State of Ecommerce in India Q3 2022
Table Of Contents
India’s Digital Economy In A Nutshell
4
India’s Startup Economy: A Snapshot
5
Indian Ecommerce Market: A Snapshot
6
Ecommerce Market Opportunity In India
9
Ecommerce Startups: The Funding Funnel
The State Of Ecommerce Unicorns & Soonicorns
The List
Revenue Analysis
34
Ecommerce Startups On The IPO Ladder
Listed IPOs
Upcoming IPOs
Indian Ecommerce Market: Key Statistics
7
10
25
37
Most Active Ecommerce Investors In Q2 2022
38
Infocus: D2C
Indian D2C Startups: Key Statistics
India’s Ecommerce Landscape: Key Segments & Startups
India’s D2C Landscape: Key Segments
11
India’s Ecommerce Ecosystem Q2 2022: Key Highlights
13
Ecommerce Startups that Bagged Biggest Funding Rounds In Q2 2022
15
Notable acquisitions in India’s Ecommerce Space In Q2 2022
16
India’s Ecommerce Ecosystem: Funding Trends
Funding Trends
MoM Funding
Financial Performance Analysis
Evolution Of D2C In India (Lifecycle graph)
Category Deep Dive In D2C
India’s D2C Startup Landscape
Average Ticket Size
61
Early Stage D2C Startups Making Waves
Sectors With Maximum Funding
70
Survey: India’s D2C Founders
90
Key Challenges For D2C Brands In India
91
Ecommerce Trends To Watch Out For
Stagewise Analysis
Top Hubs For Ecommerce Funding (Tier-1 andTier 2 & Above)
Mergers & Acquisitions
3
State Of Indian Digital Economy
1,343
1,310
1,273
1,132
1,186
1,134
1,075
1,008
932
1,000
846
Internet Users (Mn)
1,500
1.3 Bn+
61%
44%
Internet Users
By 2030
Internet Penetration
In India
Increase In Internet
Users From 2022 To
2030
$0.68
4.7 Hours
305 Mn+
Per GB Internet
Cost In India
Average Hours Spent
On Mobile Per Day
Per User
Users Doing Online
Transactions In
India
110 Bn+
$2.3 Tn+
373 Mn+
Total No. Of UPI
Transaction As On
July 2022
Total Value Of UPI
Transactions As
On July 2022
Estimated Rural
Internet Users In
2022
500
0
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Source: Statista, NPCI, Bain & Company, App Annie
4
Indian Startup Economy: A Snapshot
57K
5K+
1,088
Startup
Launches
Funded Startups
In India
M&A Deals Recorded
Between 2014 And
H1 2022
$131 Bn
Funding Raised By
Startups Between 2014
And H1 2022
1,245
Investors Participated In
Startup Funding Between
2015 and H1 2022
18
Indian Internet Companies
Listed To Date
106
$450 Bn+
Indian Startups In The
Unicorn Club
Combined Valuation Of
Indian Startups
5
India’s Ecommerce Market: A Landscape
Venture Capital
Market Size And Growth
$400 Bn
18.9%
5,127
Estimated Market
Opportunity By 2030
Estimated CAGR
(2022-2030)
Number Of Active
Startups In India
$30 Bn
Funding Raised
Between 2014 And
H1 2022
682
Number Of Funded
Startups In India
170
Number Of M&As
During H1 2022
Unicorns & Soonicorns
23
Number Of
Unicorns In India
16
Number Of
Soonicorns In India
Marketplace
Ecommerce Subsector
With The Highest
Number Of Unicorns
6
Indian Ecommerce Market: Key Statistics
932 Mn+
Number Of Internet Users,
2022
128 Mn+
Number Of Online Shoppers,
FY2022
61%
17 GB
Smartphone Penetration,
2022
Average Monthly Mobile Data
Consumption Per User, 2021
9th
World Rank In Cross Border Ecommerce
Growth, 2020
100%
FDI In B2B Ecommerce & Marketplace
Model Of Ecommerce Under The
Automatic Route
23%
Increase In The GMV (Gross Merchandise
Value) Of Generated Sales During Festive
Season 2021 (Worth $9.2 Bn) Compared
To 2020
7
India’s Ecommerce Market To Surpass $400 Bn By 2030
The country’s ecommerce market is estimated to grow at a CAGR of 19% during 2022-2030
Ecommerce Market Size (In $ Bn)
400.0
300.0
200.0
100.0
0.0
Source: Deloitte, Inc42
2022F
2023F
2024F
2025F
2026F
2027F
2028F
2029F
2030F
8
Online Shoppers Are Projected To Reach 350 Mn By 2025
Online shoppers will be growing at a CAGR of 28.5% during FY 2020- FY 2025
Number Of Online Shoppers (In Mn)
400
300
200
100
0
FY2020
Source: Bain and Flipkart Report 2020
FY2021
FY2022
FY2023
FY2024
FY2025
9
Ecommerce Startups: The Funding Pyramid
77
Late Stage Ecommerce
Startups In India
197
Growth Stage
Ecommerce Startups
In India
433
Seed Stage Ecommerce Startups
In India
682
Funded Ecommerce Startups In India
5,127
Active Ecommerce Startups In India
Note: This is on the basis of number of startups funded during 2014- Q1 2022
Source: Inc42
10
$17.1 Bn
Horizontal
Total Funding Amount
Vertical
D2C
Total Funding Amount
Total Funded Startups
$939.8 Mn
Content Commerce
Total Funded Startups
Classifieds
$2.7 Bn
Automotive
Total Funded Startups
Electronic Gadgets
50+
Note: Funding is for the period 2014 to H1 2022
Total Funded Startups
Consumer Electronics
Home Decor
Others
Logistics
$810.7 Mn
Marketing
Total Funded Startups
SaaS
50+
25+
Total Funding Amount
Fashion
Total Funding Amount
Enabler
Total Funding Amount
Live Commerce
FMCG
$4.2 Bn
180+
200+
B2B Ecommerce
Recommerce
Social Commerce
Marketplace
India’s Ecommerce Landscape: Key Segments
Total Funding Amount
$4.2 Bn
Total Funded Startups
75+
Payment Gateway
Roll Ups
Industrial Goods
FMCG
Marketplace
11
India’s Ecommerce Startup Landscape
D2C
Social
Commerce
Marketplace
Ecommerce
Enabler
Recommerce
B2B
Ecommerce
12
Ecommerce Funding Trends in Q2 2022: A Snapshot
$1.2 Bn+
73
Total Funding Raised
Number Of Unique Funded Startups
38.3%
79
YoY Decline In Total Funding
$19 Mn
Average Ticket Size For Ecommerce
Deals
272%
YoY Surge In Seed Stage Funding
Note: The error in top startup hub was updated from Bengaluru to Delhi NCR, on 7 September 2022.
