India’s e-retail market is projected to grow by 25-30 per cent annually over the next five years to touch $120-$140 billion by fiscal 2025-26, surpassing modern trade, according to a report by US management consultancy Bain & Company headquartered in Boston. Much of this growth will be fuelled by small-town India, which accounts for four of every five new shoppers.
India’s count of e-retail shoppers touched 140 million in 2020 as more consumers moved online amid the pandemic. The country already has the third largest online shopper base globally, behind China and the United States.India's e-retail market is projected to grow by 25-30 per cent annually over the next five years to touch $120-$140 billion by fiscal 2025-26, surpassing modern trade, according to a report by US management consultancy Bain & Company. Much of this growth will be fuelled by small-town India, which accounts for four of every five new shoppers.#
Even as the total retail market shrunk by 5 per cent at the end of fiscal 2020-21 on the back of the COVID-19-induced operational restrictions, the online segment surged by a considerable 25 per cent to reach $38 billion.
“COVID-19 provided a massive stimulus to India’s e-retail penetration, accelerating it by 12 months to reach approximately 4.6 per cent in FY21. This increase was even greater in metro cities, as one in three people shopped online at least once across the top eight metro cities last year. Bengaluru led the way…,” analysts at the firm said in the report.
One in 10 users have tried voice search while one in three new users avail a vernacular platform interface. “The role of voice, vernacular and social media in online shopping is expanding. Voice and vernacular are vital to attract the next generation of online shoppers,” the analysts said.
Influencers and social media channels are also increasingly shaping up the shopping trajectory of consumers. For instance, almost 40 per cent of online shoppers made at least one purchase through platforms like Facebook, Instagram and WhatsApp last year.
“Growing popularity of online shopping has pushed established and digitally native brands to opt for a D2C (direct to consumer) channel via their websites…Growing relevance of the online channel has made it a must-play and must-win frontier for brands. Winning an outsized share of online consumer spending requires a series of investments. This includes investments in visibility, supply chain, merchandising, conversion, and key capabilities,” the report added.
Fibre2Fashion News Desk (DS)
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