India’s value e-commerce market is expected to touch $40 billion by the year 2030, as per Kearney’s report. As more people embrace online shopping, the expected growth would be a result of the increasing internet base. The report also stated that value-driven purchases would grow massively, leading to a rise in its market value.
Value-based lifestyle purchases are expected to be growing as users from tier -2,3, and 4 cities and rural areas flock towards e-commerce. As per the report, the estimates state that 62 percent of value e-commerce is expected to be driven from tier – 2 cities alone.
Currently, at $4 billion, this value is expected to grow rapidly to $20 billion by 2026 and reach the expected value by 2030, the report said. The aspirational needs of people, the rising digital footprint in tier – 3 and 4, and rural areas, and the changing perspectives of people towards buying endow a massive chance.
The lifestyle retail market, meanwhile, is likely to be at $156 billion in 2026, and reach $215 by 2030, stated the report titled, ‘Value e-commerce: the next big leap in India’s retail market.’ These included fashion, footwear, cosmetics, and small appliances, amongst others. The value in 2019 stood at $90 billion.
Mr. Siddharth Jain, Kearney’s partner said, “As retail in India bounces back from COVID, the growing number of value-conscious online shoppers is reshaping India’s e-commerce landscape. This value segment is pegged to grow rapidly and emerge as a $215 billion-plus market by 2030.”
Mr. Jain added that the value e-commerce segment would continue to perceive the proliferation of organized and unorganized Indian players alongside small sellers. He further added that almost three-fourth or 75 percent of value-driven purchases in India are of small brands.
Expecting the number of internet users would surpass 1,100 million people by 2026, Mr. Jain added that the value lifestyle consumer needs would be addressed by differential business models and online channels.
As per reports, over 70 percent of the current lifestyle retail demand is from the value lifestyle section. This segment is being dominated by the unorganized general trade standing at 80 percent share. Modern trade stood at 16 percent, while e-commerce stood at 4 percent penetration. By 2030, the report forecasted that the unorganized general trade would stand at 57 percent share, and the e-commerce and modern trade are expected to have 19 percent and 24 percent shares respectively.
The report also stated that most value lifestyle customers spend significant time in finding and evaluating the products, owing to their strict budget constraints. Also, these customers scout for different deals and often purchase at huge discounts said the report.
Kearney’s report also briefed the efforts by several e-commerce firms like Snapdeal, trying to align with this value-conscious segment. The report emphasized how Snapdeal has revamped its e-commerce positioning by shifting its entire focus upon the value lifestyle. Mr. Karan Dhall, Kearney Partner stated that such online players focusing on the relevance of needs would emerge as strong contenders to grab the predicted market share.