Driven by an urge for personalised experiences among people, the Indian consumertech industry is likely to reach $300 billion by 2027, growing at a CAGR of 25 per cent, a report showed on Tuesday.
The current total addressable market (TAM) of the consumertech industry is valued at $100 billion, with the dominant sectors being mobility (30 per cent share of the market) which includes ride-hailing apps, automobile marketplace and online car rental market followed by entertainment (25 per cent) which includes print, digital, and television media.
By 2027, fashion is expected to overtake entertainment as the second leading sector with apparel and accessories, beauty and personal care, footwear, jewellery and watches, according to the report by Chiratae Ventures, in collaboration with consulting firm 1Lattice and powered by Google.
“We have, till date, invested $450 million into the sector. Key winners backed by Chiratae include Flipkart, Myntra, Cult.fit, Firstcry, Lenskart, GlobalBees, Policybazaar, PlaySimple, Curefoods, Fibe and Rentomojo, to name a few,” said Sudhir Sethi, Founder and Chairman of Chiratae Ventures.
“We continue to invest in companies such as Agrostar, Healthifyme, Miko, Artium, and a new breed of consumer deeptech companies such as KBCols and Aether as well,” he informed.
Over 500 million Indians now seek entertainment and gaming services on a daily basis, Over 1.2 billion people in India need good healthcare, and 1.1 billion people have a bank account and seek to invest in financial services.
About 880 million people aspire to spend on fashion and apparel, and 220 million seek to spend on on-demand services. This has resulted in an increased focus on personalisation, a rise in experiential retail and a growing influence of social media, the report mentioned.
“The Indian Consumertech sector is experiencing swift rise of over-the-top (OTT) services on the subscription side, an increasing involvement of women in gaming, commerce and social media, and a notable rise in green mobility solutions such as EV sales, said the report.
“The rapid evolution of AI presents an incredible opportunity for businesses to engage with their consumers in newer, more meaningful ways that deliver effective purchase outcomes whilst also responding to their need for privacy,” said Roma Datta Chobey, Managing Director – Digital First Businesses, Google India.
Consumers, on average, dedicate over four hours daily to their smartphones. The fintech apps dominates usage, with 77 per cent of respondents leveraging it, primarily due to robust security features and a user-friendly interface.
Following closely, entertainment apps capture a significant share at 70 per cent, with on-demand services being perceived as essential expenses in the daily lives of about 70 per cent of consumers, the findings showed.
Gaming, e-commerce, and healthtech are also gaining traction among Indian digital consumers.
“This growth potential is underscored by the ambitions of Indian homegrown startups, driven by robust revenue growth and eyeing global expansion, fuelled by an ever-growing digital native user base,” said Roma Dixit, Director, Financial Services, 1Lattice.