It seems that Reliance Industries is now ready to repeat the scene of disruptions it caused in the Telecom Industry in India in the Retail Sector as well. To know more about this update, hang on with this article.
Indian Market is well aware of the impact of Reliance Jio in the telecom industry and what level of disruption has been caused by Jio in this industry. By following various marketing strategies like competitive pricing, freebies, etc. Jio has able to cover a market share of over 35% in a significantly shorter period. Simultaneously, the Telecom industry has witnessed many companies’ exit and is left out with only 3 major players in the market: Jio, Airtel, and Vi.
Likewise, the current business strategies of Reliance Retail appear to cause the same disruptions in the retail sector, thus expanding the Reliance Retail market share.
Indian Grocery Market is estimated to be around $608 billion, and on absolute terms, it is expected to grow at a 20% rate in the coming 2-3 years.
To participate in this growth rate, Reliance Retail competitors include global MNCs like HUL, Nestle, Coco-Cola, etc. It could develop their brands in a similar product line-up.
Reliance Retail has launched a brand called “Snac Tac” in the noodles product line to compete with Nestle’s Maggi.
This brand of Reliance Retail is occupying space on the shelf in the supermarkets, which also consists of big brands like Maggi, etc. Furthermore, Snactac is almost similar to Maggi in terms of pattern, colour combinations, and many other factors without infringing any trademarks.
This business strategy initially attracts shoppers by providing options to the existing products of big giants. Later on, the cost-comparison theme also comes up, and Snactac, whose cost is 18% less than the Maggi, also adds to the product’s consumer base.
On the same front, Reliance Retail is also competing with the brands of HUL as well.
Not only this, but Reliance Retail has also come up with their soft drinks to keep pace with the Coca-Cola brand in the market.
Including the Big Bazar Stores, Reliance Retail currently has 2100+ stores.
A general question can be raised here: How much will these stores cater to the Indian retail market?
The catch here is Mukesh Ambani-led Reliance Retail is also focusing on Kirana Segments.
The crucial factor that can work favouring Reliance Retails is the heavy margins or commissions they provide to the distributors.
On one side, where Reliance Retail is giving 20% margins or commissions to the distributors, the MNCs players lack much behind on this component. They comparatively provide low margins of nearly 12% only.
Through all such steps and strategies, Reliance Retails is trying to gain market share in the retail sector.
Reliance Retail, India’s biggest retailer, is approaching its steps in the FMCG segment. Still, they have significantly covered an eminent position in the Apparel section in the past few years, despite not spending much on Advertisement and Promotion.
Ajio, a fashion and lifestyle brand owned by Reliance Retail, has set a remarkable pricing strategy to attract consumers.
The Key mantra that Reliance Retail is working on is producing its brands, having an economical advertisement, putting that brands on the right shelves in the supermarket, and keeping the distribution network strict.
Reliance Retail is working precisely on every path to disrupt the retail sector and gain an impressive market share. It will be an exciting thing to watch how these developments will take place in this industry. Also, MNCs like Nestle, HUL, etc., are noticing these Reliance Retail actions and getting things noted down.
For the same reasons, Reliance Industries is working hard to acquire Future Group to boost its presence in Urban Markets. And Further, to expand their market in the distribution network, Kirana stores, small moms and pops stores, etc.
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