The e-commerce wave gripped Indian market so swiftly that in no time there was a shift from brick to click. Now moving further, a joint study by Assocham-Deloitte asserts that the e-commerce boom is here to stay.
The ‘Future of e-Commerce: Uncovering Innovation’ study reveals that the digital commerce market in India has grown steadily from $4.4 billion in 2010 to $13.6 billion in 2014 and is likely to touch the $16 billion mark by the end of 2015 on the back of the growing Internet population and increasing numbers of online shoppers.
The report revealed that online travel accounts for nearly 61 per cent of e-commerce business while e-tailing contributes about 29 per cent. Visa India’s spend data showed 53 per cent growth in the number of e-commerce transactions in 2014, adds the joint study. Most popular e-commerce categories are non-consumable durables and entertainment-related products, it highlighted further.
“The greater adoption of Internet and smartphones is the biggest driver of e-commerce in India. Internet penetration is rapidly increasing with around 300 million users in 2014,” said D S Rawat, Secretary General, Assocham, while releasing the joint study.
The e-commerce companies are concentrating their efforts on increasing the penetration of their mobile apps for higher growth. Big players in this space claim to have more than 50 per cent of their revenue coming from mobile apps.
The availability of e-commerce applications on various mobility devices is helping to drive sales and revenue. E-tailers like Flipkart, Amazon and Jabong generate nearly 50 per cent of their revenues from consumers shopping via mobile phones. The m-commerce industry is shaping in light of the fact that more than 235 million people in India access internet through mobile devices, which is the primary reason for e-tailers to focus their efforts on mobile app penetration across the country.
Mobile applications are helping to reach more customers located even in remote and rural areas. E-commerce companies have been able to bridge the service gap considerably by sending service updates and other communication via their mobile app, e-mail, and SMS, adds the study.
The Indian online ad market will grow year-on-year at 30 per cent to reach Rs 3,675 crore by April 2015, adds the paper.
Also the big retailers are trying to complement the traditional retailing with digital commerce by tying up with big e-tailers. The partnership between Snapdeal & Croma or Amazon & Future Group owned Big Bazaar is no more a partnership between two retailers. It has extended to vendor and technology partners offering technology and logistics services.
Reliance retail is planning to launch its e-commerce website seeking to attract people from online retailers. Shoppers Stop is revamping its digital platform, and is planning to invest Rs.50 crore in its e-commerce business, which currently contributes 1 per cent of the revenue. The extended reach of the online channel is the primary reason for offline retailers to launch e-commerce offerings.
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