There Is Internet Fatigue, But D2C Growth Has Not Slowed Down: WOW Skin Cofounder

Online shopping saw an overwhelming growth during the last two pandemic-ridden festive seasons, however, with the effect of the pandemic receding, internet fatigue has set in and people want to go out to shop now, WOW Skin Science cofounder Manish Chowdhary at Inc42’s ‘The D2C Summit 3.0’.

However, the D2C businesses have not slowed down yet, although there might be a course correction in terms of businesses. “We will be looking at some interesting numbers this festive season,” Chowdhary said.

He was speaking at a panel discussion on the topic ‘D2C Goes Festive: Winning Strategies To Tap Seasonal Boom’. It also saw participation from Ayushi Gudwani, founder and CEO of FableStreet; Shantanu Deshpande, founder and CEO of Bombay Shaving Company; and Swati Bhargava, cofounder of CashKaro. 

Chowdhary said that consumers now want to go out and buy post the pandemic. However, WOW Skin Science is not only relying on the D2C channel for sales, he noted. 

Bombay Shaving Company’s Deshpande also acknowledged that there is internet fatigue. However, he said that his D2C grooming and personal care startup also invested in offline distribution during the last two years. The startup earns only 8% of its revenue through the D2C channel, while 40% comes from offline channels, he said.

FableStreet’s Gudwani also expects to see a sharp growth in the festive season this year compared to the last year. Although a significant chunk of demand will go offline, the impact depends on the category as well, she said, adding that categories like gifting and electronics are unlikely to see much fall. 

Besides, as FableStreet has moved from a single brand to a house of brands model and expanded its offerings beyond western wear segment, Gudwani is expecting a sharp jump in festive season sales this year.

Meanwhile, Swati Bhargava, cofounder of CashKaro, is also optimistic about the festive season as the understanding about how CashKaro works has increased. Besides, the cashback and coupons startup works across categories which gives it an edge, she noted.

“We are expecting a 3X increase this festive season. We sent 1 Mn clicks to AJIO in five hours. So traffic is there. We do expect an increase,” she added.

As per Bhargava, electronics will ‘unsurprisingly’ drive festive sales this year. Besides, credit cards and some other segments in the finance category are also offering cashbacks, she said, adding that she doesn’t believe that there is high fatigue in the D2C segment.

The Indian ecommerce industry is gearing up for the upcoming festive season and is expecting a sharp growth in sales during the first pandemic-free season in three years.

According to an Inc42 report, the Indian D2C segment’s total addressable market opportunity Is projected to surpass $302 Bn By 2030, growing at a CAGR of 24% during 2021-2030. In the first six months of 2022, D2C startups raised $1.3 Bn across 119 deals. 

In the D2C segment, the FMCG category beat the fashion category in terms of total funding during Q2 2022. Of the total $0.6 Bn funding raised by D2C startups, 59.7% went to FMCG brands, while fashion brands raised 32.5% of it.