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    Growth of Ecommerce in India

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    Tittu Merin Joseph
    E-commerce is growing rapidly in India due to factors such as a large middle class, growing internet access, and improvements in payment and delivery infrastructure. While online travel currently dominates India's e-commerce market, sectors like retail and digital downloads are growing fast. Studies show India's e-commerce market has grown over 500% since 2007 and is projected to reach $10 billion by 2011, driven by continued expansion of internet access and more brands participating in online initiatives. However, challenges around payment methods, reliable delivery to rural areas, and technology adoption still remain barriers to further growth.

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    Growth of Ecommerce in India

    Uploaded by

    Tittu Merin Joseph
    439 views5 pages
    E-commerce is growing rapidly in India due to factors such as a large middle class, growing internet access, and improvements in payment and delivery infrastructure. While online travel currently dominates India's e-commerce market, sectors like retail and digital downloads are growing fast. Studies show India's e-commerce market has grown over 500% since 2007 and is projected to reach $10 billion by 2011, driven by continued expansion of internet access and more brands participating in online initiatives. However, challenges around payment methods, reliable delivery to rural areas, and technology adoption still remain barriers to further growth.

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    E-commerce is growing rapidly in India due to factors such as a large middle class, growing internet access, and improvements in payment and delivery infrastructure. While online travel currently dominates India's e-commerce market, sectors like retail and digital downloads are growing fast. Studies show India's e-commerce market has grown over 500% since 2007 and is projected to reach $10 billion by 2011, driven by continued expansion of internet access and more brands participating in online initiatives. However, challenges around payment methods, reliable delivery to rural areas, and technology adoption still remain barriers to further growth.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    439 views5 pages

    Growth of Ecommerce in India

    Uploaded by

    Tittu Merin Joseph
    E-commerce is growing rapidly in India due to factors such as a large middle class, growing internet access, and improvements in payment and delivery infrastructure. While online travel currently dominates India's e-commerce market, sectors like retail and digital downloads are growing fast. Studies show India's e-commerce market has grown over 500% since 2007 and is projected to reach $10 billion by 2011, driven by continued expansion of internet access and more brands participating in online initiatives. However, challenges around payment methods, reliable delivery to rural areas, and technology adoption still remain barriers to further growth.

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    Growth of ecommerce in india For developing countries like India, e-commerce offers considerable opportunity.

    E-commerce in India is still in nascent stage, but even the most-pessimistic projections indicate a boom. It is believed that low cost of personal computers, a growing installed base for Internet use, and an increasingly competitive Internet Service Provider (ISP) market will help fuel ecommerce growth in Asias second most populous nation. Indian middle class of 288 million people is equal to the entire U.S. consumer base. This makes India a real attractive market for e-commerce. To make a successful e-commerce transaction both the payment and delivery services must be made efficient. There has been a rise in the number of companies' taking up ecommerce in the recent past. Major Indian portal sites have also shifted towards e-commerce instead of depending on advertising revenue. Many sites are now selling a diverse range of products and services from flowers, greeting cards, and movie tickets to groceries, electronic gadgets, and computers. With stock exchanges coming online the time for true e-commerce in India has finally arrived. On the negative side there are many challenges faced by e-commerce sites in India. The relatively small credit card population and lack of uniform credit agencies create a variety of payment challenges unknown in India. Delivery of goods to consumer by couriers and postal services is not very reliable in smaller cities, towns and rural areas. However, many Indian Banks have put the Internet banking facilities. The speed post and courier system has also improved tremendously in recent years. Modern computer technology like secured socket layer (SSL) helps to protect against payment fraud, and to share information with suppliers and business