Total Deal Count
Delhi NCR
Top Startup Hub
Most Active Ecommerce Investors
13
Ecommerce Startups That Bagged Biggest Funding Rounds In Q2 2022
Company Name
Sub-Sector
Funding Stage
Funding Amount
Notable Participating Investors
D2C
Late Stage
$108 Mn
Venturi Partners, Trifecta Capital, IIFL Asset Management, Elevation Capital, Orios Ventures
D2C
Late Stage
$100 Mn
Alpha Wave Global
Ecommerce Enabler
Seed Stage
$100 Mn
KKR, SoftBank, Alpha Wave Global, Temasek
B2B Ecommerce
Growth Stage
$100 Mn
Prosus Ventures, WestBridge Capital, Accel, Elevation Capital, DisruptAD
Recommerce
Late Stage
$90 Mn
NewQuest, Prosus Ventures, Bessemer, Blume Ventures, Olympus Capital
B2B Ecommerce
Late Stage
$65 Mn
Lighthouse India, Creaegis, Health Quad, Ackermans & Van Haaren, British International Investment
D2C
Late Stage
$50 Mn
L Catterton, A91 Partners, Elevation Capital, India Quotient
14
Company Name
Funding Stage
Funding Amount
Notable Participating Investors
B2B Ecommerce
Undisclosed
$50 Mn
Liquidity Group’s MARS Unicorn Fund
Ecommerce Enabler
Growth Stage
$50 Mn
Winter Capital, 9Unicorns, Venture Catalysts, Vivriti Capital, Oxyzo
D2C
Undisclosed
$48 Mn
GIC
D2C
Late Stage
$45 Mn
Alpha Wave Global, Tiger Global Management, Elevation Capital, Think Investments
B2B Ecommerce
Growth Stage
$40 Mn
Tiger Global Management, Alpha Wave Global, Sparrow Capital, Stride Ventures
D2C
Late Stage
$33 Mn
Paramak Ventures, Premji Invest, Blume Ventures, Kedaara
D2C
Growth Stage
$30 Mn
WestBridge Capital
B2B Ecommerce
Growth Stage
$28 Mn
Tiger Global Management, Info Edge
Sub-Sector
15
Notable Acquisitions In India’s Ecommerce Space In Q2 2022
Company Name
Source: Inc42
Note: N/A stands for not available
Company Stage
Acquired By
Notable Investors
Seed Stage
Government Of Karnataka, Department Of Science & Technology, Qualcomm
Bootstrapped
N/A
Growth Stage
Accel, Vertex Ventures, CDH Investments, Korea Investment Partners
Seed Stage
Mumbai Angels
Bootstrapped
N/A
Bootstrapped
N/A
16
Ecommerce Funding Dropped Drastically In 2022 After A 12X Jump In 2021
On a YoY level, ecommerce startups are likely to see decline in total funding in 2022 compared to 2021
12.0
300
8.0
200
6.0
4.0
100
2.0
0.0
2014
2015
2016
2017
2018
Funding Amount (In $ Bn)
Note: The funding data in 2022 is only considered till 30th June, 2022
Source: Inc42
2019
Deal Count
2020
2021
H1 2022
0
Deal Count
Funding Amount (In $ Bn)
10.0
17
Ecommerce Funding Continues To Decline On A QoQ Basis
6.0
125
4.0
75
50
2.0
25
0.0
Q1-2021
Q2-2021
Q3-2021
Funding Amount (In $ Bn)
Note: The funding data in 2022 is only considered till 30th June, 2022
Source: Inc42
Q4-2021
Deal Count
Q1-2022
Q2-2022
0
Deal Count
Funding Amount (In $ Bn)
100
18
Average Ticket Size For Ecommerce Funding Drops To $19 Mn In Q2 2022
From its highest value i.e., $132.9 Mn in Q4 2021, the average ticket size decline by 86% in Q2 2022
Average Ticket Size (In $ Mn)
150.0
100.0
50.0
Source: Inc42
2
Q2
-2
02
2
Q1
-2
02
1
Q4
-2
02
1
Q3
-2
02
1
Q2
-2
02
1
Q1
-2
02
0
Q4
-2
02
0
Q3
-2
02
0
Q2
-2
02
0
Q1
-2
02
9
Q4
-2
01
9
Q3
-2
01
9
Q2
-2
01
9
Q1
-2
01
8
Q4
-2
01
8
Q3
-2
01
8
01
-2
Q2
Q1
-2
01
8
0.0
19
Ecommerce Funding Showed 63% Jump In Q2 2022 On A YoY Basis
D2C turned out to be the most-funded ecommerce sub-sector in Q2 2022
Recommerce
10.0%
Marketplace
3.1%
D2C
51.0%
Others
Ecommerce Enabler
1.7%
10.5%
$0.7 Bn
Ecommerce
Funding In Q2
2021
D2C
26.0%
Source: Inc42
Note: Others in Q2 2022 includes funding raised by social commerce and marketplace startups
B2B Ecommerce
50.4%
Recommerce
7.7%
$1.2 Bn
Ecommerce
Funding In Q2
2022
Ecommerce Enabler
13.8%
B2B Ecommerce
25.8%
20
Ecommerce Funding Deals Showed 84% Jump In Q2 2022 On A YoY Basis
D2C bagged maximum funding deals among ecommerce sub-sectors in Q2 2022
Others
7.0%
Others
Marketplace
5.1%
9.3%
Ecommerce Enabler
Ecommerce Enabler
11.6%
6.3%
43
Funding
Deals
In Q2 2021
Marketplace
D2C
10.1%
58.1%
D2C
65.8%
B2B Ecommerce
14.0%
B2B Ecommerce
12.7%
Source: Inc42
Note: Others in Q2 2022 includes funding raised by social commerce and marketplace startups
79
Funding
Deals
In Q2 2022
21
Ecommerce Startups Raised $3.1 Bn In The First Six Months Of 2022
Q2 2022 witnessed a decline of 38.3% in the ecommerce funding as compared to the previous quarter
1.0
Funding Amount (In $ Bn)
0.8
0.5
0.3
0.0
Source: Inc42
January
February
March
April
May
June
22
Funding At Bridge Stage Showed Highest YoY Surge For Ecommerce Startups
1250.0
Funding Amount (In $ Mn)
1000.0
+1574% (Bridge Funding)
+272% (Seed Stage)
750.0
+119% (Growth Stage)
500.0
+25% (Late Stage)
250.0
0.0
Q2 2021
Bridge Funding
Source: Inc42
Q2 2022
Seed Stage
Growth Stage
Late Stage
23
Seed Stage Saw The Highest YoY Surge In Funding Deals For Ecommerce
Startups In India
Q2 2022 witnessed a decline of 38.3% in the ecommerce funding as compared to the previous quarter
80
+129% (Seed Stage)
+100% (Bridge Funding)
Deal Count
60
+56% (Late Stage)
+46% (Growth Stage)
40
20
0
Q2 2019
Bridge Funding
Source: Inc42
Q2 2020
Seed Stage
Q2 2021
Growth Stage
Q2 2022
Late Stage
24
Top 5 Startup Hubs In Ecommerce Space (Q2 2022)
Top 5 Startup Hubs In Ecommerce Space (Q2 2022)
Delhi NCR Remains Top Destination For Ecommerce Startup Funding
Delhi NCR
Mumbai
Bengaluru
Thane
Jaipur
0.00
0.20
0.40
0.60
Funding Amount (In $ Bn)
0.80
Delhi NCR
Bengaluru
Mumbai
Jaipur
Thane
0
10
20
Deal Count
30
25
16 Soonicorns
$86 Bn Combined Valuation
$5.3 Bn Combined Valuation
