Moneycontrol
Feb 15, 2018 05:29 PM IST | Source: PTI

Digital consumer spending in India to grow to $100 bn by 2020: Report

The report also said that women and new users from non-Tier 1 cities will drive this growth.

Digital consumer spending in India is expected to grow 2.5 times from USD 40 billion to USD 100 billion by 2020, said the report of Boston Consulting Group (BCG) and Google on Thursday.

The growth is expected to be led by sectors such as e-commerce (USD 18-45 billion), travel and hotel (USD 11-20 billion), financial services (USD 12-30 billion) and digital media (USD 200-570 million).

The report also said that women and new users from non-Tier 1 cities will drive this growth.

"There is a clear evolution as consumers move from awareness of online platforms to their first purchase and further down to become more frequent buyers- triggers and barriers to online purchase evolve with each stage. Very different actions are needed to unlock growth and move consumers from one stage to the next, "said Nimisha Jain, Partner and Director, The Boston Consulting Group, India.

The report also highlights that there is 76-80 percent internet users who do not spend online currently. This underscores that even though the digital media has gained ground over the last few years, the actual digital spending is still in evolutionary stages in India.

Nitin Bawankule, Industry Director, Google India said, "The ecosystem needs to focus on creating a very targeted value proposition for a different segment of users and across different categories to drive larger adoption. For example, in food and grocery category, convenience becomes a key trigger for frequent shoppers while discounts are important for occasional shoppers and quality is a key barrier among offline shoppers.”

It calls out specific actionable insights for different sectors to drive adoption among the non-buyers. For the price conscious Indian users, discounts can be a good trigger to drive trials and building comfort with digital and guiding them along the purchase pathway.

For frequent shoppers, comprising of 15-25 percent, it is imperative to create unique propositions like loyalty programs and develop customised communications to drive stickiness.
Sections
Follow us on
Available On