RETAIL CHRONICLES - SEPTEMBER EDITION

Retail

Chronicles

Monthly Newsletter | Volume 4 | Issue 3 | September 2019

CONTENTS

03

EVOLUTION OF EDIBLE OIL MARKET How has the Indian edible oil industry evolved over the years and where it currently stands.

08

Sagar Anam | Onkar Joshi Abhishek Wakode | Parth Reshamiya | Urvashi Dhabalia | Bharat Gupta

SHOPPING MALL If you spend fifteen minutes in a mall you will pass more people than our ancestors saw during their lifetime.

12

CONTENT TEAM

TRADE SUSPENSION

DESIGN TEAM Surabhi Upadhyay | Sachin Gosh Archish Raval | Ayush Shah | Pushpak Holani | Ayush Goyal | Shriya Mahajan

How the trade occurs with neighboring countries India and Pkistan

16

TECH IN BEAUTY INDUSTRY

From beauty bots to NYKKA how has technology changed the landscape of the beauty and personal care industry.

EDITING TEAM Ayush Gupta Abhishek Wakode

EVOLUTION OF EDIBLE OIL MARKET Bharat Gupta PGDM RM

Retail Chronicles | Page 3

September, 2019

THE INDIAN EDIBLE OIL MARKET . The growth in production of domestic edible oil has not been able to keep pace with the growth of consumption.

Continuous increase in the gap between demand and supply of edible oil has forced India to do huge import from leading exporter countries of edible oil.

The demand supply gap is becoming wider mainly due to limited availability of oil seeds, shifting of acreage to other crops and increase in demand of edible oil.

India edible oil Industry consisting of mostly palm oil, soyabean oil, sunflower oil, mustard oil, rice bran oil, blended oil, groundnut oil and cottonseed oil market consumption was valued at 24.20 million tons (MT) in 2016-17, and an estimated 23.95 MT in 2017-18. India’s edible oil consumption stands at number two globally, behind China (35 MT). More than 55-60% of whose demand is met from imports.The share of raw oil, refined oil and vanaspati in the total edible oil market is estimated roughly at 35%, 60% and 5% respectively. The consumption of refined palmolein (RBD palmolein) as well as its blending with other oils has increased substantially over the years and is used extensively in hotels, restaurants and in preparation of wide varieties of food products.il.

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September, 2019

Issues and Challenges in India’s Edible oil market

Top Players Major companies operating in the Indian edible oil market include The Adani Wilmar Ltd., Cargill Inc., Ruchi Soya Industries Ltd., Agrotech Foods Ltd., Ricela Health, Jhunjhunwala Vanaspati Ltd., ConAgra Foods, Rasoya Proteins, Marico, NK Proteins, Kamani Oil Industries, Bunge Limited, and Gabani Industries. The market is projected to be controlled by numerous national and multinational brands due to the rising dependence on imports along with liberalization by the government.

The biggest challenge remains pricing, as an increase in Indian import duties, appreciation of Euro/US Dollar against the Rupee, and higher product costs will result in a higher cost to the end consumer. Though the duty differential between crude and Ratings Outlook of Indian Edible Oil Industry of refined palm oil is 7.5%, edible oil sellers are finding it more convenient to import refined palm oil directly from Malaysia and Indonesia and sell it in the domestic market

Other issues being faced: High Dependence on imports Low Agricultural productivity Irregular and high dependence on monsoon Absence of Technology for Oil Refinery Lower Capacity Utilization

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September, 2019

Government Initiatives Government has allotted 100% FDI in oil palm plantations which have enabled to reduce edible oil deficit and dependence on imports from Europe and Southeast Asia. The government is currently running ‘National Mission on Oilseeds and Oil Palm (NMOOP)’ to encourage the adoption of newly released varieties and improved agro-techniques in oilseed crops. The mission targets increasing production of oilseeds to 42 mn tonnes by FY2022 from estimated 34 mn tonnes in FY2017 Other major initiatives · Promotion of FDI in India Edible Oil market ·Import and Export Regulations Imposed by the Government ·NMOOP ·Minimum Support Price for Oilseeds

Edible Oil Brands Making a Healthy Shift in Narrative

Over the years, many companies like Sundrop Heart, Fortune light, Saffola and many more have come out using less and less cholesterol triggers in their products.