$28.6 Bn Total Capital Raised
$2.1 Bn Total Capital Raised
Top Subsectors
23 Unicorns
10 Marketplace
04 B2B Ecommerce
03 D2C
07 Mumbai
07 Bengaluru
04 Mumbai
TopHubs
11 Delhi NCR
Top Hubs
Top Subsectors
The State Of Ecommerce Unicorns & Soonicorns In India
05 Bengaluru
04 Delhi NCR
08 D2C
04 B2B Ecommerce
03 Marketplace
26
Ecommerce Startup Landscape: Unicorns, Soonicorns & Growth Stage
Companies
Unicorns (Valued $1 Bn+)
Soonicorns (Valued $200 Mn+)
Growth Stage (Series A & B)
27
Inside India’s Ecommerce Unicorns
Company Name
Years To
Unicorn
Valuation
(In $ Bn)
Funding
(In $ Bn)
Notable Investors
Segment
Headquarters
Became
Unicorn In
Recommerce
Delhi NCR
2020
5
1.8
1.3
DST Global, Falcon Edge Capital, Sequoia Capital India, SoftBank
Social Commerce
Bengaluru
2022
4
1.6
0.6
Matrix Partners, Omidyar Network, InnoVen Capital, DST Global
Marketplace
Delhi NCR
2021
7
1.2
0.3
BEENEXT, Digital Garage, Lightbox Ventures, Toyota Tsusho Corporation
Marketplace
Pune
2020
10
2.0
0.7
IDG Capital, Elevation Capital,Chiratae Ventures, SoftBank, PremjiInvest
Marketplace
Bengaluru
2012
5
37.6
12.6
Accel, Axis Bank, DST Global, eBay, Flipkart, GIC, Naspers, SoftBank
Ecommerce Enabler
Delhi NCR
2021
0
1.1
0.3
Chiratae Ventures, Chrys Capital, FirstCry, Lightspeed India Partners
Marketplace
Mumbai
2021
6
1.2
0.3
Accel, Amazon, Ascent Capital, Bessemer Venture Partners
B2B Ecommerce
Mumbai
2021
5
2.5
0.4
Accel,InnoVen Capital, Nexus Venture Partners, Tiger Global Management
28
Company Name
Years To
Unicorn
Valuation
(In $ Bn)
Funding
(In $ Bn)
Notable Investors
Segment
Headquarters
Became
Unicorn In
D2C
Delhi NCR
2019
8
2.5
0.8
Chiratae Ventures,PremjiInvest, SoftBank, Temasek Holdings, TPG
D2C
Bengaluru
2021
9
1.0
0.5
3One4 Capital, Bertelsmann, IIFL Asset Management,Temasek Holdings
Marketplace
Bengaluru
2022
8
1.2
0.4
Kohlberg Kravis Roberts, Trifecta Capital, Tahoe Investment Group
D2C
Delhi NCR
2021
5
1.1
0.1
Fireside Ventures, Sequoia Capital India, Shilpa Setty, Sofina
Social Commerce
Bengaluru
2021
6
4.9
1.1
B Capital Group, DST Partners, Facebook, Investopad, Prosus & Naspers
Ecommerce Enabler
Bengaluru
2021
0
1.0
0.2
Accel, Alpha Wave Incubation, Alteria Capital, Falcon Edge Capital
B2B Ecommerce
Delhi NCR
2021
6
1.0
0.5
Accel,Bessemer Venture Partners, Tiger Global Management
Marketplace
Mumbai
2020
8
14.0
0.1
Fidelity Management and Research Company, Lighthouse Funds
29
Company Name
Years To
Unicorn
Valuation
(In $ Bn)
Funding
(In $ Bn)
Notable Investors
Segment
Headquarters
Became
Unicorn In
B2B Ecommerce
Delhi NCR
2021
6
3.0
0.9
FalconEdge Capital, InnoVen Capital, Kotak Mahindra Bank, Matrix Partners
Marketplace
Delhi NCR
2018
2
2.0
3.0
SoftBank, Alibaba Group, eBay
Marketplace
Mumbai
2022
11
1.1
0.3
Goldman Sachs, Sequoia Capital, PremjiInvest, IvyCap Ventures
Marketplace
Delhi NCR
2016
5
0.1
0.3
Helion Venture Partners, Nexus Venture Partners, GIC,InnoVen Capital
Marketplace
Delhi NCR
2014
4
N/A
1.8
SoftBank, Alibaba Group, Kalaari Capital, BlackRock, Intel Capital
Recommerce
Delhi NCR
2021
6
1.0
0.5
Abu Dhabi Growth Fund, Accel, Blume Ventures, Elevation Capital
B2B Ecommerce
Bengaluru
2018
2
3.1
1.5
BlackSoil Capital, DST Global, InnoVen Capital,Lightspeed Venture Partners
30
Inside India’s Ecommerce Soonicorns
Company Name
Segment
Headquarters
Founded In
Funding Amount (In $ Mn)
Notable Investors
B2B Ecommerce
Delhi NCR
1996
41
Elevation Capital, Intel Capital, Amadeus Capital Partners
Marketplace
Mumbai
2009
307
Canaan Partners, Epiphany Ventures, Canaan Partners, Tiger Global Management
D2C
Bengaluru
2011
100
Accel, Kalaari Capital, IvyCap Ventures, Dragoneer Investment Group
Marketplace
Mumbai
2011
53
Rise Capital, LionRock Capital, Velos Partners, LionRock Capital, Jabbar Internet Group
Marketplace
Mumbai
2011
285
Bertelsmann, Goldman Sachs, InnoVen Capital, Norwest Venture Partners, Pidlite Industries
D2C
Bengaluru
2012
229
InnoVen Capital, Trifecta Capital, Lightbox, BlackSoil
D2C
Mumbai
2012
36
Elevation Capital, Stride Ventures, India Quotient, Anicut Capital, RB Investments
31
Company Name
Segment
Headquarters
Founded In
Funding Amount (In $ Mn)
Notable Investors
D2C
Bengaluru
2014
61
Sequoia Capital, SIG, Verlinvest
B2B Ecommerce
Bengaluru
2015
151
Nexus Venture Partners, Kalaari Capital, Alteria Capital, Invus,Heron Rock Fund
B2B Ecommerce
Mumbai
2015
240
Accel, Addventures, B Capital Group, CDC Group, Chiratae Ventures, Tiger Global Management
B2B Ecommerce
Mumbai
2015
177
Lighthouse Funds, CDC Group, Toppan Printing
D2C
Delhi NCR
2016
116
Qualcomm ventures, Warburg Pincus, InnoVen Capital,Fireside Ventures,Navi Technologies
D2C
Mumbai
2016
38
Paragon Partners India, RPSG Capital Ventures, Sharrp Ventures
Social Commerce
Delhi NCR
2019
112
Elevation Capital, Accel, WaterBridge Ventures, General Catalyst Partners, Jungle Ventures
D2C
Bengaluru
2014
173
GIC, Chrys Capital
D2C
Delhi NCR
2012
86
Tiger Global Management, Innoven Capital, Elevation Capital, Think Investments
32
Revenue Analysis: Ecommerce Unicorns In India
Company Name
Sales FY20 (In $ Mn)
Sales FY21 (In $ Mn)
YoY Growth
402
364
-9%
8
32
312%
23
17
-27%
107
175
63%
4,556
5,726
26%
6.0
5.9
2%
47
142
205%
119
117
-2%
18
56
219%
53
43
-19%
15
61
320%
41
106
158%
50
104
107%
2
3
38%
93
184
97%
61
25
-59%
12
17
39%
12
15
29%
109
57
-47%
2
3
121%
$7.4 Bn Aggregate revenue clocked by ecommerce
unicorns in FY21 compared to $5.8 Bn in FY20.
