$100bn digital consumer spending potential by 2020: Google, BCG Report

16 Feb,2018

By A Correspondent


Capturing the growth of digital influence and key consumer insights that will drive the next phase of digital consumer spending in India, Boston Consulting Group (BCG) and Google India released a report, ‘Digital Consumer Spending in India: A $100 Bn Opportunity’. The report projects that the potential for digital spending is expected to grow 2.5 times from ~$40bn to ~$100bn by 2020 led by sectors such as e-commerce ($18-45bn), travel and hotel ($11-20bn), financial services ($12-30bn) and digital media ($200-570mn). The report also finds that women, new users from non-tier 1 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 from cities beyond metros and together it is expected to comprise more than 50 percent of the total online shopper base by 2020.


Speaking about the key findings of the report, Nimisha Jain, Partner & Director, The Boston Consulting Group, India said: “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.”
The report highlights that there are 75-80 per cent 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. 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.


Speaking about the key findings of the report, Nitin Bawankule, Industry Director, Google India said: “Digital spending in 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 & 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.”



Post a Comment 

Comments are closed.