Indian retail market pitted as the world’s largest is projected to surpass the $1.7 trillion mark by 2025, stated Avendus Capital report, piggybacking on its e-tail market leading the shift. Looking at the immense opportunities, many D2C brands have emerged in India.
COVID-19 pandemic has acted as a catalyst in pushing online adoption amidst incessant lockdowns and growing public anxiety towards visiting public places. The online economy of India is expected to grow at a CAGR of 35 percent plus from $39 billion today to $200 billion by over the next five years, buoyed by Internet and payment infrastructure developments.
D2C Brands Connecting better with customers
In 2021 many D2C brands have raised a substantial amount of funding. The future looks bright for D2C as startups that have raised funding this year are poised for growth and advancement.
On the other hand, companies like boAt, Wow Skin Science, MCaffeine, and Wakefit have been profitable from the very beginning. Their Profit and Loss statement shows a definite return on investment and growth path.
D2C brands have been quick to scale their product portfolio and launch new products as per consumer trends. Typically, traditional brands have taken 12-16 months to launch a product through various internal policies and bureaucratic chains, whereas D2C brands can go from ideation to final product in less than 4-6 weeks.
D2C’s Quick to Scale Ability
The country has more than 600-plus direct-to-consumer (D2C) brands. It is expected that the addressable market size for this industry will be $100 billion by 2025, fueled by the 63 crores strong internet population, growing at 24 percent. India added 80 million shoppers in the last three years alone to reach 130 million.
D2C model witnessing a surge in popularity
The acceptance of e-commerce, payment and logistics providers development has grown significantly over the last few years. With a fast-growing middle-class population in India and the ability of D2C brands to penetrate underserved markets with differentiated offerings, D2C brands are disrupting the retail segment in India.
Post-COVID, consumers who were left a harried lot prying for safety and convenience have found solace in choosing to shop on e-commerce platforms and online D2C channels, which has widened the growing opportunity for D2C brands.
With a growing middle class in India and faster adoption of Internet commerce, D2C brands have been able to tap on the market opportunities present in Tier II & III cities. The pandemic came as blessing in disguise only to accentuate the reach of this sector. The first half of 2021 is witness to this change as a substantial funding has gone into the D2C market segment.