“India B2C E-Commerce Market 2018” is a new report published by Germany-based secondary market research company yStats.com. The report summarizes the key trends and projections for the market and unveils the top product categories, payment methods and shopping platforms preferred by India’s consumers. Yücel Yelken, yStats.com’s CEO & Founder, shares: “India has one of the fastest growing online retail markets in Asia-Pacific and worldwide. Through 2022, most of the growth is projected to stem from smaller cities and towns, as well as rural areas.”
B2C E-Commerce accounted for less than 5% of India’s overall retail sales in 2017. Just above one-third of the population was online, with an even lower penetration of those making purchases on the Internet. However, the young population, rising smartphone penetration and continuous investment of local and international companies in Indian E-Commerce are expected to foster the country’s online sales over the next several years. Through 2022, B2C E-Commerce sales in India are projected to grow several times faster than in China, also outpacing other leading markets in Asia and worldwide, according to forecasts cited in the yStats.com report.
A major contribution to this robust growth is expected to stem from tier-2 and lower cities and rural locations. By 2020, they are projected to account for more than 50% of India’s E-Commerce sales. The country’s two largest E-Commerce merchants, Flipkart and Amazon, already have strategies in place to win over the fast-growing online consumer base beyond metro areas. Recognizing the high market potential, Amazon is continuously investing in its Indian operations, while Flipkart reached an agreement in May 2018 to sell a majority stake to Walmart. Another international player which increases its focus on India is Alibaba Group. China’s E-Commerce giant has invested in Paytm, the third largest E-Commerce company and a mobile wallet provider, and more recently in a leading online grocer BigBasket.
While mobile phones and fashion remain the largest B2C E-Commerce product categories, online grocery delivery services are also seeing rapid growth rates, more than doubling in revenues between 2016 and 2017, according to estimates in the yStats.com publication. The report also reveals that a growing number of online shoppers in India prefer to pay by card or mobile wallet, although cash on delivery remains the largest payment method by share of online orders. Other findings include the rising importance of M-Commerce and omnichannel services, while cross-border opportunities are limited due to a high price sensitivity of Indian online shoppers.