 "Indian fashion e-commerce to grow four-fold to $30 bn by 2020: Study")
India's online fashion commerce market is expected to grow four-fold to $30 billion (nearly Rs 2 lakh crore) by 2020. And, two of every three products sold would be branded apparel, says a study by The Boston Consulting Group (BCG) and Facebook.
Currently, $7-9 bn of the $70 bn India fashion market is digitally influenced. All this digital change is happening on mobile phones, with as many as 85 per cent of online apparel shoppers preferring this over any other device.
The joint study says it expects fashion to be the first category that most people buy online by 2020. And, that almost 30 per cent of new shoppers are likely to start buying apparel and footwear online.
Currently, online fashion portals account for four to five per cent of the total fashion market, comparable to sales from department stores put together. The report says this will increase to 11-12 per cent by 2020, multiplying nearly four times to $12-14 bn. Also, around 40 per cent of this growth will be driven by a spurt in new shoppers.
"The 2020 shopper will no longer be the typical young, metro-residing male of today. By 2020, nearly half the shopper base will be women and more than 50 per cent will come from lower tiers (tier-2 or even lower); 37 per cent will be older than 35 years of age," said Rohit Ramesh, partner & managing director (MD) of BCG in India.
There will be a change in what drives the online purchase. The current driver is discounts, which will pivot into variety and convenience. Women and lower-tier shoppers, for example, are driven more by variety; older shoppers care more about convenience.
"This report clearly lays out a pivotal role for digital in the fashion industry. This trend is spreading across geographic and demographic segments. By 2020, 33 per cent of all urban fashion consumers will buy online. Which means for a mobile-first country like India, we will witness a high number of purchases taking place on the mobile," said Umang Bedi, MD for India and South Asia at Facebook. "The mobile has become central not only to the way brands market and sell but also how they design products, plan merchandising and engage with customers end-to-end."
The research also says consumers are increasingly going online to discover the latest trends, designs and brands. A quarter of all transactions by apparel shoppers are conducted entirely online. As consumers gain more confidence in online shopping, this will rise.