$7.9 Bn Aggregate expenditure clocked by ecommerce
unicorns in FY21 compared to $6.6 Bn the previous year.
26.1% YoY surge in aggregate revenue as opposed to
20.7% in total expenditure.
Source: Inc42, MCA
Note: The analysis presented in this section is based on the sample set of 20 ecommerce unicorns. GlobalBees, Mensa Brands, and Udaan are not included.,
Note: Sales is derived from the revenue from operations
33
Profitability Analysis: Ecommerce Unicorns In India
Company Name
EBITDA FY20 (In $ Mn)
EBITDA FY21 (In $ Mn)
YoY Growth
-34.4
-19.9
42.1%
-3.9
-8.5
119.7%
-10.5
-7.5
28.8%
-16.8
30.7
282.6%
-411.1
-314.6
23.5%
-9.3
-5.3
43.2%
1.8
7.8
332.2%
5.6
11.5
105.6%
-17.5
-25.1
43.6%
-42.8
-31.4
26.7%
-0.7
4.0
642.3%
-39.8
-65.3
64.3%
-9.9
-10.1
1.8%
12.0
23.6
95.9%
4.2
6.1
43.7%
-53.6
-55.6
3.6%
-2.6
-5.7
120.1%
-5.8
-7.0
21.3%
-33.8
-10.4
69.3%
-9.1
-12.2
33.9%
30% Ecommerce unicorns in India were EBIDTA
positive in FY21.
$6.4 Mn Median monthly burn rate of Indian ecommerce
unicorns in FY21 as compared to $3.1 Mn in FY20.
-$7.0 Mn Median EBITDA of Indian unicorns in FY21, a 22%
increase from negative $9.1 Mn in FY20 indicating that
profitability still remains a question among ecommerce
unicorns although the aggregate value of losses has reduced
Source:Inc42
Note: The analysis presented in this section is based on the sample set of 20 ecommerce unicorns. GlobalBees, Mensa Brands, and Udaan are not included.
34
Indian Ecommerce Startups: Listed Companies
Company Name
Last Private Valuation
Valuation At IPO Price
Current Market Cap
$525 Mn
$1 Bn
$376 Mn
$1.2 Bn
$12 Bn
$8 Bn
N/A
$0.5 Bn
$2 Bn
Note: N/A stands for Not Available
Note: The market capitalisation of CarTrade, Nykaa, and IndiaMart indicates data recorded on 30th August, 2022
Source: Inc42
35
Indian Ecommerce Startups: Expected IPOs
Company Name
Note: N/A stands for Not Available
Source: Inc42
Headquarters
Last Private Equity Valuation
Targeted IPO Valuation
Bengaluru
$37.6 Bn
$60 Bn
Delhi-NCR
N/A
$1.5 Bn
Delhi-NCR
$1.4 Bn
$2 Bn
Pune
$2.7- $3 Bn
$6-7 Bn
Mumbai
N/A
N/A
Delhi-NCR
$1 Bn
$2 Bn
36
IndiaMART’s Share Price Hit The Peak Since Its IPO
400.0%
353.1%
Company Name
IPO Price
(In INR)
Last Traded Price
(LTP) (In INR)
% Change In Share
Price Since IPO
1,618
640.7
-60.4%
1,125
1,346.4
19.7%
973
4,408.9
353.1%
% Change In Share Price Since IPO
300.0%
200.0%
100.0%
19.7%
0.0%
-60.4%
-100.0%
CarTrade
Nykaa
Source: Inc42 Plus, NSE
Note: Last traded price is the stock closing price on August 29, 2022.
