$30bn of fashion market to be digitally influenced by 2020
Nearly $30 billion of the domestic fashion market, which currently accounts for 70 percent of the branded apparel market, will be digitally influenced by 2020, according to a report.
Of the approximately $70 billion Indian fashion market today, about $7-9 billion is already digitally influenced. This influence is expected to multiply nearly four times to reach nearly $30 billion by 2020, a joint report by Boston Consulting Group and Facebook, titled 'Fashion Forward 2020', said.
It noted that all this digital transformation is happening on the mobile with as many as 85 percent online apparel shoppers preferring mobile over any other device. The report also reveals that fashion is the first category that most people buy online, with nearly 30 percent of new shoppers likely to start buying online with apparel and footwear.
Fashion e-commerce today is already sizable, at 4-5 percent of the total fashion market, and is comparable to sales from department stores put together, the report pointed out.
Online purchase for fashion category will multiply nearly four times to reach $12-14 billion by 2020 accounting for a significant 11-12 percent share of Indian fashion market, it said. Forty percent of this growth will be driven by a spurt in new shoppers, while the remaining will be driven by maturing existing shoppers.
Rohit Ramesh, Partner and Managing Director, The Boston Consulting Group, India said,
The spurt of new fashion shoppers will bring with it a fundamental shift in the profile of online fashion shoppers. By 2020, nearly half the shopper base will be women, more than 50 percent will come from lower tiers (Tier II or even lower), and nearly 37 percent will be older than 35 years of age.
A key finding of the report is around the interplay of online and offline channels in consumer paths to purchase. Mobile has become central not just to the way brands market and sell, but also how they design products, plan merchandising and engage with customers end-to-end," Umang Bedi, Managing Director, Facebook India & South Asia said.
The report also looks into how the changing face of the fashion consumer change online purchase behaviour. Consumers are increasingly going online to discover the latest trends, designs and get to know about brands. A quarter of all transactions by online apparel shoppers are conducted entirely online, the report noted. It also calls out for the need for shift in media spending by brands and retailers towards digital.