Technology and Internet
Shiprocket-CII-Praxis report projects D2C to become a $60 billion industry by FY27
30 Jun 2022

India’s online commerce market is growing at a rapid pace. The growing eCommerce sector positively influences the growth of D2C (Direct-to-Consumer) brands in India. Due to higher consumer spending and rising eCommerce penetration, the D2C market is ready to grow strongly over the coming five years. The latest report by Praxis Global Alliance, in collaboration with Shiprocket, India’s largest eCommerce enablement platform, and CII (Confederation of Indian Industries), states that D2C in India is a $12 billion market and is also witnessing remarkable and rapid growth.

The numbers in the report are paving the way for a new model of eCommerce wherein brands choose to own and operate their own sales counters on the web. This trend has been reaffirmed by the fact that many D2C brands across India have crossed the INR 100-crore benchmark in revenue, and the revenue benchmark was achieved only in 3-5 years since launching operations.

Aiding these trends is the brands’ agility and Go-To-Market (GTM) strategy, alongside robust digital capabilities that have helped their businesses soar and achieve a competitive edge. The report shows that brand packaging has also been an essential factor in attracting buyers. The Average Order Value (AOV) on each product and a hefty gain in gross margins are the fundamental tailwinds that further foster this trend.

To estimate the size of the D2C market in India, we have considered seven categories: personal care, clothing and footwear, groceries and refined foods, jewelry, electronics, health care, home furnishings, and garden. Incumbent players (such as Unilever, Marico, Tata Consumer Products, and ITC) are either acquiring prominent D2C brands or choosing the organic route of launching their own brands online and building their own D2C platforms. However, for D2C brands to maintain this growth, they need to strengthen product innovation and revamp manufacturing and sourcing strategies to become market leaders.

The D2C report aims to provide various industry stakeholders, including business leaders, an overall perspective on the market. The situation is evolving rapidly, and some expected scenarios might have slight variations. The report reflects our perspectives as of June 2022. We look forward to discussing with our partners across sectors and exchanging notes.

To read the complete report, download it here.

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