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
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.
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.
read the complete report, download it here.