feel they will bring about a change in the retail landscape.”
Way ahead
The panel and its speakers concluded that food & grocery retail industry will move on a progressive track despite the challenges and the onslaught of new, emerging trends. There was unanimity among the panelists that the sector offers ample potential to grow and evolve, especially with support from the digital channel. At the same time, it was also acknowledged that consumer behaviour and consumer purchasing trends will keep evolving and changing in the years to come, which will present both an opportunity as well as a challenge for the retail industry.