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Ecommerce in India- Statistics, Trends & Insights
Ecommerce in India- Statistics, Trends & Insights
By: Sahil Shah

 According to a report released by IMRB and IAMAI, the e-commerce market in India is expected to be a 31,598 crore valuation by end of 2010. A growth of almost 4 times of the market size back in 2007, the e-commerce industry is picking on the trend of the increasing number of Internet subscribers in India. Clearly the growth in the e-commerce industry has been tremendous with a larger audience accepting the ease of online payments.

 

 

 

The e-commerce market is projected to grow to 46,520 crore by 2011, which then will be a 400% growth in the last 5 years. What is more interesting is the breakup of the market, which is primarily skewed towards the online travel industry.

 

The following chart lays out the market size and breakup of the e-commerce industry in India from 2007 to 2010.


 

The above figure clearly states that the online travel industry accounted for 76% of the total e-commerce market in India in 2009. Although skewed since 2007, the non-travel industry is slowly capturing the market share percent by percent.The study states that e-Tailing is one the primary growth drivers and will remain so in the near future too.

 

The growth in the e-commerce sales is a clear indicator of the growing number of people using Internet to make purchases. But again, the online purchases are limited to a certain category of buying like travel purchases, electronic items, online classifieds, buying movie tickets, food delivery, gaming subscriptions, etc.

 

Inspite of such growth in the industry, not may people amongst the total online audience is making online purchases as of now. The trend of hunting for information online and then being followed by a physical purchase is still prevalent.

 

According to I Cube 2009, 13.6 million Internet users looked for information (LFI) while planning a purchase online. Of these, only 7.47 million actually purchased a product online. Thus only 50% of the users who look for information online end up buying too.

 


 

 

The shift is gradually taking place where an increasing number of people are making online purchases too. But the majority of the Internet audience is still averse to the idea of making online purchases due to the following reasons:

 


  

Besides for all these reasons, the E-commerce industry has shown great signs of growth due to the increasing awareness of the same amongst the net savvy Indians. The online travel industry seems like it will continue to dominate the e-commerce market, but e-tailing and digital downloads is expected to source the highest growth. The increasing number of mobile/digital downloads is in direct correlation to the high proliferation of mobile devices in the country among different users as well as introduction of interactive content over the Internet. Also many retail chains are opening up to embrace the medium to ensure there are sales over the Internet. This ensures reach in Tier-II and Tier-III cities where the early Internet users are being targeted for online purchases as well. The financial services sector is another area that holds promising growth in the future due to the ease and adaptability of online money managing services.

 The Internet users in India have time and again adopted the advancements in the online space and are always seeking out to include digital interactions into their daily activities - making purchases and indulging in transactions being one of them. The e-commerce industry on its own is poised to be one of the biggest markets in India. It will be interesting to see how and when will the e-commerce industry shape itself into a mainstream giant being accepted by the masses in the online space.

 

Tags: e-commerce, India, internet, statistics, trends, insights, online, purchase, buying behavior

Sahil is an Account Manager with WATConsult, a leading Social Media Agency who has worked on an array of brands like Gillette, Warner Bros, Sony Music, Virgin Mobile, etc. He also writes for a popular blog Penn Olson & has himself mentioned as a ‘Digital Media Expert’ in the Digital Media in India wiki doc. Follow him on twitter @sahielshah