May, 2019     

Online Retail Market Updates


Home & Living market in India stands at ~USD 28 Bn. and is set to reach ~USD 50 Bn. in 5 years

Published on: May 2019

Mattresses constitute ~15% of the Furnishing market, which stands at ~USD 11 Bn. in FY19

Mattresses are the only category in the Home & Living market that reflects a high share of branded play at ~35%

Branded mattresses are dominated by PU foam mattresses, but Spring mattresses are driving growth

The geographic segmentation of the market by brands & retailers has evolved from broad urban/ rural segmentation to a granular city type segmentation

Published on: Apr 2019

However, with the growth of high potential sub-urban clusters, the segmentation approach needs to be revised for efficient targeting

  • The clusters are not homogenous in nature. Differing economic factors & growth drivers bring heterogeneity to these clusters
  • It is imperative for brands & retailers to treat each cluster differently

Large clusters like Mumbai & Delhi have high granularity, requiring micro-cluster level targeting of customers

Brands & Retailers need to realign their strategy differently for various clusters to achieve further growth in their business metrics

 


Value fashion retail market in India is a USD 50 Bn market with a high presence in tier II or III cities owing to easier availability of retail space, and a higher demand of lower price points in these geographies

Published on: Apr 2019

Players go for a cluster approach of expansion, rather than expanding to multiple regions at once, with most players focussed in the north and east

Most of the players have a scale-driven approach, gaining profits by larger scales rather than higher price per item


Small Kitchen Appliance market is pegged at USD ~1.5 Bn, with a growth rate of 6%…

Published on: Apr 2019

… characterized by a large number of regional players, with few national players capturing only ~45% of the market offering…

…more than two-thirds of the products in the economy and mass range driven by technological advances driving the prices down…

…and driving the growth of niche categories like Juicer-Mixer-Grinders…

…Induction Cook Tops and Toaster & Sandwich Makers


Cookie Jar : India’s biscuits & cookies market is set to be ~ $10 billion opportunity by 2023, dominated by branded players marking ~90% of market

Published on : Mar 2019

 

Specialized players have captured the market share from traditional players by focusing on premium segments like cookies & digestive biscuits

  • Increasing health awareness & increased spend has led to a shift from mass variants (glucose & cream) to niche segments
  • Leading biscuit players such as Britannia and Parle are diversifying into complementary categories such as confectionery, snacks, dairy etc. to reduce dependency on biscuit segment

 

Key players have introduced offerings across price points and product categories to cater to the demand of a diverse set of consumers…

All major players have introduced product across the entire basket of biscuit category and are increasing focus on premium segment

 

Traditional biscuit players are losing wallet share to specialized players in niche segments and emerging substitute categories

 


Men’s innerwear : Reflects highest branded quotient across lifestyle categories & expected to grow further to 60% share

Published on : Feb 2019

  • Adoption of higher priced premium brands coupled with the trend of consumers engaging with mass brands in smaller Indian cities is driving the growth of men’s innerwear
  • Market driven efforts to offer a complete range of products including active wear and comfort wear by mid segment players is driving growth of this segment
  • Whereas, increasing fashion range and entry of apparel brands in Men’s innerwear is driving growth of premium and super premium segment

 

The mid segment is witnessing traction from both legacy brands as well as lifestyle apparel brands ; expected to reflect sharp sub-segmentation

  • The men’s premium segment is largely catered to by lifestyle fashion brands : Van Heusen, Park Avenue, UCB, Levi’s etc. while super premium segment is being catered to by global fashion brands
  • However, mid and economy segment players are diversifying their product offering to include women’s innerwear and athleisure to scale their business

 

Increasing demand for fashion attributes & functional features is driving premiumization in the market


Brands’ focus on product packaging, product customization and innovative marketing strategies has lend to shift from unbranded to packaged ingredients which is driving growth of packaged ingredients market

 

Published on : Feb 2019

 

  • Growth in the packaged spices and ingredients market, marking one-third of the total ingredients segment, is driven by consumer driven factors such as rising population, increasing expenditure on the food basket, and shift from unbranded to branded spices
  • Further, supply driven levers such as improved brand focus on packaging, locally demanded products and innovative marketing initiatives are also fueling growth of packaged ingredients market
  • Packaged ingredients market is fragmented with presence of long tail of specialty players, national and regional, FMCG majors as well as private label

Basic spices constitutes 60% of ingredients market. However, the segment is evolving to include blended spices, cooking paste, international blends, pickles, RTE and RTC categories

 

  • Growing popularity of international cuisines owing to globalization and rising international tourism by Indians has resulted in demand growth for blended spices, cooking pastes and international blends
  • Further, an evolved Food Services ecosystem offering a variety of domestic and international cuisines offers potential opportunity for scale and new addressable segments such as HoReCa

Players keen to own the cooking pan : Migrating from basic spices to include wide range of products including blended spices, pastes, RTE/RTC

An erstwhile basic segment ; now reflects nuances of price segmentation with price multipliers of 1.5-2X over mass and mid brands

Modern Trade Format : Retail shelf space is contested for across a)categories as well as b)brands

Private Label play will intensify and leading retailers currently focused on basic and blended spices will foray into high margin niche categories such as Cooking Paste, Ready To Eat (RTE) & Ready To Cook (RTC) and Pickles

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