IndiaMART
37
Most Active Indian Ecommerce Investors In Q2 2022
Investor’s Name
Deal Count
Notable Startups Funded
5
5
3
3
3
3
3
3
2
2
Source: Inc42
Note: Deal count has been collated from announcement made by the startups, funds
38
In Focus
D2C (Direct To Consumer)
39
Indian D2C Startups: Key Statistics
D2C Market Opportunity By 2030
Funded D2C Brands In India
No. Of Soonicorns
$300 Bn
346
08
Digital First Brands In India
No. Of Unicorns
Total Funding
50K
03
$4.4 Bn
40
India’s D2C Landscape: Key Segments
FMCG Decor
Home
FMCG
Total Funding Amount
$2.1 Bn
Packaged Food
Soft Drinks
Hot Drinks
Total Funding Amount
$2.1 Bn
$563
Mn
250+
192+
Tissue & Hygiene
Consumer Health
Soft Drinks
Mattress
Hot Drinks
Health & Wellness
Health & Wellness
Total Funded Startups
Packaged Food
Furniture
Total Funded Startups
250+
19+
Tissue & Hygiene
Consumer Health
Beauty & Personal Care
Beauty & Personal Care
Consumer Electronics
Fashion
Total Funding Amount
$1.5 Bn
Total Funded Startups
103+
Note: Funding is for the period 2014-H1 2022
Apparel & Footwear
Eyewear
Personal Accessories
Total Funding Amount
$139 Mn
Total Funded Startups
6+
Home Appliances
Electronics
41
Evolution Of D2C In India
Emergence Of
Pure-Play D2C
(Only Own Online
Website)
Omnichannel D2C
(Presence On Own
Website &
Marketplaces)
Omnichannel
Ecommerce
(Presence On Own
Website,
Marketplace &
Offline Retail Stores)
42
Indian D2C Total Addressable Market Opportunity Is Poised To Cross $302 Bn
By 2030
The country’s D2C market is estimated to grow at a CAGR of 24% during 2021-2030
D2C Addressable Market (In $ Bn)
400.0
300.0
200.0
100.0
0.0
2021
Note: F stands for Forecasted value
Source: Inc42
2022F
2023F
2024F
2025F
2026F
2027F
2028F
2029F
2030F
43
FMCG
$2.1 Bn
192
~400%
276
Total Funding
Raised
Number Of Unique
Funded Startups
YoY Surge In Total
Funding In Q2 2022
Total Deal
Count
The Online FMCG Market Is Poised To Cross $21 Bn By 2025
Addressable Market In $ Bn
25.0
Key Trends
Subscription & Personalisation models
20.0
Natural & Toxic-Free Product Offering
15.0
Tech-enabled buying experience
10.0
Transparency in product offering
5.0
Attractive & Wide Product Portfolio
0.0
2015
2016
2017
2018
2019
2020 2021F 2022F 2023F 2024F 2025F
44
FMCG D2C Brands Landscape
Personal Care
Beauty And
Wellness
Cosmetics
TM
45
Meat
Food And
Beverage
Dairy Products
Health Supplements
Snacks
Beverages
Meals
46
Fashion
$1.5 Bn
103
70%
180
Total Funding
Raised
Number Of Unique
Funded Startups
YoY Surge In Total
Funding In Q2 2022
Total Deal
Count
Addressable Market In $ Bn
The Online Fashion Market Is Poised To Cross $43 Bn By 2025
Key Trends
50.0
Celebrity inspired or endorsed D2C brands
40.0
Customized Offering
30.0
Tech enabled and advanced products
20.0
Quirky & Fashionable Designs
10.0
0.0
2015
2016
2017
2018
2019
2020 2021F 2022F 2023F 2024F 2025F
47
Fashion D2C Brands Landscape
Western Wear
Ethnic Wear
Eyewear
Activewear
Innerwear
Footwear
Accessories
48
Home Decor
$563 Mn
19
195%
44
Total Funding
Raised
Number Of Unique
Funded Startups
YoY Surge In Total
Funding In Q2 2022
Total Deal
Count
The Online Home Decor Market Is Poised To Cross $5.4 Bn By 2025
Market Potential In $ Bn
6.0
Key Trends
Focus On Sustainability
Wider Product Offerings
4.0
Increased Demand Due To WFH Flexibility
2.0
0.0
More Focus On Health Based & Ergonomic Preferences
2015
2016
2017
2018
2019
2020 2021F 2022F 2023F 2024F 2025F
49
Home Decor D2C Brands Landscape
Home Decor
50
Consumer Electronics
$139 Mn
06
12
Total Funding
Raised
Number Of Unique
Funded Startups
Total Deal Count
Addressable Market In $ Bn
The Online Consumer Electronics Is Poised To Cross $31 Bn By 2025
Key Trends
50.0
Increased Affordability Of Devices
40.0
Appealing Aesthetics & Design
30.0
Increased Health Awareness
20.0
Varied Used Cases
10.0
0.0
Rising Demand In Tier 2 & More Markets
2015
2016
2017
2018
2019
2020
2021F 2022F 2023F 2024F 2025F
51
Consumer Electronics D2C Brands Landscape
Consumer Electronics
52
D2C Startups Continue To Bag Investor Interest, $1.3 Bn Raised In H1 2022
200
150
1.0
100
0.5
50
0.0
2014
2015
2016
2017
2018
Funding Amount (In $ Bn)
Note: The funding data in 2022 is only considered till 30th June, 2022
Source: Inc42
2019
Deal Count
2020
2021
H1 2022
0
Deal Count
Funding Amount (In $ Bn)
1.5
53
0.8
80
0.6
60
0.4
40
0.2
20
0.0
0
Q1-2021
Q2-2021
Q3-2021
Funding Amount (In $ Bn)
Source: Inc42
Q4-2021
Deal Count
Q1-2022
Q2-2022
Deal Count
Funding Amount (In $ Bn)
Funding For D2C Brands Recorded 10% Decline In Q2 2022 Compared To
Q1 2022
54
$15 Mn Average Ticket Size Of D2C Funding In Q2 2022
The average ticket size for D2C startups grew by 12.3% in Q2 2022 as compared to previous quarter
Average Ticket Size (In $ Mn)
20.0
15.0
10.0
5.0
Source: Inc42
2
02
Q2
-2
2
Q1
-2
02
1
Q4
-2
02
1
Q3
-2
02
1
Q2
-2
02
1
Q1
-2
02
0
Q4
-2
02
0
Q3
-2
02
0
Q2
-2
02
0
Q1
-2
02
9
Q4
-2
01
9
Q3
-2
01
9
Q2
-2
01
9
Q1
-2
01
8
Q4
-2
01
8
Q3
-2
01
8
01
-2
Q2
Q1
-2
01
8
0.0
55
Average Ticket Size For D2C Brands Grew By 12.3% In Q2 2022 Compared
To Q1 2022
Average Ticket Size (In $ Mn)
20.0
15.0
10.0
5.0
0.0
Q1-2021
Source: Inc42
Q2-2021
Q3-2021
Q4-2021
Q1-2022
Q2-2022
56
Around 195% Growth In D2C Funding In Q2 2022 Compared To Q2 2021
FMCG turned out to be the most-funded D2C sub-sector in Q2 2022
FMCG
Others
59.7%
3.3%
Others
Consumer Electronics
2.7%
4.8%
FMCG
$202 Mn
D2C Funding
In Q2 2021
Home Decor
5.0%
Fashion
56.6%
35.3%
Fashion
32.5%
Source: Inc42
Note: Others includes funding raised by startups in home and lifestyle, kitchenware, handicrafts, plants, bakery and more categories.