Saffola had the initial lead when they focused on heart health. They were able to establish a very clear distinction in the market with the help of this identity. In fact, they continue to invest in strengthening their connect with heart health. However, they have also extended their brand to other health requirements of a person beyond the heart. This has allowed them to leverage and monetize the equity created earlier.

Adani Wilmar-owned brand Fortune was launched as the 'better oil'.

The communication centred around 'guilt-free' eating. It was targeted at the health conscious consumer who is unable to enjoy the food as he/she is concerned about the ill effects of oil. The message was captured in the phrase "Thoda Aur Chalega" (a little more will do). The launch was extremely successful and within two years Fortune was the No. 1 brand of cooking oil in India..

Retail Chronicles | Page 6

September, 2019

Fortune Edible Oils and Foods, had launched its latest campaign – ‘Ab ki baar shudhta ka prachaar’ with an aim to promote its Kachi Ghani Mustard Oil. The campaign positions the variant as a 100% pure mustard oil by taking high moral ground. As awareness about such health concerns continues to increase, it pushes brands towards working better. The newfound health consciousness is the driving force behind any initiative, with an agenda not only to serve the concerned but also spread the effect all across the nation.

Way Ahead A quality-conscious Indian population has driven the sales of branded packaged goods across the country, with edible oil leading the way. Packaged edible oil currently was valued at Rs 1.3 trillion ($19.5 billion) in 2017, with a share of over 30 percent of the Rs 4.34 trillion ($65 billion) packaged foods market. However, the per capita consumption still has potential to grow, with India at 17 kilograms (kg) against the global average of 25 kg.

Consumption patterns have shifted rapidly since, as palm oil, soybean and sunflower oil have become the preferred vegetable oils are expected to penetrate regional markets further in the future, with the packaged edible oil segment leading the way for future growth of the industry in the country, while groundnut, mustard, sesame and other local oils still manage to retain some share regionally.

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September, 2019

FUTURE OF MALLS Parth Reshamiya PGDM RM

If you spend fifteen minutes in a shopping mall, you will pass more people than our ancestors saw during their entire lifetimes.

-Rolf Dobelli

Retail Chronicles | Page 8

September, 2019

SHOPPING MALLS : FROM SELLING GOODS TO SELLING EXPERIENCE Retail Chronicles | Page 9

Definition of the market – “A market is a place where two parties can gather to facilitate the exchange of goods and services.” Yes, it is true, a market is a place for the meeting of buyers and sellers, but in this digital era, the definition of the market is changing day by day. The competition today is disrupting. Sellers are using many innovative techniques to attract customers. In today’s era, the firm that can serve the customer the best can win the competition. In the era where ecommerce is spreading its legs,

August, 2019

We are here to discuss the future of the place which was once used to be one stops shopping solution for many of the city dwellers. yes, we are here to discuss the future of shopping malls.

And to be frank, teenagers are now sitting on the internet everywhere, so their obvious choice will be internet over the physical malls. So, when we think about the mall, is it simply a waste of space now?

Well not exactly.

The Future of Mall: Micro-Cities Combining Entertainment, Wellness, Learning, and Personalized ProductMatching

The mall of the past was a place you hang out when you get bored. The mall was a key part of many people’s lives back in the day, but it’s not the case anymore.

Ordering something online - even at the risk of it not fitting - is preferable over having to physically go to the mall. With city traffic increasing, the thought of ordering something online while watching the episode of "Sacred Games" is better than going to the mall in the traffic.; you can’t compare these scenarios. One is hard and one is easy. I will go with easy every time. People used to find community at the mall. It was used to be the "town square." Now it is not. Today people are convening at places like the gym or meet-ups at coffee shops and bars.

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The advantage the mall has is it’s a large piece of real estate. It’s not productive to simply use this real estate as a place to display dusty inventory. For each mall which has a large amount of real estate, there is a possibility of better consumer experience and better customer satisfaction. The opportunity for customer experience innovation is to use the mall as a place to connect people and create engaging experiences. What would the mall look like if it provided the same speed, relevance and personalization as Netflix, Amazon or Spotify?

