New Delhi: The lifestyle market in India is poised for significant growth, projected to expand at a Compound Annual Growth Rate (CAGR) of 10 to 12 percent, culminating in a valuation of USD 210 billion over the forthcoming five years. This forecast is based on a collaborative study by Bain & Company and Myntra.
The study highlights that the organized segment will be instrumental in driving the expansion of the lifestyle market, with the fashion segment poised to account for nearly 80 percent of this growth. The remaining segment, encompassing beauty and personal care (BPC), is anticipated to experience a growth rate of 10 to 12 percent CAGR, as detailed in the report.
Predicting the trajectory of this growth, the study anticipates that India's e-lifestyle market will surge from an estimated USD 16 billion to USD 40-USD 45 billion by 2028.
Several factors are expected to contribute to the robust expansion of the lifestyle segment. These include the easing of short-term inflationary pressures, alongside structural and favorable demand shifts. These include an increase in income levels, the emergence of fashion-forward, digitally native Generation Z shopper bases, and a heightened demand for organized and branded products, as observed in the report.
Moreover, the report identifies several additional factors that will propel the growth of the lifestyle segment. These include superior customer value propositions, such as trendy selection, faster delivery, ease of returns, a technologically enhanced purchasing journey, social media-powered discovery, and omnichannel accessibility.
This will not only bridge the significant market penetration potential in India compared to global markets like the US, China, and Germany, which boast e-lifestyle penetration rates of 35 percent or higher, but also accelerate the lifestyle market's penetration from its current level of 13 percent to 18-22 percent over the next five years, as detailed in the report.
Presently, the e-lifestyle sector is predominantly dominated by fashion, accounting for 75 percent of the market. The report further predicts that accessories and women's apparel will experience faster growth rates than other fashion segments. Additionally, beauty and personal care (BPC) has transitioned into the mainstream, achieving a penetration rate of 16 percent in 2023 and is expected to grow slightly faster over the next five years.
The report also identifies a significant trend driven by online platforms: the emergence of a trend-first fashion market in India. This market, characterized by a broad assortment and rapid refresh cycles, is projected to expand eightfold, reaching a valuation of USD 4-5 billion by 2028. Consequently, the online share of trend-first fashion is expected to rise to 50-55 percent, up from the current 30-35 percent.
In 2023, the study reveals that over 175 million customers across India engaged in lifestyle online shopping, transacting an average of 6-7 times annually. Furthermore, 40-45 percent of first-time e-commerce shoppers chose lifestyle as their initial purchase category, establishing it as a critical gateway category for e-retail. These online shoppers are increasingly visiting multiple platforms and engaging in more frequent visits, as highlighted in the report.
India stands as a pivotal market for leading international brands, with 90 percent of the top 50 global brands having established a presence within the country. Furthermore, approximately half of these brands generate revenue exceeding USD 30 million from their operations in India, as indicated by the report. The assurance in India's status as a significant lifestyle market is further highlighted by the introduction or upcoming introduction of over 60 global brands in the past year. This diverse range of brands includes those of scale, niche, luxury, and emerging trends across the fashion and beauty sectors.
