Social media, live video, group buying the next important frontier for ecommerce: BCG-Matrix report
With consumers spending more time on social media and live video, these formats are poised to attract new users to online commerce, according to a report by BCG and Matrix Partners
Thursday April 06, 2023,
2 min Read
Online commerce is set to benefit from newer formats like social media, live video, and group buying as consumers are willing to move beyond traditional channels like websites and shopping apps.
Time spent by consumers on social media and photo-video apps like Instagram and Facebook has increased 1.8x in the last three years, making these channels not only lucrative but also the next frontier for online commerce, according to a report by BCG and Matrix Partners.
The report, titled 'Digitizing Consumers in India' and co-authored by consultancy firm BCG and early-stage venture capital firm Matrix Partners, highlights that new commerce models such as assisted and conversational commerce, influencer commerce, live/video commerce and group buying could provide an impetus to existing and new shoppers.
While categories such as electronics, appliances, fashion, and apparel have high penetration, the next wave of growth is likely to be driven by beauty and personal care, and food and beverages, FMCG, and furniture, and décor. The key demographics leading the wave are expected to be consumers aged 35 and over, women, and those from Tier II cities, the report said.
The consumer-tech space has seen value creation of more than $250 billion over the last decade with over 40 unicorns emerging in the space, validating the importance of the sector. Moreover, India holds a significant spot in the global consumer landscape with startups logging a higher number of deals than China and Southeast Asia in the last five years.
Other key trends shaping ecommerce include marketplaces overtaking mainstream search engines, increasing awareness and affinity for sustainable products, and growing acceptability for second-hand goods and recommerce.
Emerging technologies like Generative AI and Open Network for Digital Commerce (ONDC) have catalysed broader public interest in consumer tech, the report stated. "ONDC is slowly gaining traction across ecommerce and mobility, with other use cases currently under various stages of implementation," the report stated.