Despite the stress faced by the Indian rupee and the rising crude oil bill, Indiian retail market would grow at a CAGR of 7.8 percent between 2021 and 2026.
E-commerce will be the engine of the next level of Indian consumer growth beginning this year, said a report by Deloitte India and Retailers Association of India.
The report pegs the India's ecommerce marketplace at $200 billion and is poised to grow to $1.2 trillion by 2021.
Deloitte’s 2019 consumer business focused report titled 'Unravelling the Indian Consumer', was released on February 26 at Retailers Association of India Summit in Mumbai.
According to the report, currently, India’s e-commerce marketplace is growing at CAGR of 32 percent and is expected to further rise as the e-commerce space grows at a massive pace, boosting the overall consumer segment growth in the country.
Some of the factors listed out in the report which attribute growth projection include changing purchase patterns.
With increasing internet penetration in India, online buyers are rapidly increasing.
Moreover, m-commerce is growing at an exponential pace as m-wallets transactions in India increased from Rs 200 billion in FY16 to Rs 3,000 billion in FY18.
The report pointed out that high intensity online shopping pattern and heightened use of smartphones, given the increase in internet penetration across the semi-urban and rural segments, has boosted the sales outcome.
The millennial population of India has mostly championed this trend across tier-1 , tier-2 and tier- 3 markets, the report said.
Interestingly, social-commerce in India has been on the rise.
According to the report, 28 percent millennials purchase products due to social media recommendations, and 63 percent millennials stay updated on brands through social media.
"India continues to hold a strong position as far as its market potential is concerned and is on its way to becoming the third largest consumer market in the world, poised to grow close to $1.2 trillion by 2021," said Anil Talreja, Partner, Deloitte India.
He further added that the Indian consumer is truly empowered with the decision-making capability and adoption uptick going beyond the urban areas. This will be further facilitated by digital technology.
Moreover, use of innovation by way of offering experiential retail has picked up of late with the use of advanced data analytics, bots and drones, beacons, cloud-platforms, AR and VR to understand the real need of the consumer.
"This further shows the maturity of business and the solid platform existing in the country for all types of market players such as consumers, distributors, logistics service providers and development of the ancillary sectors including transportation, logistics, cold chain facilities, etc., that will help India consumer business to the next level of growth," Talreja added.
The Deloitte report emphasises that despite the stress faced by the Indian rupee and the rising crude oil bill, Indian retail market would grow at a CAGR of 7.8 percent between 2021 and 2026.