$250 billion opportunity for digital-first brands by 2030: Redseer

Online retail has grown sustainably during the pandemic and proven to be a lifesaver especially for smaller cities, according to a report released by RedSeer. It is a $250 billion opportunity for digital-first brands by 2030, it added.

In fact, India's e-tailing GMV reached $53 billion in CY21, demonstrating post-Covid acceleration. Additionally, Indian e-tailing showed impressive q-o-q growth in 2021 while other global players struggled to maintain the momentum.

"Indian e-tailing has entered a different ballgame, where online retail continues to grow rapidly and a new brand of online shoppers are demanding new retail channels such as social and video commerce, revolutionising the industry. This has paved the way for a $250 billion opportunity for digital first brands," it said.

As per the report, India will be adding hundreds of millions of new online shoppers in the next few years –primarily the segment that is outside of the big cities, have lower incomes and shop in a very limited manner.

To address their needs, social and video commerce is creating a new retail channel for an aspirational new India, this is already supported by over $1 billion funding in 2021. Video commerce, powered by multiple models, has massive potential in India. In India, several platforms have already started to disrupt consumer purchase patterns with video commerce, the report said.

With massive unicorn and ‘soonicorns’ creation in digital first brand space plus a surge in IPOs, 2021 clearly was the year for digital-first brands, and the same can be said for this year, too, where we will only witness an upward spiral.

‘Offering quality products’

Many of these new-age digital first brands are changemakers as they are offering quality products at affordable price points that are not served well by most traditional brands; many of them are also offering truly innovative products that are changing how we as consumers interact with brands.

They are constantly looking to improve their offerings through exploring new channels and business models to better serve customers in the digital space. This helps them stay relevant in an ever-evolving digital landscape.

Consumers have been highly receptive to these digital-first brands, as per the report. The findings further suggest that consumers opt for these new age brands for their quality (and not only price) with significantly high repurchase willingness.

Multiple $100 million revenue technology-first brands have been created already across the categories in just the past few years, with each having a unique winning playbook and first-of-their-kind business model. Over the 2021-30 period, we expect many more digital-first brands to scale exponentially, supported and incubated by roll-up platforms that are building the next wave of digital-first brands for India, the report said.

‘Rewarding to engage with consumers’

This will be enabled by the growing trend of digital-first consumers who are willing to try and adopt new brands at a faster pace than traditional consumers. This trend is expected to drive the rapid scale-up of digital-first brands, with some achieving a market capitalisation similar to that of major traditional brands in India in just a few years.

During a recently conducted event by RedSeer, Ground Zero 6.0, Mrigank Gutgutia, Associate Partner, RedSeer, said, “The current B2C retail landscape is evolving rapidly with the emergence of new consumer behaviors and expectations. The rise of new retail channels, particularly video and social commerce, is further changing the way consumers shop and what they expect from brands. As a result, digital first brands are finding it increasingly rewarding to engage with consumers in these channels and offer them a seamless, omnichannel experience. The success of such brands will depend on how effectively they leverage these new retail channels and how they innovate on the digital front to offer a superior omnichannel experience”.

COMMENT NOW