Rising Star Awards 2023- Winners

Best Media Info

Special
Interviews
Events
Misc
Partner Content
BuzzInContent

‘Mass consumers’ to drive more than 45% of $300 Bn eComm opportunity in India by 2030

Redseer’s survey results suggested that around 70% of mass consumers (people with an average annual income ranging from Rs 2.5-10 lakh) have increased their shopping frequency on eCommerce platforms in the last one year

As of 2022, India has 65-70 million households transacting on eCommerce platforms monthly, which is projected to go up to 120-130 million by 2030, with mass consumers contributing to more than 80% of the incremental transacting households, according to Redseer’s latest report.

In terms of GMV contribution as well, mass consumers are projected to drive approximately US $1.3 trillion in the overall Indian retail market and more than 45% of the US $300 billion eCommerce opportunity in India by 2030, mentioned the report.

In a detailed survey conducted across Metros, Tier 1, and Tier 2+ cities with the target group involving Gen-Z, millennials, and Gen-X shoppers, Redseer uncovered shopping patterns of different consumer cohorts and shed light on predominant purchase factors.

As the report puts it, the ‘affluent’ consumers on the survey are a cohort with an average annual income greater than Rs 10 lakhs. The ‘mass’ consumers make between Rs 2.5-10 lakhs annually, while the ‘strivers’ are a third cohort who earn less than Rs 2.5 lakhs a year.

Breaking down the cohort by demographics, Redseer analysts found that approximately 75% of the mass consumers comprised of millennials and Gen-Z consumers. While Gen-Z, who are young and independent, show purchase preference for apparel, BPC, and electronics, the value-driven independent millennials tilted towards BPC, food & grocery, and apparel. Gen-X constituted about 13% and spent a higher share on food and grocery, followed by health and wellness. Although Gen-Z consumers have distinct characteristics from older generations, they are also value-conscious at the core, the report adds.

The report by the strategy consultants projected that growth in India’s retail market would play out differently across these consumer cohorts in the coming decade, with the mass consumers expected to lead spending on the Indian retail market.

As of 2022, mass consumers constitute around 53% of the Indian retail market, valued at US$ 950 billion. According to Redseer’s projections, this share is expected to grow at a CAGR of 12% to touch near 65% by 2030, making it a US$ 1.3 trillion opportunity for brands and businesses. The remainder of the projected US$ 2 trillion retail market value is expected to be occupied by strivers and affluent consumers, growing at a CAGR of 8% and 5%, respectively.

Examining the themes playing out across consumer cohorts, Redseer found that online wallet share expansion will be the key theme playing out amongst mass consumers led by their high-value consciousness across categories and the increasing use of the internet across their purchase decision-making journey, wherein, mass consumers are almost as online savvy as affluent consumers.

“These consumers are comfortable with technology, willing to try new products/brands, are increasingly shopping online across categories, can afford products available on eCommerce websites, and are adopting digital payments for smoother transactions.”

Redseer’s survey results suggested that around 70% of mass consumers have increased their shopping frequency on eCommerce platforms in the last one year.

A recurring theme across the survey, when it came to online shopping, was seeking value at the right price. The top three decision drivers while making purchases included prices/deals and discounts on eCommerce platforms, quality of products, and trust in the platform. Further, the survey indicated that more than 60% of mass consumers were open to purchasing unbranded products if they liked the quality, while approximately 30% of mass consumers preferred unbranded over branded products.

According to the Redseer report, within the USD 15-20 Bn mass eCommerce segment (in 2022), 60-70% of the sales were led by large horizontals. While the rest 30-40% of sales were led by players who had a specific focus on solving for and expanding the mass consumer segment – this includes platforms like Meesho (which grew by focusing on better regional and local selection and pricing) along with verticals platforms like Purplle (BPC category) and then the longer tail of smaller verticals and horizontals.

The mass consumer-driven offline retail market has also seen a few successful business models. Amongst offline retailers, there is Zudio (in fashion) which has outperformed the industry over the past 3 years, along with other players like DMart, Reliance Trends, VMart, amongst others across the categories. In China, there is Pinduoduo, which has been growing aggressively by catering to the mass segment as well on the e-commerce side.

Info@BestMediaInfo.com

Advertisment
Post a Comment