Retailers Association of India (RAI), in association with the National Restaurant Association of India (NRAI), hosted a webinar titled ‘Future of Food Business: Reviving Consumer Confidence’ on May 22, 2020, as a part of its ongoing ‘Coping with Covid-19’ series. The panel comprised food business stalwarts including Nitin Saluja, founder, Chaayos; Pratik Pota, CEO, Jubilant Foodworks Ltd.; Riyaaz Amlani, CEO & MD, Impresario Handmade Restaurants; Sagar Daryani, co-founder & CEO, Wow! Momo Foods Pvt. Ltd.; Zorawar Kalra, founder & MD, Massive Restaurants. The panel was moderated by Anurag Katriar, president, NRAI; ED & CEO, deGustibus Hospitality.
Speaking about the biggest challenge all businesses are facing Saluja said, “The customer sentiment right now is driven by fear. We, as an entire fraternity, need to figure out how to tackle that fear as best as possible.”
Offering a solution to the big question, Kalra said, “We need to move away from using the word contactless dining to stress-free dining. The only way to get the consumer’s confidence is to let them know that ‘we have your back’. Customers need to be assured that eating at a restaurant is actually safer than eating at home since we have more checks and balances in place.”
Offering a different perspective Pota said that the crisis was not just a demand crisis but also a supply crisis. “Supply chains have been disrupted; inventory shrinkage is bound to happen. There’ll be supply shrinkage along with demand pullback,” he said. Pointing out the silver-lining though he added, “The fundamentals and the potential of our category haven’t changed but it is a matter of time I would say that 6-9 months would be a good time frame to get back.”
Spreading optimism was Daryani, who said, “I believe that India will be the fastest country to bounce back.” Speaking about the change in the way of operating, the entrepreneur said, “Our entire business models are going to change and that’ll change the business models of the entire ecosystem.”
Giving his opinion on the situation, Amlani said, “Currently, we are battling with the sentiment which is at best skittish. We are seeing a lot of pent up demand. There’s a case to be made that there is revenge buying but there is also going to be a lot of tentativeness. You have to know your restaurant well, how you’re going to fill the hole in people’s souls.”
Ending the discussion on an optimistic note, Katriar said, “I don’t think this industry will fail because dining out is the one of the most natural things that humans do. Having said that to win over consumers we will need to take a plethora of ‘confidence-building’ measures. Every stakeholder in this ecosystem must realise that in these difficult times in the post-Covid era can be conducted on the older terms.”
The following are the key takeaways from the session:
Changing Consumer Behaviour
? As consumers become more discerning about hygiene, they will move away from street food to the organised sector.
? Consumers who were hesitant to adopt digital and delivery are now embracing the two.
? Food safety and hygiene will replace price as the biggest differentiator in the future.
Effects on Industry
? Year 2020 is going to be more about consolidation.
? There is going to be a new era of pre-order and takeaway as in other countries.
? Delivery-driven brands might recover faster than dine-in brands.
? Recovery to come in 6 to 9 months.
? A lot of small towns have come back to significant delivery growth.
? The volume of delivery is less but ticket size is increasing as most ordering done during the lockdown is for the whole family.
? Cash Based Deliveries will be affected.
? Agile businesses will come out as winners.
? Collaborations between businesses are going to be common.
? Instances of Mergers & Acquisitions will increase significantly.
? Delivery revenues will gain a lot of prominence, even for experience-driven businesses.
Advice for Businesses
? Technology-driven interventions are needed to reduce the amount of human contact in the consumer cycle.
? Recalibrated conversations with aggregators about commissions, discount, delivery experience of the customers are needed.
? Radio silence is bad. Communication from brands is extremely important. Brands must reassure the consumers and retain their trust.
? Consumer sentiment is the primary thing we need to fix the dine-in scenario.
? Use social media to stay in touch with consumers.
? Don’t run after micro-trends. Instead, learn what your business is all about.
? Health, hygiene and happiness are central to the recovery.