Majority of the Indian consumers are price-conscious which is one of the major Ps of marketing. As per a report, India is expected to be the world’s third-largest economy by the end of this decade. 1.3 billion people would be using smartphones along with the internet and 500 million would be opting for online shopping. Since Avendus Capital shared its report in 2020 on D2C Brands might cross $100 Billion market in India by 2025, all the communities of entrepreneurs, investors, business researchers and analysts are evaluating and finding avenues to explore revenues in the exponentially growing market. D2C is one of the major topics of interest in many boardroom meetings and office travel discussions with colleagues.
With a population of 140 crore people, 4G and 5G revolutionary telecom and internet services, rising purchasing power and an increase in purchasing options the D2C market has to grow exponentially. The most promising growth has been witnessed in the Fashion D2C sub-segment and it is projected to be $48.3 Billion by 2025. The pandemic lockdown situation accelerated the growth of D2C in India in 2020 and 2021 due to unfavorable conditions, government policies and personal safety which restricted the choices for consumers. The Tier 3 and Tier 4 markets also witnessed growth. The majority of the Sharks in the recent popular entrepreneurial reality tv show Shark Tanks are from the D2C background. This itself is a testimony of the success and popularity of the D2C market. Cherry on the cake, popular celebrities have started their D2C ventures and a few have become cofounders or investors through funding as investors in D2C startups. The IT Infrastructure, the VC investments, Glamour, Government Policies and consumer acceptance is all working favorably for the Indian D2C segment.
India has nurtured 800+ new-age homegrown D2C brands. Global FMCG, Electronics, Fashion and E-commerce brands are banking on India for their profits through FDI policy and promising market. American organizations have acquired Indian e-commerce brands in the last decade. During pandemic, major D2C brand websites saw an increase of 85% rise in demand. Chinese app players have been eliminated from the Indian landscape by the strong NDA Government since the 2020 skirmish with the neighbor. Indian entrepreneurs are harnessing the potential of D2C with the support of government policies, strong IT Infrastructure, the aspirational lifestyle of Indians and technological advancements. Indian D2C brands are on the lists of Unicorns and IPOs too. Since 2014 to 2021, the fundings raised by D2C segment brands is approximately $2 Billion. All the trends and signs indicate green flags for the Indian D2C market.
What distinguishes traditional retail from D2C is the state-of-the-art technology empowered by data. Their system tracks end-user needs through data and feedback engagement, leveraging EQ through social media storytelling and digital marketing, bigger reach and a forecasting system. D2C brands as an ecosystem eliminate wholesalers and distributors in their supply chain through e-commerce, thereby reducing the cost for end-user and making it economic. They are available on offline retail too. They symbiotically complement the verticals of logistics, digital marketing, content creation, social commerce, influencer marketing, fintech and packaging as a part of their business ecosystem.
Technology is undoubtedly the answer to the major key factor for the growth of Indian D2C. Metaverse again changed the vision of the shopping experience. Indian retail corporates also banked on the metaverse. Interactive experience with AR and VR will add to the advancement of D2C. Since the pandemic, the number of women consumers has grown by a double-digit percentage. In the recent past, consumers have evolved and grown with market intelligence due to their access to the internet and the multiple options available. The subscription-based model has also gained acceptance, especially among women’s communities. The QR Scan payment methods, 4G and 5G technology, smartphones and influencer marketing have flourished the D2C.
D2C is no longer the future of commerce but the present. The established brands should now focus on Sustainability, 17 UNSDGs, Climate Action, Environmentalism, ESG, rural markets, going global, mergers and acquisitions and leveraging CSR. The budding startups should rely on the business intelligence of credible reports, be debt-free, plan attractive campaigns, focus on niches and develop blue ocean strategies to change the game and bring a paradigm shift.
Established brands and growing brands, both need to focus on one common parameter and an asset to reach the major audiences and that is content. Content presentation through texts, visuals, audio, video in sync with current trends add an engaging value to brands. More the engagement more the preferences that accelerate the buying propensity. The social media team, content team, creative team and ORM team need to be on their toes to leverage the opportunities. The content in local regional languages should also reach consumers across the country with an engaging appeal to reach the majority of the potential customers. Especially if you have to capture Tier 5 and rural markets, local language engagement is a basic necessity. Community building through online engagement should be a strong PR activity that needs to be planned for business engagements.
Mavens credit Technology to be the catalyst for D2C growth in India. But the truth is, India’s population which includes skilled IT Professionals, entrepreneurs, and job class and its acceptance for D2C is the major asset. India is one of the youngest countries in the world with an average age of 29. 66% of India’s population is below the age of 35. India empowers 1.15 billion mobile phone users. The scope of growth in the Indian D2C segment is promising.
Views expressed above are the author’s own.
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