$597 Mn
D2C Funding
In Q2 2022
57
Growth Stage Saw The Highest YoY Surge For D2C Startups In India
Funding Amount (In $ Mn)
600.0
400.0
+219% (Growth Stage)
+204% (Late Stage)
+92% (Bridge Funding)
200.0
0.0
+119% (Seed Stage)
Q2 2021
Bridge Funding
Source: Inc42
Seed Stage
Q2 2022
Growth Stage
Late Stage
58
Only Bridge Stage D2C Startups Saw Positive Growth In Q2 2022 Compared
To Q1 2022
800.0
Funding Amount (In $ Mn)
+101% (Bridge Funding)
-10% (Late Stage)
600.0
-20% (Growth Stage)
-27% (Seed Stage)
400.0
200.0
0.0
Q4-2021
Bridge Funding
Source: Inc42
Q1-2022
Seed Stage
Q2-2022
Growth Stage
Late Stage
59
Late Stage Saw The Highest YoY Surge In Deal Count For D2C Startups
In India
60
+150% (Late Stage)
+46% (Seed Stage)
+40% (Growth Stage)
Deal Count
40
20
0
Q2 2019
Q2 2020
Bridge Funding
Source: Inc42
Q2 2021
Seed Stage
Growth Stage
Q2 2022
Late Stage
60
D2C Brands Witnessed Drastic Decline In Seed Funding In Q2 2022
80
-7% (Growth Stage)
60
-20% (Bridge Funding)
Deal Count
-42% (Seed Stage)
40
20
0
Q1-2021
Q2-2021
Bridge Funding
Q3-2021
Seed Stage
Q4-2021
Growth Stage
Q1-2022
Late Stage
Q2-2022
61
Early Stage D2C Startups Making Waves
62
30 Early Stage Indian D2C Startups Making Waves
Allegra
Alpino Health Foods
It is a D2C women apparel brand
It is a D2C peanut butter brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
Fashion
N/A
2021
Delhi NCR
FMCG
$0.65 Mn
2016
Surat
NOTABLE INVESTORS
NOTABLE INVESTORS
Bootstrapped
RBF
Avni
BabyAmore
It is a D2C feminine hygiene brand
It is a Babycare marketplace
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
$0.6 Mn
2021
Mumbai
Fashion
Undisclosed
2019
Chennai
NOTABLE INVESTORS
NOTABLE INVESTORS
Dr C Srirani, Nimish Parekh, WeFounders Circle
Get Vantage, Velocity, Klub
63
Bartisans
Bombay Island Coffee
It is a D2C cocktail mixers brand
It is a D2C artisnal coffee brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
Undisclosed
2020
Mumbai
FMCG
Undisclosed
2018
Mumbai
FOUNDING YEAR
HQ
2018
Delhi NCR
NOTABLE INVESTORS
NOTABLE INVESTORS
RPSG Capital Ventures, Iluminar Media Private Limited
Bootstrapped
CURRYiT
Deciwood
It is a D2C ready to cook curry pastes
It is a D2C bluetooth speaker brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
FMCG
$0.14 Mn
2020
Delhi NCR
Consumer Electronics $0.25 Mn
TOTAL FUNDING
NOTABLE INVESTORS
NOTABLE INVESTORS
RPSG Capital Ventures, IIMU Incubation Centre, Others
Let’s Venture, Ankit Kedia,Sunil Kamath, Rohit Raj, Arun Gupta, Neeraj Saxena
64
Fitspire
Flexnest
It is a D2C wellness startup
It is a D2C home workout and connected wear brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
FMCG
$1 Mn
2020
Delhi NCR
Consumer Electronics N/A
TOTAL FUNDING
NOTABLE INVESTORS
NOTABLE INVESTORS
Sukhbir Singh, Startup Buddy, Sheel Oils, Sesa Oils
Bootstrapped
Floryo
FOUNDING YEAR
HQ
2021
Delhi NCR
Lauriko
It is a D2C made-to-order staples brand
It is a D2C health & wellness brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
$2 Mn
2022
Bengaluru
FMCG
$0.4 Mn
2021
Hyderabad
NOTABLE INVESTORS
NOTABLE INVESTORS
3one4 Capital, Vivek Gupta, Abhay Hanjura, Kunal Shah, Aman Gupta, Varun Alagh, Rishi Vasudev,
Vijay Arisetti, Sameer Mehta, Alteria Capital
Undisclosed
65
Lemme Be
Paradyes
It is a D2C menstrual hygiene brand
It is a D2C semi permanent hair color brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
$2.5 Mn
2020
Hyderabad
FMCG
N/A
2020
Ahmedabad
NOTABLE INVESTORS
NOTABLE INVESTORS
Wami Capital, Multiply Ventures
Bootstrapped
Pawrulz
Plow Foods
It is a D2C petcare brand
It is a D2C packaged protein foods
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
N/A
2019
Delhi NCR
FMCG
Undisclosed
2021
Delhi NCR
NOTABLE INVESTORS
NOTABLE INVESTORS
Bootstrapped
Undisclosed
66
Qua
Raskik
It is a D2C women’s westernwear brand
It is a D2C ready to drink beverages
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
Fashion
N/A
2019
Delhi NCR
FMCG
Undisclosed
2019
Delhi NCR
NOTABLE INVESTORS
NOTABLE INVESTORS
Bootstrapped
Fluid VC
Snitch
Something’s Brewing
It is a D2C men’s apparel brand
It is a D2C artisnal coffee marketplace
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
Fashion
Undisclosed
2018
Bengaluru
FMCG
N/A
2020
Bengaluru
NOTABLE INVESTORS
NOTABLE INVESTORS
Undisclosed
Bootstrapped
67
Spice Story
SVISH On The Go
It is a D2C ready-to-eat spices, condiments, sauces and chutneys brand
It is a D2C personal hygiene brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
$0.5 Mn
2019
Mumbai
FMCG
$1.7 Mn
2020
Delhi NCR
NOTABLE INVESTORS
NOTABLE INVESTORS
VCATS, Agility Partners, Lets Venture, VLA, Angels
LC Nueva AIF, Wami Capital
The Health Factory
The June Shop
It is a D2C protein bread startup
It is a D2C home décor brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
$0.25 Mn
2021
Mumbai
Home Decor
Undisclosed
2019
Kolkata
NOTABLE INVESTORS
NOTABLE INVESTORS
Venture Garage, Vikas Nahar, Happilo
Vijay Subramaniam, Pratik Nahata, Sreekumar Krishnan
68
The Minimal Co
Toqn
It is a D2C mulberry silk-based skin and haicare brand
It is a D2C modular and interchangeable gold jewellery brand
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
N/A
2020
Delhi NCR
Fashion
$0.225 Mn
2019
Bengaluru
NOTABLE INVESTORS
NOTABLE INVESTORS
Bootstrapped
Undisclosed
uppercase
Urvann
It is a D2C travel accessories brand
It is a D2C gardening startup
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
Fashion
$8.5 Mn
2022
Mumbai
Home Decor
$0.45 Mn
2021
Delhi NCR
NOTABLE INVESTORS
NOTABLE INVESTORS
Sixth Sense Ventures, Volorado Venture Partners
Inflection Point Ventures
69
Wildermart
What’s Up Wellness
It is a D2C everyday essentials startup
It is a D2C health and wellness startup
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
SUBSECTOR
TOTAL FUNDING
FOUNDING YEAR
HQ
FMCG
N/A
2020
Kolkata
FMCG
$3 Mn
2019
Bengaluru
NOTABLE INVESTORS
NOTABLE INVESTORS
Bootstrapped
Sairee Chahal, Sreenivasan Ramakrishnan, Anand Rangaswamy, Dr Rohit Bhardwaj
70
Financial Analysis Of Indian D2C Brands
$1.03 Bn+ in total sales clocked by Indian D2C brands in FY21
39% year-on-year increased in total sales between FY20 & FY21
WOW Skin Science witnessed the highest sales growth (FY20 & FY21) among the sample set
1 out of 4 funded D2C brands in India were operationally profitable in FY21
$157 Mn+ spent by Indian D2C brands on advertising in FY21
$2.6 Mn median advertising budget of Indian D2C brands in FY21
$40 Mn spent on logistics by Indian D2C brands in FY21
42% year-on-year surge in aggregate logistics expenditure between FY20 & FY21
$873K median expenditure on logistics by Indian D2C brands in FY21
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who had revenue over
INR 20Cr in FY21 and make 80% of total venture capital inflow in Indian D2C brands to date.