The mall is moving at a snail's pace to catch up with the user experiences of these companies - many retail spaces are still empty and trying to maintain relevance. Future for malls is to reimagine and reengineer malls and shopping centers as Consumer Engagement Spaces." Engagement is not the word that comes to mind for most of us when we think of the mall. Customers today walk around the mall but they are not engaged.

August, 2019

They often walk with their head down engaged on their smartphones. The question is how to get the attention of these consumers whose attention span is decreasing day by day?

Today words like AI, virtual reality and business intelligence are prevailing, malls can also use these technologies to engage their customers. Japanese firm SoftBank and French robotic manufacturer Aldebaran partnered in 2010 to develop Pepper, a humanoid robot that can interact with customers and ‘perceive human emotions’. Pepper is used as a customer service greeter and representative in 140 SoftBank mobile stores in Japan. During the trial of the product at apparel store the Ave, 98% increase in customer interactions, 20% increase in foot traffic and 300% increase in revenue was recorded. Such AI robots appear to at least initially boost store interest and sales, probably because customers feel excited to try out a session with it. The Mall of America also deploys Pepper.

Robot at the mall of America

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August, 2019

Neiman Marcus, a leading departmental store in America has deployed another cutting-edge tech called Memory Mirror produced by MemoMi Labs Inc, which allows shoppers to digitally compare outfits by capturing a 360-degree view of themselves in an outfit and letting them send these images to friends via email and social media. This is a virtual dressing room, which even online shoppers cannot experience or match as of now.

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The now outmoded idea of malls as places for retailers to push out product offerings into a mass-market must be replaced by a pull-marketing approach where the mall is designed around the needs and interests of an increasingly diverse consumer market, often segmented by age, ethnicity, and locality. Today malls are not just a mass market, they are the point of sale for happiness and good experiences. The need is there, the question is are retailers ready to take that leap.

September, 2019

THE COCA-COLA COMPANY Abhishek Wakode PGDM RM

How did the world's biggest beverages cpmpany come about and how it dominates its competitiors.

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September, 2019

THE COCACOLA COMPANY

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The story of the world’s largest beverage manufacturer and distributor company is something that amuses everyone.

With more than 2800 products available in more than 200 countries, the company is famous for producing and selling soft drinks and citrus beverages. Reports say that 10,000 cokes are being consumed every second of each day. With such an immense network and the highest market share, the expectations are always high and hence it is very important to meet those expectations especially when there is such fierce competition in the same segment.

September, 2019

Marketing Strategy Coca-Cola is known to market its products with the help of emotional marketing. With many successful campaigns across the globe such as, “Open Happiness”, “Share a Coke – share a feeling” and “Hug me” Coca-Cola positions itself among the positive emotions shared by people. They are known to connect their products with emotions and then they sell that emotion rather than the product itself. Probably the best way of marketing is to target the people on an emotional plane, which is exactly how this company has achieved such milestones. Although facing fierce competition from the famous rival PepsiCo, Coca-Cola has successfully maintained its market share from almost 130years. This was possible only due to the connect it has with the people and also the brand image. What was earlier known to be a drink with cocaine in it, it transitioned itself as a carbonated drink and finally, we have zero-calorie coke with the same taste as the original coke. So what lies in the future for Coca-Cola?

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September, 2019

Spreading unhealthy With great power comes great responsibility�, so is the case with this massive company. Many people take coke as an unhealthy drink and researches supports the claim too. With high caffeine and sugar content, coke is infamous among health-conscious people. With an already established market, coke should work on some healthy drinks which will help it to improve its brand image thus keeping the legacy alive. Also, with increasing demand for packaged drinking water, the company should aggressively market its brand "Kinley" to diversify its product range. There are a lot of opportunities in developing countries where the company can expand in terms of market share before the other competitors do so.

Also, Coca-Cola can work on the snacks and food segment too which its rival PepsiCo has already done.

affect the "Wholesome image" of the company and it will be a mistake to do so.

When we look at the journey of this immensely successful company, we can see that the brand image is a very important factor and it is something that has to be maintained forever. If a company like CocaCola gets involved in the cannabis business, it might contradict its basic principle of targeting the positive emotions of the people. For some, it's just a drink but for many, it's a way of celebrating joy and happiness.

