Brick & mortar outlets to have their share despite consumer comfort in online buying: Willy J Kruh

Willy J Kruh, global chairman, consumer markets, KPMG International, tells Arnab Dutta in an interview how companies need to address millennials seriously if they intend to win in the marketplace. Edited excerpts:

Where does India figure among emerging countries as a consumer market?

By 2030 India will be a global powerhouse. Millennials - those born between 1980s and the early 2000s - are revolutionising consumerism across the world. With some 700 million millennials, India even today is a huge market. To grow consistently India needs to focus on protection of consumer rights. In many key economies that is an important component.

India is also emerging as a market for high net worth individuals. Are they not driving consumption?

India is also poised to become the largest market for luxury products globally. People moving out of poverty, e-commerce growth, retail growth and supply chain improvement will lead to more investments and job creation. The government's recent focus on building more cities will lead to faster urbanisation. All that is going to boost consumerism in the country.

How prepared are companies to take on the challenge of e-commerce?

Although many of them are trying, they are not yet ready to meet the need of the millennials and the changing structure of retail. The potential of e-commerce is huge in India. In 2014, India had $5.3 billion e-commerce revenue, which is not even close to the top 10 countries. India is estimated to touch $17 billion 2017, but with 1.25 billion people that is not good enough.

While the number of Internet users was predicted to touch 317 million in 2017, by June 2015 it is already 354 million.

The comfort of online buying is going to boost e-commerce, but brick and mortar outlets will have their share in the consumer space. And modern trade is set to grow because its true potential has not been realised yet in India.

The recent controversy over instant noodles has hit investor and consumer sentiment. Do you see things changing for the better?

As Indian consumers become more aware, they will start demanding more and authenticity and credibility will follow. Many companies across the globe have been in similar situations. Getting out of the crisis depends on how forthright they are, how quickly they deal with it. Any company that can deal with such situations honestly, fix the problem, and move on is an obvious winner. Those who try to dodge and use publicity as a tool will lose consumer trust.