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Ecommerce

India: e-commerce market to hit USD 9 bln by 2016

Thursday 18 April 2013 | 12:50 PM CET

The e-commerce market in India has reached about USD 600 million in 2012 and is expected to hit USD 9 billion by 2016 and USD 70 billion by 2020, recent results unveil.

According to a survey by Forrester, the Indian e-commerce market is expected to grow at a CAGR rate of over 57 percent between 2012 and 2016, which is the fastest within Asia-Pacific region.

The same source points out that the main factors that drive this growth are the rise of internet usage (growing at 20 percent) & 3G penetration and an increasing number of smartphone users with availability of internet on their mobile phones. Estimations show that currently there are 27 million mobile internet users in India out of which 4 percent are buying products via their mobile devices. The figure is expected to increase to 20 percent in the next four years. These factors accompanied by busy lifestyles, traffic congestion, lack of offline shopping time, great deals and discounts offered online and use of innovative e-commerce models such as group buying and second-hand sales have led to more and more consumers switch to online shopping. With the rising middle class incomes, global exposure and changing demographics (close to 50 percent of the population is less than 25 years of age), this trend also holds true for the Tier II & III cities.

Data indicates that online travel (76 percent) and financial services (10 percent) form the biggest component of online shopping followed by e-tailing (8 percent). While services such as travel tickets, movie tickets, restaurant discount vouchers, hotel bookings, utility payments, insurance policies and premium payments lead the wallet share of the amount spent online, product categories such as computers & accessories, cameras & mobiles, electronic durables and books are picking up.
 

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