E-commerce is redefining India's fast growing fashion market

India’s e-commerce fashion market has grown by 10% to 12% in 2023, outshining growth in the broader fashion market, which grew by only around 6%. As a result, e-commerce’s slice of India’s fashion sector increased from 14% to 15%, according to research from Redseer Strategy Consultants.

E-commerce is big business in India, where the use of smart phones and internet has been increasing at incredible rates in recent years. More and more Indians are now able to explore fashion trends and access deals from the comfort of their homes.

The fashion industry has often out-performed the wider retail industry, but 2023 was the exception where the two in fact expanded at the same rate. That was mostly due to inflationary pressures and a subdued job market, which translates into weaker consumer spending.

Despite that, e-commerce fashion players were able to stay resilient and even see growth while brick-and-mortar retailers struggled. That is impressive for an economic environment in which consumers are holding back on spending on any type of luxuries.

India’s retail sector was valued at around $950 billion in 2023, with around 10% of that being fashion. In accounting for the recent rise in value of e-commerce fashion, Redseer Strategy Consultants points to convenience, variety, and irresistible deals. New categories, trendy products, and the fervour for fast fashion have all led to more purchases.

Expendable income was another driver. In India, it was the wealthier group of consumers that helped to drive growth in the fashion sector – including the growth of online fashion brands.

“Currently valued at around $93 billion, the fashion market is expected to grow to approximately $200 billion by 2030,” according to the authors.

“That’s almost double the growth within six to seven years. With evolving human desires and needs, on-going consumer interest in fashion will always be preserved. Moreover, retailers must not overlook the increased spending capacity that continues to drive this dynamic market forward.”

The online fashion sector is expected to steal the show in this growth. Growing from now until 2030 by an incredible $36 billion, the projection by Redseer Strategy Consultants sees e-commerce fashion expanding by 20% annually.

A previous report from Bain & Company also predicted major growth in India’s e-commerce fashion sector.