“Bad for shop assistants, good for shoppers. That is the obvious inference from the upheaval in retailing that is leaving shopping malls and high streets…” says The Economist (March 13, 2021). The article goes on to admit that it may be an over-simplification of the crisis in retailing and how consumers will continue to crave for human attention and help when they shop.
The bigger question, however, is ‘will retail-linked jobs disappear totally’? Or will they become more complex and nuanced?
When the Indian economy opened up in the late 1990s and car brands started flooding the market, one of the well-paying jobs this created was the customer-facing job in a car retailer. These well-dressed men and the occasional women were often graduates with a good knowledge of multiple languages and car engineering/performance factors. The dealer salesmen, as they were called, had to be ready to answer all manner of multiple questions from the visitor to the retail showroom, often a first time buyer of a car.
But come 2010 the scenario changed dramatically. The Indian car buyer was by then better informed to the extent dealer salesmen even dispensed with knowing and explaining the various features of each model or variant. Why? Because they were sure that the car buyer would have done their internet research before taking the trouble of walking into a showroom.
Which, in turn, led to some new challenges. The dealer salesman had to become digitally savvy to use a hand-held device to take the customer through car’s special features. Often, the dealer salesman had to ensure that they captured the views of the potential customer to be fed back to the manufacturer. All this was being done not post-facto, but as the customer was test driving the car.
The role played by the car salesman changed significantly. Some elements vanished but new elements got added.
The retail sector is one of the biggest job creators in any economy. Some studies indicate that the Indian retail sector contributes as much as 22% of the country’s GDP, though the Government of India’s Employment News portal estimates that the GDP contribution of retail is a more modest 10%. In terms of employment, all estimates say that retail jobs accounts for 8% of total employment. This estimate seems to be on the lower side since in the EU one in six workers have retail or wholesale jobs and in the US one in nine jobs come from the retail sector. Even if we assume that the Indian retail sector contributes just 8% to the overall employment pool, it is still one of the biggest employers.
Dumbed down, or hi-tech
Today, post COVID pandemic, that statistic is under a big threat. Where are the threats coming from?
To begin with, the consumer is now adopting an omnichannel approach to shopping. Either they are searching online and shopping offline. Or they are searching and experiencing offline and shopping online. The prime case is where a consumer visits an electronic store to get a touch-feel of the mobile phone and then buys it online.
Consumers are today a lot more informed than they were a decade or so ago. And that is going to make serious demands on the retail, consumer-facing jobs.
The rise of e-commerce has created a huge challenge to brick and mortar retailers. Many had to hurriedly become omnichannel during the pandemic to the extent that they were shocked at the kind of response they received. A luxury watch retailer was amazed that consumers were willing to order a watch costing lakhs of rupees, pay the amount and wait for a week for the delivery to happen.
Some brands are now deciding to go entirely ‘DTC’, or direct to consumer. Either through their own website or through e-commerce platforms. For example, Nike, a global brand, is actively embracing the DTC mantra. They have been able to move 40% of their revenues to DTC, cutting out all middlemen.
These trends have some serious implications for young men and women looking for retail jobs. Will retail as we have known vanish? Or will it get completely reinvented in the coming decade?
Dorothy Davis in the book ‘A History of Shopping’ traces the emergence of shops in the Elizabethan Age, when craftsmen who had a one-on-one relationship with customers set up their shops to peddle other people’s goods, earning a markup. Then came the industrial revolution which led to a major transformation of retail as a growing number of working class citizens could now buy quality products. This was supported by the growth of advertising.
The next revolution has been the ongoing and evolving digital movement, with power shifting markedly first from manufacturer to retailer and now significantly to the consumer.
While we see more and more products being sold through the e-commerce route, at a national level they only account for a small percentage (less than 5%) of consumer goods sales. The contribution of e-commerce is much higher in some segments like luxury goods, fashion apparel and electronics [a luxury car brand recently confessed that 5% of their sales happened without the customer visiting a car showroom].
But there are some aberrations in this general picture. Euromonitor has estimated that online sales of diapers in India will reach 25% by 2023. In China more than half of pet foods is sold online, compared with about a tenth elsewhere, says The Economist [March 13, 2021].
So what is going to happen to retail jobs? Will they get dumbed down or become high-tech? The answer is ‘it depends’.
Shopping offers many experiences. A Journal of Advertising Research article [June 2018] listed eight reasons for visiting a mall. These were escapism, browsing, socialization, activity, clothing shopping, uniqueness, service and aesthetics.
As you can see only one of the eight is ‘shopping’. And savvy retail marketers have been sensitized to the many reasons why a customer will walk into a mall. And though they may walk in for just ‘browsing’, they may end up ‘shopping’ given the right push. Upmarket malls have mastered the art of creating events to attract and engage their clientele. These could be music shows, dance shows or even a book talk [I was invited by an upmarket mall in Bangalore to deliver a book talk in the central atrium; I was surprised to see a fairly good gathering].
The nature of retail jobs will thus change and the change will vary with each sector. However, the one change that will be common across all sectors will be the increasing use of digital tools. So irrespective of the retail outlet you are wanting to work in, you will have to master the skill of using a pad or a smart phone to interact with your customers and also gather customer information.
While that is par-for-course across all sectors, we could see the emergence of other new types of jobs in retail.
Your shopping history in his palm
If we take the high-end retail jobs like luxury brands or fashion, jobs will go through a significant change with the emergence of advisors and not just shopping assistants. If you walk into a fashion outlet you may want some advice on what top will go with what bottom. And if the shop assistant can whip out a pad and show you the combination options, chances are you will be ready to buy. If, instead, the shop assistant is only ready to show you the ‘latest’ you may want to skip the ‘buy’ stage.
One example of this new shopping assistant cum adviser concept is Project Eve from Reliance, an experiment that is trying to create a unique fashion apparel buying experience for the upmarket 25 to 40 year old women of India. Its retail outlet in an upmarket mall, for instance, has executives who can help the consumer make the right choice for the right occasion, and also curate products depending on the body shape etc.
The retail sector has traditionally offered numerous job options and these would include customer sales associates, floor manager, store manager, retail operations, retail merchandising, visual merchandising, back end operations etc. In addition to these, the coming decade will see the deployment of new digital tools to improve customer experience.
You walk into this Westside store, for instance. As you move towards the women’s kurti section, the floor in-charge walks up to you, addresses you “Welcome back Mrs Gopal. Glad to see you at our store again. I hope you liked what you bought last month from us. The mauve coloured top. We now have a new collection of pure linen trousers. Would you like to try them on?”.
How did this happen? Technology makes this possible. The camera at the entrance of the store will grab your facial profile. The algorithm matches your face to the database of regular customers at Westside, and the floor manager gets an alert on her pad. With some additional information on your past purchase. If you think this is a scene from the movie Minority Report, you are wrong. This is happening as we speak.
If many retailers adopt technologies like these, it will create a whole new range of jobs at the front end and at the back end. Cameras will have to be installed and serviced. Data has to be captured about all regular customers. Algorithms have to be developed to learn from customer pictures and figure out how to do a match in a few seconds. This would mean that even if the shop level staff may decline to match the traffic, the back-end retail jobs will boom. New skills will be in demand.
And the initial data of India’s retail sector employing 8% of all workers, this number will not go down but will go up. What will also happen is the diversity of jobs that will emerge in retail. Especially as retailers embracie an omni-channel approach with all the complexity this entails. While the majority of jobs may still possibly be in customer-facing positions, job opportunities will see a seismic shift in many ways creating new types of jobs unheard of till a decade ago.