New Delhi [India">India], Feb 15 (ANI): Capturing the growth of digital influence and key consumer insights that will drive the next phase of digital consumer spending in India">India, Boston Consulting Group (BCG) and Google India">India today released a report, Digital Consumer Spending in India">India: A USD 100 billion opportunity.
The report projects that the potential for digital spending is expected to grow 2.5 times from ~USD 40bn to ~ USD 100bn by 2020 led by sectors such as Ecommerce (USD 18-45bn), Travel and Hotel (USD 11-20bn), Financial Services (USD 12-30bn) and Digital media (USD 200-570mn). The report also finds that women, new users from non-tier I cities and 35+ years shoppers will drive this growth.
The report states that with deeper penetration of mobile phones and affordable data plans, the number of online spenders will not only increase over the next few years but there will be a dramatic change in the users profile.
It also estimates that by 2020, the women shoppers will increase 2.5x and older shoppers will increase more than 3x compared to today. With the improvement of infrastructure, online shopping will take off in India">India from cities beyond metros and together it is expected to comprise more than 50 percent of the total online shopper base by 2020.
"There is a clear evolution as consumers move from awareness of online platforms to their first purchase and further down to become more frequent buyers - triggers and barriers to online purchase evolve with each stage. Very different actions are needed to unlock growth and move consumers from one stage to the next," said partner and director, The Boston Consulting Group, India">India, Nimisha Jain.
The report highlights that there are 75-80 percent internet users who do not spend online currently. This underscores that even though the digital media has gained ground over the last few years, the actual digital spending is still in evolutionary stages in India">India.
The BCG- Google report also outlays the key triggers and barriers at each stage of online consumer evolution with an aim to help drive digital spending. The report draws out implications for companies across each stage, with nuances highlighted to give a category perspective of relevant implications.
"Digital spending in India">India are at a cusp of significant wave of change, while we have seen enthusiastic response to adopting newer forms of digital payments in the last few years, the base is still relatively small. The ecosystem needs to focus on creating a very targeted value proposition for different segment of users and across different categories to drive larger adoption. For example, in Food and Grocery category, convenience becomes a key trigger for frequent shoppers while discounts are important for occasional shoppers and quality is a key barrier among offline shoppers," said Industry Director Google India">India, Nitin Bawankule.
The report calls out specific actionable insights for different sectors to drive adoption among the non-buyers. For the price conscious India">Indian users, discounts can be a good trigger to drive trials and building comfort with digital and guiding them along the purchase pathway.
Among occasional shoppers, which comprise of 75-85 percent, value added services will be the key differentiator - innovative delivery models, delivering a real value proposition (over and above deals/discounts) and ensuring hassle-free post-sale service. And, for 'Frequent Shoppers' comprising of ~15-25 percent, it is imperative to create unique propositions like loyalty programs and develop customized communications to drive stickiness.
The report also highlights nuances in implications across product categories (like Fashion, Durables etc.), service categories (like Travel and Hotel, Financial services etc.) and content and information categories (like OTT, Real Estate, Job search etc.). (ANI)