60% of industry professionals say investments in tech will increase in the remainder of the calendar year 2024
IndiaRetailing Insights: Technology investments in the retail sector will increase in the coming months according to a poll conducted by IndiaRetailing. About 60% of the total respondents who are retail professionals have indicated that the investments will increase and 20% of respondents believe that the increase will be only marginal.
A marginal 9% believe that tech investments will show a stable trend in the present year whereas 4% felt there will be no significant change.
Mixed response from retail players
In recent years, technology investments in the retail sector have grown significantly with the introduction of different enablers and service providers that facilitate a smooth journey for retailers in India.
IndiaRetailing had earlier reported that technologies like artificial intelligence (AI), virtual reality (VR), and augmented reality (AR) will gain immense popularity among retail players as predicted by leading chief technology officers (CTOs), chief information officers (CIOs) and chief digital and information officers (CDIOs) working in the area.
However, some of the experts that IndiaRetailing spoke to recently have given a mixed response to the same.
“From an Indian retail industry perspective, technology spending as a percentage of revenue is expected to remain flat or optimized over the next 12 months, at least,” said Bhavin Kothari, chief information officer (CIO) & head – of supply chain & logistics, at Ace Turtle. However, he added that his company’s tech investments remain bullish.
“While our revenues grow at a rapid pace, our tech investments will grow at an absolute level,” he said.
The Bengaluru-based tech-native retail company specialises in vertically integrated operations from design to direct consumer engagement, leveraging proprietary technology. It holds exclusive licenses for global brands like Lee, Wrangler, Toys“R” Us, and Babies“R” Us in India and South Asia.
Sharing a different perspective, New Delhi-based e-commerce enabler platform GoKwik’s founder and chief executive officer (CEO), Chirag Taneja said, “In the GoKwik network itself, 2,500 brands were onboarded last year—this shows that brands see value in the tech and data science-backed solutions”.
He revealed that emerging brands and existing D2C players too are considering and implementing tech solutions.
In the last couple of years, as compared to other categories, accessories, fashion and lifestyle brands have leveraged technology to provide seamless experiences. Brand representatives of big retail companies like Myntra, Titan, Reliance Retail, and Meesho have all aligned with the same.
For instance, fashion e-commerce platform Myntra and accessories brand Titan have invested in creating immersive and differentiated experiences. Similarly, Shoppers Stop strategically eyes the cloud as the best investment in the coming years.
In addition to this, beauty, wellness and personal care brands too have ramped up their investments.
“Considering the Digital Personal Data Protection (DPDP) Act 2023 and compliance on audit trail data, there will be new investment in IT,” said Lokesh Wagadre, vice president and head of technology, Kaya Ltd., a multinational skincare, haircare, and body care treatment provider based in Mumbai.
Areas of Focus
Brands that suggested an increase in investment have also shared the areas and other cutting-edge technologies that will witness prominence in recent times.
“MarTech is one of the areas where new investment will come to address the challenges related to new customers and retaining the existing customers,” added Wagadere.
Personal data protection, audit trail requirements, campaign management technologies, data analytics – AI/ML capabilities and GenAI BoT will be other areas of focus.
“Tech is one of the key drivers of e-retail sector growth and we will continue to see increased investment in tech providers across all facets of e-commerce. The role of enablers will also continue to gain momentum as supporters of e-commerce in their growth journey through their innovative and path-breaking solutions.,” added Taneja of Gokwik.
Artificial intelligence, Machine learning. Forecasting and analytics are areas of focus for Ace Turtle in the fiscal year 2025.
