According to the UnivDatos, growing investments in the expansion of consumer goods sector is anticipated to assist the growth scenario of the “India D2C Market” report; the India market was valued at USD 16850 million in 2023, growing at a CAGR of 39% during the forecast period from 2024 - 2032 to reach USD million by 2032. 

Tier-2 and Tier3 based market expansion:

The emergence of the Tier-2 and Tier-3 city expansion is a key strategy for brands looking to increase their chances of capturing a growing-cast middle class outside metro arteries in greater India. Almost all D2C brands have convergence of some kind on the big-three metros of Delhi, Mumbai, and Bengaluru, but here lies a vastly untapped space where disposable income is increasing the capacity for internet penetration and e-commerce.

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These Tier-2 and Tier-3 cities offer such new unique grounds on which to build consumer bases as their increasingly tech-savvy, young user segment, coupled with changing uses by customers. Having shifted from having real-time access to smartphones and cheap data plans to almost-matching up for cash transactions, the consumers in these markets are now very much inclined to shop online. All these create a perfect environment for the growth of D2C businesses. Different supply categories that are witnessing growing demand in these areas include fashion, electronics, health and wellness, and home decoration, with local consumers becoming increasingly attracted to the modern and premium offerings.

Growing Demand and Industry Trends:

Access to digital payment systems has been the actual game changer for D2C markets in India, especially Tier-2 and Tier-3 cities. With more individuals owning smartphones that have internet service provision, they subscribe to online shopping more with the digitization of payment platforms such as UPI (Unified Payments Interface), Paytm, Google Pay, phone wallets, etc. In fact, these platforms have eased cashless transactions making it easier for customers living in smaller towns to make purchases online.

The online payments in India has significantly jumped in recent years due to which there has been a major support to the D2C companies. For instance, Ministry of Finance, India, the total digital payments in December 2022-2023 were 13,462 crore as compared to 2,071 crore in year 2017-18.

Thus, for the D2C brand, the advent of digital payments has removed most barriers to online shopping, such as cash on delivery (COD) or little banking access. This would lead to smooth and fast transactions that are crucial for the seamless customer journey. Furthermore, the growth of digital payment systems also results in a more secure and transparent payment environment with less risk of fraud or payment disputes.

As India goes digital on payments, so D2C would be able to use these infrastructures to push into a more under-penetrated or shallower market. This means that D2C brands can put up a wide array of payment options from credit and debit cards to mobile wallets and UPI to capture as many customers as possible. Not just for flexible and immediate payment options, but it can create happy customers, leading them to repurchase from the brand in the long term.

In other words, access to digital payment systems has been an enabler for scaling D2C markets, in all Indian cities, it makes life easier, and safer and gives more faith in shopping online.

Upcoming Trends Assisting Market Growth:

Additionally, the growth of ecommerce has substantially supported the D2C business across the country as companies have gained major prominence through these channels. Ecommerce websites as Amazon, Flipkart, Myntra, etc., provide wide variety of products and offer wide range of offers through payment solutions with discounts. Additionally, the speedy delivery process of the products to pan India has also benefitted the companies to expand their reach to a wide number of customers. Furthermore, the emergence of quick commerce services in Tier-1 and Tier-2 cities have also provided ample push to the D2C companies as quick delivery in 10-20 minutes of electronic goods, apparel, healthcare product, pet products, etc., expand the sales of the companies.

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Considering all the major changes in the country the demand for D2C is further anticipated to rise during the forecasted years. As the number of customers using internet of product purchase and making purchase decisions through social media marketing and availing speedy delivery of goods in lucrative pricing the D2C companies would emerge as key market participants in consumer goods category in India further translating into the growth of D2C market in India during 2024-2032.

Conclusion:

In conclusion, the North India D2C market reflects a dynamic and evolving landscape supported by government investment, industry collaboration, and technological innovation. As the demand for online delivery of goods with the growing disposable income and ease of online payment is rising the D2C brands in India will experience a rapid growth in terms of revenue growth.

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