The fashion market in India is estimated at $70 bn in 2016, with $7-$9 bn already digitally influenced, and the market is projected to rise to $30 bn, which will be equivalent to 60-70 per cent of the total branded apparel market, according to a recent report. E-commerce constitutes 4-5 per cent share of the overall fashion market in 2016.
As per the report by Boston Consulting Group and Facebook, titled ‘Fashion Forward 2020’, online purchase for the fashion category is estimated to grow by four times to reach $12-$14 bn by 2020. This growth will be driven by a spurt of new shoppers as well as a maturing shopper base that spends a larger share of their fashion wallet online. The number of online fashion shoppers will double from 55-60 mn to 130-135 mn by 2020, with a significant shift in the user profile, says the report. Close to 50 per cent of online shoppers by 2020 will be women, over 50 per cent will be from tier 2 or smaller towns and 37 per cent of them will be over 35 years of age.
“The single largest challenge for driving e-commerce will lie in the ability to mirror the touch-and-feel element of physical channels. For more evolved shoppers, faster delivery and assurance of fit will also be important,” adds the report. About 25 per cent of all transactions by online apparel shoppers are conducted entirely online. In the future, this is expected to rise as consumer confidence in online shopping increases. In addition to this, a third of all transactions use a mix of both online and offline touch points in the journey.
The report also says that consumers are increasingly spending more time on digital media, engaging with brands directly as well as following influencers and trendsetters. The shift in media spending towards digital has begun, but there is further scope as brands and department stores currently spend only 10 – 15 per cent on digital media advertising. Going forward, digital will become central not just to the way brands are marketed and sold, but also to product design, plan merchandising and customer engagement.