Reports say that the Coca-Cola company is interested in producing cannabis-infused drinks in the future. Billionaire Warren Buffet, who has shares worth$19.5 billion in the company has said that this decision will

Retail Chronicles | Page 15

September, 2019

TECHNOLOGY IN THE BEAUTY AND PERSONAL CARE INDUSTRY

by Urvashi Dhabalia PGDM-RM 2019-21 Retail Chronicles | Page 15

September, 2019

The one thing that has changed in almost every other sector of retail has not yet disrupted the beauty industry: ecommerce and technology. Beauty and Personal Care products are still sold primarily as they always have been, in the good old ‘brick and mortar’ stores.

Sure, people buy these products to replenish their stocks through Amazon, and other e-commerce websites and there are some other sites selling beauty direct-to-consumer as well like NYKAA but for the most part, the traditional model of going to a store to try out a product before purchasing still dominates. Unlike many other types of retail, online purchasing of new products has not caught on in the beauty business yet.

Industry experts will tell you it’s because beauty is very personal. There is no way of knowing if you will like a shade of foundation or lipstick on yourself or if a particular skincare product will suit your skin type without actually trying those products.

And hence Beauty and Personal care industry is among the last industries to adapt to the online way of doing business. But things are surely changing.

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Modern shoppers value convenience.

Digital-savvy millennials are the fastestgrowing group of consumers and are always looking for the next big thing in both technology and beauty, which is why beauty retail and technology go hand-in-hand. It’s crucial for retailers to keep up the pace with consumer

SKIN DIAGNOSTIC TOOLS

Part of the appeal of going to a store to purchase skincare is being able to chat through your skin concerns with an expert and receiving their personalized recommendations. However, this is being translated to online via a host of different skin diagnostic tools that offer analysis from the comfort of home.

Various brands are now working on apps that help you pick the right product without you having to visit their store. The process could involve things like uploading your picture, answering a detailed questionnaire (or an express questionnaire if you are too busy to spare 4 minutes) and picking your skin priorities.

You now receive a list of Expert Recommendations with regard to the skincare routine, dos and don’ts, and product suggestions. All you now need to do is put the product in the cart and make the payment. Et Voila!

September, 2019

SMART MIRRORS (AUGMENTED REALITY)

Smart Mirrors like HiMirror and ModiFace are transforming the way we think about makeup. HiMirror can be purchased for your home and does everything from analyzing your skin, track skin’s progress, track product use and even provide diverse lighting scenarios (such as a dinner party or the office) so that you can perfect your skin and makeup routine. ModiFace is the secret behind AR makeup modules, used on e-commerce sites, and in-store magic mirror software, like Sephora’s, that enables you to try on makeup, record makeup sessions and find correct shades.

BEAUTY BOTS Product choice can be overwhelming and lead to consumer analysis paralysis.

Interactive product advisors are supposed to combat that byoffering up sensible, useful product suggestions based on the consumer’s personal needs.

More beauty brands are starting to use chatbots, like Facebook messenger, to help users search, explore, and virtually try-on beauty products. “Although the fashion industry has struggled with its chatbot strategy, beauty brands are placing more confidence in the Retail Chronicles | Page 17

technology” according to DigiDay. Brands like Sephora, Estee Lauder, and L’Oreal are some of the first to develop chatbots.

The goal of the technology is to increase customer engagement and heighten the user experience, while also being able to collect data and insights for brands. The chatbots go hand in hand with the AR (Augmented Reality) technology where users can try-on products from home before buying them. The chatbots assist the AR technology by answering any questions users may have, such as how to pick the perfect shade of foundation.

CONCLUSION Technology is assisting the cosmetics industry to blossom into its full form.

Presumably, we are heading towards a world with increasingly greater integration between technology and beauty.As consumers continue to embrace technology in all areas of their lives, the boundaries between the virtual and realworld will increasingly blur. Beauty and skincare brands will need to put technology at the center of their strategy making it an intrinsic part of the product if they want to stay relevant.

September, 2019

Retail Chronicle is a monthly newsletter of Retail Lab, the retail committee of KJ Somiaya Institute of Management Studies and Research, Mumbai.

Images used in Retail Chronical are subject to copyright.

/retaillabsimsr @Retail_Lab @Retail_Lab

KJ SOMAIYA INSTITUTE MANAGEMENT STUDIES RESEARCH, MUMBAI.

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