Within the early 2010s, India witnessed the emergence of its first wave of direct-to-consumer (D2C) manufacturers. The promise of this cohort of bold startups that aimed to bypass conventional retail channels appeared ripe: web penetration was rising, on-line marketplaces had been gaining traction, and early ecommerce adoption was starting to form a brand new sort of client behaviour.
Many of those manufacturers needed to grapple with distinctive challenges comparable to excessive buyer acquisition prices, evolving unit economics, and nascent logistics and funds infrastructure. These early D2C manufacturers needed to not solely construct their very own merchandise and companies, but additionally form client behaviour. The price of experimentation was excessive, and the power to iterate on product-market match was painfully sluggish.
Immediately, that actuality has remodeled. Belief-building and client schooling, as soon as important D2C speaking factors, are now not on the forefront. The D2C market is predicted to develop to $60 billion by 2027, rising at a 40% CAGR. in accordance with a KPMG report.
A number of enablers have pushed this modification. Platforms like Shopify have turned storefront constructing right into a weekend mission, whereas fulfilment gamers and conversion enablers have optimised logistics by means of supply reliability, return administration and cash-on-delivery complexities. Immediately, the ecommerce logistics sector is witnessing a growth, and the market is projected to achieve $7.8 billion by 2030 from $4.4 billion in 2025, at CAGR of 12.2%.
On the advertising and marketing entrance, a number of efficiency channels at the moment are bolstered by the influencer and community-led commerce, permitting for deeper, extra genuine engagement with customers.
This evolution means founders can now give attention to what actually issues: the product. They will launch, take a look at, study, and iterate, all inside tighter timeframes.
The consequence? The trail to $100 million in income has decreased considerably, in accordance with a Redseer Technique Consultants examine. Manufacturers are hitting that milestone in much less time and with much less capital, due to logistics, infrastructure, and client readiness enabling leaner, quicker progress trajectories.
A unique sort of client is rising
The primary wave of D2C manufacturers catered to a comparatively small section, largely city, price-sensitive buyers experimenting with ecommerce for the primary time. These customers had been cautious, discount-driven, and nonetheless constructing belief in digital procuring. The addressable market was constrained not simply by infrastructure, but additionally by client readiness.
Quick ahead to at present: India had over 345 million digital buyers in 2023, and this quantity is prone to exceed over 400 million by 2027. Extra importantly, a majority of those customers are prone to come from Tier II cities, a demographic that’s reshaping the narrative round on-line consumption, and now thought of a part of the broader “India One” client section. These prospects are discerning, value-conscious, model conscious, digitally fluent, and actively looking for out differentiated, quality-first merchandise.
This can be a pivotal shift. Premiumisation, as soon as thought of a distinct segment metro development, is now mainstream behaviour throughout classes. This shift helps manufacturers with stronger margins, higher retention, and sustainable progress.
On-line-first, not online-only
The primary technology of D2C manufacturers demonstrated early success by scaling on-line earlier than ultimately increasing offline to achieve the subsequent degree of progress. These pioneering manufacturers paved the best way for omnichannel considering, proving that bodily presence wasn’t at odds with digital DNA. Trendy D2C manufacturers will not be tied to 1 channel—they’re channel-agnostic.
However the greatest unlock is coming from Fast Commerce, a sector that’s poised to develop to $9.94 billion by 2029. Fast Commerce already accounts for sizeable income for high FMCG gamers, and D2C manufacturers are rapidly catching on.
The rise of deep vertical performs
Earlier, many manufacturers pursued horizontal growth to seize extra pockets share. However that playbook has now been flipped. Profitable D2C manufacturers on this new wave are narrowing in, not spreading out, as buyer loyalty is being constructed inside centered verticals, comparable to girls’s vogue, intimate care, pet diet, Ayurveda-backed wellness, and so forth.
Reasonably than making an attempt to be every thing to everybody, these manufacturers have gotten important to somebody after which scaling from that core. This creates not simply higher economics, however stronger client relationships that compound over time.
Information-led model constructing is the brand new default
Information isn’t only a software, it’s the inspiration of recent model constructing. Profitable D2C manufacturers will not be simply consumer-focused; they’re data-obsessed. They function extra like product labs, quite than conventional retail companies.
With entry to granular analytics and real-time buyer insights, manufacturers are always studying and iterating. This shift is not only operational, but additionally strategic. The actual moat at present is constructed not on design or aesthetics, however on intelligence.
A brand new playbook for client model constructing
This second wave of D2C is marked by insight-led decision-making, modular infrastructure, and a digitally fluent client base. It rewards founders who mix agility with long-term considering, those that don’t simply chase progress, however construct with endurance.
The profitable manufacturers might be these which can be in a position to marry pace with sustainability, mix distribution attain with genuine model belief, and construct not simply merchandise, however relationships and communities powered by knowledge.
For traders and operators alike, this isn’t about betting on fleeting developments. It’s about tuning into a brand new playbook, one which’s nonetheless unfolding, however extra grounded and executable than ever earlier than.
(Pavitra Gupta is the Director of Portfolio Growth at RTP World)
(Disclaimer: The views and opinions expressed on this article are these of the creator and don’t essentially mirror the views of YourStory.)