71
Indian D2C Brands Sales Crossed $1 Bn Mark In FY21
1.25
+39% YoY Surge
Aggregate Revenue ($ Bn)
1.00
Despite 2 out of every 5
Indian D2C brands
recording a decrease in
sales from FY20 to FY21,
the combined revenues of
these brands showed a
39% YoY surge in revenue
from sales
0.75
0.50
0.25
0.00
FY20
FY21
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who had revenue over INR 20Cr in FY21 and make 80% of total venture capital inflow in Indian D2C brands to date.
INR to USD exchange rate is 80
72
Indian D2C Brands Which Recorded The Highest Annual Growth In Sales
Between FY20 & FY21
Top 10: D2C Brands With Highest Sales Growth
WOW Skin Science
Mamaearth
Minimalist
Top three Indian D2C
brands which witnessed
the highest YoY sales
growth between FY20 & ‘21
are from the beauty &
personal care segment.
Licious
Vahdam Teas
DaMENSCH
Happilo
boAt
Bombay Shaving
Company
Wakefit
0.00
5.00
10.00
15.00
20.00
YoY Sales Surge (In x times)
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who had revenue over INR 20Cr in FY21 and make 80% of total venture capital inflow in Indian D2C brands to date.
INR to USD exchange rate is 80
73
Top 10 Indian D2C Brands With The Highest Sales Growth Between FY20 & ‘21
Company Name
Sales (FY20)
Sales (FY21)
YoY Surge
$0.8 Mn
$12 Mn
15.4x
$14 Mn
$58 Mn
4x
$0.8 Mn
$3 Mn
3.4x
$16 Mn
$53 Mn
3.2x
$4 Mn
$10 Mn
2.6x
$1.1 Mn
$3 Mn
2.5x
$7 Mn
$17 Mn
2.4x
$88 Mn
$189 Mn
2.2x
$2 Mn
$5 Mn
2.1x
$25 Mn
$51 Mn
2.1x
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who have revenue over INR 20Cr in FY21.
INR to USD exchange rate is 80
74
Only 1 Out 4 Funded D2C Brands In India Are Operationally Profitable
Profitable Operationally
25.7%
Top Indian
D2C Brands
The supply and consumer
demand shock infused by the
pandemic in FY22 & ’23, clubbed
with growing competition. We
expect more Indian D2C brands to
close their annual accounts in
loss for the financial year 2022
Loss Making
74.3%
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who had revenue over INR 20Cr in FY21 and make 80% of total venture capital inflow in Indian D2C brands to date.
INR to USD exchange rate is 80
75
Notable Indian D2C Brands Which Are Operationally Profitable
Company Name
Total Revenue (FY21)
Total Expenditure (FY21)
Operating Income
$180 Mn
$161 Mn
$20 Mn
$191 Mn
$178 Mn
$14 Mn
$126 Mn
$119 Mn
$6.9 Mn
$26 Mn
$20 Mn
$5.6 Mn
$58 Mn
$54 Mn
$3.8 Mn
$18 Mn
$16 Mn
$1.9 Mn
$11 Mn
$8.9 Mn
$1.8 Mn
$2.8 Mn
$2 Mn
$0.8 Mn
$9.0 Mn
$8.7 Mn
$0.3 Mn
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who have revenue over INR 20Cr in FY21.
INR to USD exchange rate is 80
76
$157 Mn Spent By Indian D2C Brands On Advertising In FY21
200
+12% YoY Surge
Aggregate Advertising Expenditure
150
The median advertising
budget for a top funded D2C
brand in India was $2.6 Mn in
FY21. Unchanged on YoY
basis compared to the
previous year.
100
50
0
FY20
FY21
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who had revenue over INR 20Cr in FY21 and make 80% of total venture capital inflow in Indian D2C brands to date.
INR to USD exchange rate is 80
77
Indian D2C Brands With Highest Market Spends
Company Name
Sales (FY20)
Sales (FY21)
YoY Surge
$5.7 Mn
$22 Mn
3.9x
$6.4 Mn
$18 Mn
2.9x
$14 Mn
$16 Mn
1.1x
$21 Mn
$13 Mn
-39%
$14 Mn
$8.9 Mn
-36%
$6.2 Mn
$8.2 Mn
1.3
$4.6 Mn
$7.0 Mn
1.5
$9.2 Mn
$5.8 Mn
-37%
$2.6 Mn
$5.5 Mn
2.1
$0.3 Mn
$5.5 Mn
17.5
Source: Inc42 Calculations, Company Filings
Note: The aggregate revenue for both financial years is based on the sample set of top 35 funded D2C startups in India who have revenue over INR 20Cr in FY21.
INR to USD exchange rate is 80
78
Indian D2C Founder Survey, 2022
50% D2C brands in India have an omnichannel presence
Brands Awareness the most significant challenge for D2C brands in India
63% Indian D2C brands leverage influencer marketing
Up to 20% marketing budget allocation on social media influencers in FY23
Instagram the preferred social media platform for engagement and conversions
75% D2C brands in India prefer third-party logistics
66% D2C brands in India do not sell their products overseas
Shiprocket the most popular choice for logistics
Note: The above-mentioned insights are based on survey analysis of 50 Indian D2C brands
79
50% Indian D2C Brands Have Omnichannel Presence
No
21.1%
Indian
D2C
Brands
Planning on it
28.9%
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: Do you have an omnichannel presence (both online and offline)?
Yes
50.0%
87% of Indian D2C brands
give high importance to
having an omnichannel
(online + offline)
presence.
80
Brand Awareness Is The Most Significant Challenge For D2C Brands In India
Brand awareness (marketing)
Commision of third-party digital
marketplace
Growing competition,
presence of legacy brands
and rising CAC, can hinder
the marketing effectiveness
of Indian D2C brands
Growing competition
Customer retention
Logistics partner integration
Product distribution
Manufacturing/Production
0%
10%
20%
Number of respondents
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: Which of the following do you believe is the most significant challenge for India’s D2C ecosystem?
30%
40%
81
More Than 60% D2C Brands In India Leverage Influencer Marketing
No
36.8%
Indian
D2C
Brands
Yes
63.2%
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: Do you leverage influencer marketing?
