SINGAPORE – Media OutReach Newswire – February 22, 2024 – In a year that has witnessed a reshuffling of emerging markets’ potentials, global consultancy
Kearneywe are in 2023
Global Retail Development Index (GRDI) captures the heart of a retail landscape at a crossroads. The report, a biannual survey of the world’s most promising retail markets, highlights the agility and dynamism of retail economies adapting to a reshaped world.
Countries in the Asia-Pacific (APAC) region perform well in the global rankings
While the obvious candidates – China and India – continue to generate enduring appeal to global investors due to their market size and rapidly growing consumer base, a host of other exciting opportunities are emerging among their neighbors in the Asia-Pacific region. Across the region, APAC countries have displayed remarkable retail growth trajectories, with five APAC countries (India, China, Malaysia, Indonesia and Bangladesh) occupying positions among the top 15 economies in which retailers must prioritize their presence, based on the GRDI.
In China, innovative technologies, experiential retail concepts and a highly digitalized retail market continue to drive consumer spending. India’s retail sector is thriving thanks to a large working population, rapid urbanization and government initiatives such as Digital India, which are propelling e-commerce and modern retail formats.
Looking at emerging markets in Southeast Asia, Indonesia, for example, benefits from a growing middle class, expanding infrastructure and increasing urbanization, fostering a dynamic market for players of traditional and modern retail. At the same time, the Philippines and Cambodia demonstrate significant catch-up potential, fueled again by middle-class growth and urbanization, as well as favorable government policies attracting foreign investment.
Bangladesh, another notable example of an emerging market experiencing strong growth in the retail sector, has been propelled by its strong ready-made garment export industry, attracting major international brands and contributing significantly significant to its economic growth.
Overall, APAC countries are pillars of strength in the growing retail sector. The global retail e-commerce sector is expected to show a strong increase in sales, adding an absolute value of $1.4 trillion between 2022 and 2027. Of this growth, 64% is expected to come from emerging markets. APAC countries, in particular, are expected to take the lead in the digital sector due to the rapid growth expected in China, Indonesia, Malaysia, Vietnam, Thailand and India.
Six key trends emerge from this year’s GRDI
Globally, as retail growth expands beyond traditional powerhouses, the GRDI report identifies six crucial trends shaping the retail landscape in emerging markets:
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Macroeconomic uncertainty remains high, with the global economic recovery gradual and variable across developing economies.
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Consumers are turning to cheaper, local and private label items due to inflationary pressure.
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The growth of e-commerce continues unabated, with growth predicted to be twice that of physical retail by 2027.
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Omnichannel strategies are becoming increasingly essential, with retailers in developing markets investing in omnichannel capabilities.
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The rise of electronic payments and BNPL options is reshaping consumer behavior, with rapid adoption across APAC and MEA.
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Retail AI and technology innovations are being leveraged to create new experiential marketing approaches to attract and serve consumers.
Siddharth Pathak, Asia Pacific Co-Head, Consumer and Retail Practices, Kearney said:
“This year’s GRDI reflects the diverse retail potential among Asia’s emerging economies. From established powers like China and India to rising stars like Indonesia and Vietnam, each country offers distinct opportunities and challenges for retail investing in the region.“.
“Success in this dynamic market depends on retailers’ ability to adapt, innovate and strategically navigate the diverse retail landscapes,” he added.
As global retail players strive to adapt to a landscape marked by changes in consumer behavior, technology adoption and competitive activity, GRDI 2023 provides a much-needed roadmap for develop sustainable strategic responses and forge winning value propositions.
Please find a link to the full report here:
The Global Retail Development Index 2023
Hashtag: #Kearney #GlobalRetailDevelopmentIndex #GRDI
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