Home / News / India /  Social commerce to be $7 billion opportunity by 2025: Redseer

The social commerce segment, which includes startups such as Meesho, Mall91, Shop101, Dealshare, and Bulbul, is expected to be a $7 billion opportunity and contribute at least 5% of the overall e-commerce market by fiscal year 2025, according to data from management consultancy Redseer.

Close to 80% of shoppers on social commerce platforms come from towns and cities beyond the top metros. While for horizontal platforms, including Flipkart and Amazon India, almost 40% of their customer base comes from top metros, the remaining 60% shoppers are from non-metro towns.

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“Different from other major e-commerce players, social commerce players are seeing the most growth from tier-II cities. From the $38 billion e-commerce industry in 2020, it is estimated that the entire e-commerce industry will grow up to $140 billion by 2025 and major social commerce players will contribute at least up to 5% by then," said Redseer.

According to Redseer, there are three kinds of social commerce models currently prevalent: the reseller model, group buying and live commerce. Reseller model currently is the largest; it allows resellers to sell products from suppliers, with social commerce platforms taking care of shipment and logistics.

The total reseller market in India was pegged at $600 million in 2020, according to Redseer.

“Resellers often prefer to join social commerce platforms to earn some extra money apart from their usual income, and also find personal recognition among customers and resellers as the platforms bring everyone together. Interestingly, many resellers in metros and tier-I cities also join these platforms to create a personal identity so as to become an influencer in respective communities," added the management consultancy.

Further, the growth of e-commerce in tier-II towns and cities, post the pandemic is also providing tailwind to India’s social commerce sector.

When it comes to categories, the social commerce sector has deeply penetrated into wear and accessories, which are largely unbranded and have low ticket size.

Currently, fashion dominates the sales on these social commerce platforms, with significant potential for home furnishing, costume jewellery and electronics accessories, to grow on these platforms among tier-II shoppers, said the management consultancy.

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