In FY23, Indian D2C brands plan
on spending approximately 5% to
20% of their annual marketing
budget on social media
influencers
82
Indian D2C Brands Expected To Spend Up To 20% Of Their Marketing Budget
On Social Media Influencers In FY23
5% to 20%
84% of Indian D2C
brands plan on allocating
up to 20% of their annual
marketing budget on
social media influencers
this financial year
Less than 5%
21% to 30%
More than 30%
0%
10%
20%
30%
Number of respondents
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: What percentage of your marketing budget will be spent on influencer marketing in FY23?
40%
50%
83
Instagram A Clear Winner In Terms Of Both Social Media Engagement &
Conversions
Instagram
Backed by the growing
number of influencers
and popularity of “reels”
in India. Instagram can
be termed as the most
popular and effective
social media platform for
D2C brands.
YouTube
Others
0
20
40
Best Enagament
60
80
Best Conversions
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: Which of the following social media platform generates the most engagement for you? & Which of the following social media platform generates the most conversions for you?
84
Majority Of Indian D2C Brands Prefer To Sell On More Than Five Online
Ecommerce Marketplace
5-8
Number of marketplace
More than 10
1-3
None
4-5
9-10
0%
10%
20%
% number of respondents
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Question asked: How many online marketplaces do you sell on?
30%
85
Amazon Is The Most Preferred Ecommerce Marketplace By Indian D2C Brands
Others
13.3%
Myntra
13.3%
Indian
D2C
Brands
Flipkart
16.7%
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Question asked: Which of these is your favourite ecommerce marketplace?
Amazon India
56.7%
52% of Indian D2C brands
sell their products on more
than five ecommerce
platforms
86
Shiprocket Is The Most Preferred Logistics Partner For Indian D2C Brands
Shiprocket
Bluedart
Shiprocket is also the
latest logistics startup to
attain unicorn status in
August 2022
Delhivery
Pickrr
Others
0%
10%
20%
Preferred Logistics Partner
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Question asked: Which among these is your preferred logistics partner?
30%
87
More Than 75% D2C Brands In India Prefer To Have Third-Party Logistics
Inhouse Logistics
23.7%
Indian
D2C
Brands
Outsourced
76.3%
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Question asked: How do you manage your logistics?
88
Importance of selling overseas on scale (1 to 10)
Indian D2C Brands Are Bullish On Selling Their Products Overseas
High Impact (6 to 10)
Moderate (5)
Low Impact (0 to 4)
0%
20%
40%
Number of respondents
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: On a scale of 1 to 10 rate the importance of expanding overseas for modern D2C brands in India
60%
80%
89
Two-Third D2C Brands In India Do Not Sell Their Product Overseas
Yes
34.2%
Indian
D2C
Brands
No
65.8%
Source: Inc42’s Indian D2C Founder Survey 2022
Note: This analysis is based on the survey of 50 D2C brands in India
Questions asked: Do you sell your products overseas?
90
Key Challenges For D2C Brands In India
High Competition From Legacy Players & Marketplaces
High competition from legacy players since they have strong distribution network and are easily accessible especially in semi-urban and rural areas.
Difficult to match price range & discounts offered by marketplaces
Difficulty In Managing Logistics
Difficulty in dealing with multiple third-party delivery partners
High RTO (return-to-origin) rate in case of COD (cash-on-delivery)
Connectivity issues in tier-2 & tier-3 cities due to poor infrastructure
Low Customer Retention & Loyalty
Given the crowded space, customers have shifted to product loyalty than brand loyalty resulting in reduced lifetime value of a customer and high churn rate
High Customer Acquisition Cost
High marketing costs results in costly customer acquisition
High commission charged by ecommerce marketplaces & high dependence on ecommerce platform for brand visibility makes it a compulsion to be present on it
91
Ecommerce: Emerging Trends In India
Rise Of Visual Search
Tech-savvy internet users have been using image searches to buy anything that they like by uploading images on ecommerce platforms and getting products similar to the images
uploaded by them.
Focus On Sustainability
With the rise in awareness among consumers, D2C brands have also started focusing on environmentally-friendly practices, from green packaging to more eco-friendly shipping
methods.
Integration Of Metaverse For Sales
Homegrown consumer electronic brand Leaf Studios is planning to make a launch in metaverse. When consumers make physical purchases of the brand’s headphones, the firm
will also drop the NFT (Non-fungible token) in their metamask wallets which will help them unlock the same headphone in metaverse.
Growing Popularity Of Live Commerce
Live Commerce is a new trend where brands or influencers hired by them do live streams, placing commercial products front-and-center. For instance, Walmart-backed Flipkart
and Meesho also embraced live commerce this year.
92
Updates From ONDC Universe
ONDC prepares to launch in September 2022 and reach 100 cities by the end of the year.
Currently, ten platforms including Reliance owned Grab, Paytm, Digit, PhonePe, eSamudaay, Go Frugal, Dunzo and Loadshare are a part of the
open network.
Microsoft has become the first big tech company to join ONDC
Confederation of All India Traders (CAIT), a representative body of 70 Mn+ small retailers, is likely to join the government-backed ONDC by the
end of 2022.
SoftBank and Sequoia India has advised their portfolio startups in India to join ONDC.
OYO, Zomato and Swiggy are likely to join the network and are in various stages of integration.
National Restaurant Association of India (NRAI) plans to onboard its restaurants to the network.
93
Draft Ecommerce Policy: Key Features
Issued by DPIIT in February 2019, center is once again deliberating on the draft guidelines and pkan to launch it soon in the public domain.
The overall objective of this Policy is to prepare and enable stakeholders to fully benefit from the opportunities that would arise from
progressive digitalization of the domestic digital economy.
Scope and objectives are defined under 6 heads including data, infrastructure development, ecommerce marketplaces, regulatory
issues, stimulating the domestic digital economy and export promotion through ecommerce
Aims to regulate cross-border data flow, while enabling sharing of anonymised community data (data collected by IoT devices
installed in public spaces like traffic signals or automated entry gates)
Development of data-storage facilities/infrastructure to facilitate last mile connectivity across urban and rural India
Provides for integrating Customs, RBI and India Post systems to improve tracking of imports through e-Commerce. All ecommerce
websites and applications available for downloading in India must have a registered business entity in India as the importer on record
or the entity through which all sales in India are transacted.
94
Ecommerce entities are required to publicly share all relevant details of sellers who make their products available on
websites/platforms of these entities. All the sellers/retailers are required to furnish an undertaking of genuineness of products to the
platforms and the same must be made accessible to consumers by the platforms
Recognising the inter-disciplinary Draft Page 8 of 41 nature of ecommerce, the Standing Group of Secretaries on e-Commerce (SGoS)
is recognised as the mainmechanism to tackle inter-departmental issues effectively.
Proposes removal of application fee for claiming export benefits for Indian domestic
manufacturers/MSMEs/start-ups/sellers/retailers
Aims to clearly demarcate what constitutes a marketplace model and what comprises an inventory-based model of sale and
distribution.
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