India has proven to be the fastest growing market for the e-commerce sector. The Indian e-commerce market is expected to grow to $200 billion by 2026. Propelled by online digital transformation, increasing internet and smart-phone penetration, the market has witnessed tremendous growth.
The online gifting industry is one of the contributors to the growth of Indian e-commerce space and is set to take a larger pie in the overall market in the coming future. The global gifting market is estimated to be $475 billion, and India is expected to emerge as one of the most influential contributors by 2024.
India is all set to jump from the current online gifting market of $65 million to $84 billion by 2024, according to the latest research by ‘Qwikcliver’. The long-term growth perspective for India’s online gifting market remains robust. There is emergence of newer players, encouraging changes and innovation in the environment and a mind-shift wherein online gifting will take centre-stage.
Over the last decade, the market witnessed steady growth in the digital gifting market in India, courtesy rising income levels and economical gifting options boasting extreme creativity. Past two years have proven to be landmark years when it comes to the personalised gifting category making it desirable gifting choice amongst Indian consumers. The online gifting market has two segments - Corporate and personal with the share division being 80 percent and 20 percent, respectively. Moreover, the corporate sector in India alone is worth Rs 12,000 crore, and is growing at over 200 percent per annum. Personalised gifts are customer-centric, adhering to preferences and choices of the recipient.
A personalised gift is primarily curated for your dearest ones for their special days, not just materialistic but wrapped with emotions and affection. This rising trend of personalised gifts has augmented the entire online gift industry. A large number of Indian consumers is now technologically updated and look forward to receive optimal services that are convenient and economical. Surging consumer aspirations also mean people expect to make the gifts personal by adding exclusivity factor to it. Tailor-made products account for over $20.4 billion in the industry, and this is just the beginning, the prices are set to rise by $31.6 billion in the coming years.
The market is more comprehensive now in comparison to how it was a decade ago. The industry is witnessing emergence of several online players which is diversifying the whole sector. It marks a beginning to an eventful journey and it is expected to have positive impact to the landscape of online gifting market in the e-commerce ecosystem. There is a swarm of online gifting players with many newer entrants who are offering personalised services, tailor-made options which is not just adding value to the segment, but also enhancing service experience.
Newer players are betting on customers wish-lists and registering online gifting whereas some existing players in the ecommerce market have their stakes in experiential gifting like travel cards, spa days, gift cards, home décor, gadgets and more. However, personalised gifts are indissoluble and much more enduring.
Personalization will be a big part of online gifting industry moving forward. Factors that have modernised online gifting in India:
1. New-age consumer: Working professionals and millennials within the age group of 25 - 35 years, are tech savvy, upwardly mobile, discerning, and usually running on a time crunch due to their busy schedules are some of the key characteristics of our new-age consumer. They prefer the instant, one-stop shop and mobile concept of online gifting segment for its efficiency quotient. Additionally, the luxurious and modern lifestyles have impacted gifting culture and habits, making gifts a token of love.
2. Intuitiveness, uniqueness and innovation factor of personalised gifting: Over the years, our consumer base has become extremely conscious when it comes to selection, quality, customisation and uniqueness of personalised gifts. From plants to pets, online gifting market has captured every possible aspect to woo its customer and enhance stickiness, loyalty and sense of credibility to its business. From business aspect, the personalised gifting market has added over 15-20 percent in term of profitability for each play.
3. Emerging corporate gifting market: Corporate gifting market has the larger share in the overall online gifting market. The Average Order Value of the category has increased by $78 in 2017 to $82 in 2018, as per Edison Trends. Repurchase rate of such users is around 50-60 percent, which is also significantly higher. This transition is visible in the market, and the e-gifting industry has been innovating with a tailor-made gifting space. Moreover, as per the market research, regal collections with customisation for flower arrangements for CXOs and other dignitaries living in other cities is in high demand.
4. Seamless customer experience: Indian companies have a lot of scope towards enhancing the online buying, delivery and service experience. Online shopping as a principle is the most demanding function in the e-commerce industry. The customer has a small attention span and a plethora of options, players or website to scan through. Each brand has a huge challenge to ensure superlative experience from the first click from proving a large pool of options, easy navigation, and attractive imagery, right pricing and clear description to the last thread that is; doorstep delivery, every stage has to be seamlessly immaculate and instant.
5. Prompt 24x7 online delivery options: Late night and last-minute surprises with delicious cakes, beautiful bouquets, chocolate boxes, and customised gifts are indeed special. The online-gifting business focuses more on last-minute realisations, midnight deliveries, quality of products and services. Anyone can now customise the date and time in accordance with the occasion. Customized gifting is also in line with the philosophy of thoughtful gifts. E-gifting shops are taking it a notch higher with a “same-day” delivery concept in the future.
6. Green gifting: Gifting plants is an upcoming trend in the e-gifting market. Today’s shoppers prefer long-lasting and more meaningful gifts like plants instead of disposable gifts. Customers can choose from indoor plants, air purifying, medicinal, succulents, flowering plants, etc. Lucky Bamboo and Bonsai are good luck charms, and an excellent option to gift to your loved ones. Moreover, plants are a good stress reliever and promote healthy surroundings.
7. Technology and Data Analytics: Finding the perfect gift for a loved one could give even the savviest shopper some anxiety. Now-a-days, gift-giving platform, use AI to help corporate to find the perfect gifts for clients, managements and employees. Data analytics and Artificial intelligence is also infusing repeatability and ensuring stickiness of a consumer to select appropriate gifts, timely reminders, best offers, time saving actions like delivery addresses, names etc. On an average over 30 percent consumers selects same portals to buy gifts for occasions and festivals when it is combined with services like, loyalty points, birthday and anniversary reminders, selection of picks by featuring products similar to consumer’s choice.
8. Evolution of digital marketing: India has over 300 million social media users as per 2018 statistics. Social media platforms are the key to digital marketing popularity and success. Promoting products on social media like Facebook, Instagram, LinkedIn, Pinterest and Twitter help get the maximum visibility of online products. Exciting offers and deals create an immediate buying urge.
(Edited by Suruchi Kapur- Gomes)