Instamojo, full-stack digital solutions provider for D2C and small business owners conducted a study across its platform to understand the trends and developments in the DTC eCommerce space. The ‘Indian DTC brands eCommerce outlook 2022’ report launched as a part of the study draws upon the experiences of over 20 lakh small businesses in 2021. It lays out 6 major trends foreseen for the upcoming year.
The outlook for DTC online businesses looks promising for 2022. Today’s digital entrepreneur is more dynamic and aware than they have ever been. With the right kind of tools and support from the Govt. as well as the private sector, India is on the path to record massive business growth.
Key insights
More women-led DTC businesses come into the spotlight: Instamojo witnessed over 5,00,000+ women visiting the website in 2021. 40 percent of the total online businesses using Instamojo are women, with increased interest from women aged above 50.
Heightened attention to data transparency: In most cases, consumers are not actually against sharing their data, what they demand is transparency.
Focus on sustainable packaging and healthy products: As consumer conscience grows, their expectations from brands are also on an all-time high.
Sampad Swain, CEO and Co-Founder, Instamojo, said, “As entrepreneurs and small businesses increasingly learn the benefits of selling independently online, we can expect the DTC model to catalyse business growth significantly in the coming quarters. In the last couple of years, both digitisation and changing consumer behaviours have made it imperative for small businesses to move and/or expand online. To this front, in the post-pandemic world, the DTC model can be an effective solution to accelerate business recovery.”
Major DTC brand eCommerce trends:
1) Consumers become more DTC brand conscious.
The year 2022 will be ruled by consumer sentiment. As e-commerce grows, brands will be conscious of the product they are selling, and also how they are selling it. There will be a heightened focus on sustainability, not just for the product but for the entire supply chain.
Consumers are also becoming more aware of ‘where’ the product comes from. There has been an increase in Indians wanting to support local and small businesses over industrialised factory products or from multinational corporate brands.
2) DTC brands will take control over the customer journey
eCommerce has evolved from ‘commercial transactions that happen over the internet’ to personalised, more customised journeys that feel more human. Brands today will invest in resources that make the entire customer experience frictionless and hassle-free.
One of India’s leading tech-enabled logistics and order fulfilment platform witnessed a 60 percent growth in the number of independent sellers on-boarding on its platform. A clear indicator of an increase in DTC brands.
DTC brands will also invest more in the power of SEO. Need for hyper-personalisation and instant gratification by consumers make DTC brands a preferred channel or eCommerce
3) SEO will become the most important marketing channel.
SEO meta tag features are the second-most popular premium feature at Instamojo, indicating that online store owners are relying on their own website and SEO skills to reach consumers directly.
SEO will become the biggest FREE acquisition channel for DTC brands in India in 2022. Along with SEO, social media will play an even larger role in aiding brand discovery. Influencer marketing will lead the way for organic growth. YouTube will be spearheading this growth.
4) Social commerce will be the preferred channel for e-commerce from a consumer PoV
The new wave of DTC brands are aware that selling on Instagram, Facebook, and YouTube is a profitable choice.
Instamojo saw a 23 percent rise in new users who logged in via phones. 40 percent of the entrepreneurs on Instamojo that signed up in 2021 had a business profile on social media.
2022 will see massive budget expansions on influencer marketing, especially on micro-influencers as they have a better grip on niche categories. To replicate the mall experience, people are hopping on social media LIVE streams to shop while feeling like a part of a community.
5) Revenue-based financing takes centre stage
As homegrown and independent businesses rise in number, there will also be a significant shift to revenue-based financing over traditional venture capital. An increased consumer consciousness coupled with the rise in social commerce will make 2022 a golden year for Indian DTC brands.
6) DTC brands to spend 40% more on performance marketing
Homegrown independent DTC brands are leveraging the power of digital ads to widen their brand reach. DTC brands that will successfully scale in 2022 will be the ones that identify ways to reduce dependency on Facebook and Instagram alone.
