DBT Bureau
Bengaluru, 7 August 2024
India’s online lifestyle market is set to reach $40-45 billion by 2028 from the current size of $16-17 billion on the back of rising demand, a joint report released by management consulting firm Bain & Company and fashion marketplace Myntra said.
According to the report, India’s $130 billion lifestyle market with fashion accounting for around 80% and the rest comprises beauty and personal care, is expected to grow at 10-12% CAGR to touch $210 billion over the next five years.
The growth in the online lifestyle market will get supported by the easing of short-term inflationary pressures, combined with structural and favourable demand shifts, such as a rise in income, growth of fashion-forward, digital native Gen-Z shopper base as well as an increase in demand for branded products, the report said.
Superior customer value propositions of trendy selection, faster delivery, easier returns, tech-enabled purchase journey, social media-powered discovery and omni-access will also support this growth, it added.
“India’s e-lifestyle market has come of age in the last few years, with a diverse shopper base – 2 in 3 online shoppers are from beyond top 50 cities, 1 in 2 are from non-affluent segments, and 1 in 3 are Gen-Z. There still exists massive penetration headroom. 1 in 5 dollars spent on lifestyle will be online”, said Shyam Unnikrishnan, Partner atBain & Company.
Currently, fashion constitutes 75% of online lifestyle market. Within fashion segment, accessories and women’s apparel is likely to grow faster than other items.
In 2023, more than 175 million customers across India shopped for lifestyle online, transacting 6–7 times annually on average. For 40–45 % first-time e-commerce shoppers, lifestyle is their first purchase, thus becoming a key gateway category for e-retail. These online shoppers are visiting more platforms and visiting them more often; these shoppers are also completing purchases over a shorter duration, the report noted.
“The 60 million Gen-Z shopper base transacts more frequently but spends lower per order. These fashion-forward, digital natives account for 25% of the e-lifestyle market, at $4 billion e-lifestyle GMV. New-age insurgent brands have seen 2X higher adoption among Gen-Z. In order to win Gen-Z, it is critical for brands to cater to their needs and preferences by offering an affordable and trendy assortment, highlighting authenticity in brand positioning, tech-led shopper journeys, and active influencer endorsements,” the report said.
India already houses 90% of the top 50 global brands with half of these brands having over $30 million in revenue from India operations. Over 60 global brands have been introduced in the last 12 months.
“Three in five global brands have entered India via the online channel in the past year and we are proud to have contributed to the launch of some of these global brands in the country. A well-rounded and high-decibel launch, facilitating easier discovery, access to intel about the needs of Indian fashion-forward consumers and Myntra’s reach to 99% of serviceable pin codes are among the key factors enabling the scale-up of the global brands in the sub-continent”, said Nandita Sinha, CEO, Myntra.
