Vishakha Singh
Sep 17, 2012

FDI in retail: More of a highway than a no way

An article by Vishakha Singh of Aurora Comms, on FDI in retail and how it will affect the marketing and advertising industry

FDI in retail: More of a highway than a no way

There are always two sides of a coin and so as to any big change that comes into the play like the current FDI in retail.  I am personally super excited about this and I will illustrate the same. But I am spending more and more time in reading, and listening and talking to people who are apprehensive about the news. You know why? Because every negative thought makes the point stronger.

Many of us who are reading this would have had a fair idea of growth in small towns. I belong to a very small town in Bihar, which went through its phase of regress and progress in the past decade. There is a sea change from what it was a decade ago. Now the girls in my small town wear dresses; a few years ago no one wore even a pair of jeans, forget the dress. There are more scooties and cars around than tri-cycle rickshaws.  And everyone is brand conscious, be it Dixcy innerwear or Tommy Hilfiger. Now even a road-peddler sells branded products like Angry Birds, T-shirts, Google eye wear, doesn’t matter real or fake.  And if all of this is happening in smaller towns, much bigger things are happening in bigger cities. This I called the ‘highway effect’. Whatever happened in the last decade, two major highway projects changed our lives - the phenomenal growth of infrastructure and telecommunications.  Brands travelled from one city to another. Produces travelled from interior villages to high-street stores. All becoming a part of our lives. If farmers are getting more educated and knowledgeable about technology usage, there are many high net worth individuals who are investing their monies in setting up business about things as simple as ripening bananas in remote towns. The highway does that to you - the two way flow.

FDI in retail is another highway. It is going to open a lot more than your and my mind can currently sit down and calculate.  This simple piece of news has changed the mood of India Inc. They are suddenly excited about the announcement and there is a sudden gush of faith in the current government policies. Optimism brings in growth.

There is no question it will generate more and more employment. If retail square feet will be a question, stores will go from single storied to multi storied. If they go multi storied, they will need people to construct and reconstruct.  But I am not here to talk on what it will do to the overall economy. I am interested in what it will do to us, the marketing and advertising industry.

More products would mean more brands. More brands would need more agencies to create those brands. More agencies would mean specialisation of the agencies and so on and so forth. We have been engaged in shopper marketing and retail media for years and it takes a lot to evangelise. This will suddenly be speedier. Cheers, people in media and advertising, we will see some inflow of monies coming in. And the good news is there are two major states that have already agreed - Maharashtra and Delhi. So we need not worry if it will generate work for us or not, we need to worry about how we will meet the demand (states that have agreed: Delhi, Assam, Maharashtra, Andhra Pradesh, Rajasthan, Uttarakhand, Haryana, Manipur and Jammu & Kashmir).

FDI in retail will bring in best practices from around the world. Best practices in product strategy, in distribution and delivery strategy, in managing the inventory line would mean improvisation of the services. We all have to gear up to be a part of evolving services industry, not just to shape it up but also to enjoy experiencing it.

We will see sharpening of the talent pool that we have around. We will see growth in our knowledge quotient. Competition is always good and here the competition is going to be for growth. It wont be a do-or-die situation, but it will be ‘do better and excel’ or ‘do same and grow at your own pace’ situation.

Let’s get ready for a high-speed drive on the highway.

(The author has built various media brands and runs the retail media and shopper marketing firm Aurora Comms)


Campaign India

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