    partners. With further improvement in payment and delivery system it is expected that India will soon become a major player in the e-commerce market. While many companies, organizations, and communities in India are beginning to take advantage of the potential of e-commerce, critical challenges remain to be overcome before e-commerce would become an asset for common people. Indias ecommerce industry is on the growth curve and experiencing a spurt in growth. The Online Travel Industry is the biggest segment in ecommerce and is booming due largely to the Internet-savvy urban population. The other segments, categorized under online non-travel industry, include e-Tailing (online retail), online classifieds and Digital Downloads (still in a nascent stage). The online travel industry has some private players such as Makemytrip, Cleartrip and Yatra as well as a strong government presence in terms of IRCTC, which is a successful Indian Railways initiative. The online classifieds segment is broadly divided into three sectors; Jobs, Matrimonial and Real Estate. Mobile Commerce is also growing rapidly and proving to be a stable and secure supplement to eCommerce due to the record growth in mobile user base in India, in recent years. Growth drivers and barriers are present in equal measures for new eCommerce ventures. A report by the Internet and Mobile Association of India has revealed that Indiaa E-commerce market is growing at an average rate of 70 percent annually and has grown over 500 percent since 2007. The current estimate of US$ 6.79 billion for year 2010 is way ahead of the market size in the year 2007 at $1.75 billion. The following chart depicts the growth of E-commerce in India in the last couple of years.

    Apparently, more online users in India are willing to make purchases through the Internet. Overall e-commerce industry is poised to experience a high growth in the next couple of years. The 70 percent year on year growth is expected to continue and Indias e-commerce market is forecast to reach a whopping $US 10 billion by the end of 2011.The e-commerce market in India was largely dominated by the online travel industry with 80% market share while electronic retail (E-Tailing) held second spot with 6.48% market share.

    E-Tailing and digital downloads are expected to grow at a faster rate, while online travel will continue to rule the major proportion of market share. Due to increased e-commerce initiatives and awareness by brands, e-Tailing has experienced decent growth. According to the third edition of eBay India census 2010 conducted across 28 states and seven union territories, Indias top five rural e-commerce hubs are Ambalapuzha (Kerala), Sajiyavadar (Gujarat), Adala (Gujarat), Abdalipur (West Bengal) and Kangayampalayam (Tamil Nadu). This means there are two rural e-commerce hubs of Gujarat in top five across India. The survey reveals that Gujarat has emerged as one of the top five online shopping markets in the country. Gujarat is ranked 4th after Maharashtra, Delhi and Tamil Nadu. During the census in 2009, Gujarat was ranked at seventh, from which it has jumped to fourth position. The city of Ahmedabad ranks 7th among top 10 ecommerce hub in the country. eBay India, a 100 per cent subsidiary of eBay Inc one of the leading e-commerce hub in India , has observed a surge in the number of e-commerce hubs in India from 2,500 last year to 3,300 this year. According to the eBay Census Guide 2009 for Indian eCommerce scenario, it has been found that India has over 2,471 eCommerce Hubs. These hubs are the cities, towns, villages and smaller towns covering the entire length and breadth of the country. Technology or technology related products dominate Indias domestic eCommerce. Whereas, lifestyle product category dominates in the global trade. Technology, being Indias favourite traded vertical category contributes 44% of totals eCommerce transactions according to the latest eBay Census. Lifestyle category at 35% comes second in popularity for online Indians. For Global Trade, lifestyle is the clear winner at 64% of all transactions followed by Media & Collectibles at 15% each. Elaborating Indias domestic online shopping scenario, South India has the most active buyers at 41% of all transactions, followed by West India at 27%. However, West India has the most active sellers at 46%, followed by North India at 28%. Delhi entrepreneurs sold the most technology gadgets at 46% of all transactions to buyers in India. Lifestyle scored on the Exports front at 67% of all transactions Delhi sells the most musical instruments percussion, brass, synthesizers, and guitars - in the country. In addition to this, Delhi buyers bought the most

    sunglasses in the country according to the eBay census. Delhi buyers have also bought the most number of high end digital cameras in the country.India is showing tremendous growth in the Ecommerce. Rival tradeindia.com has 700,000 registered buyers and it has the growth rate of 35% every year which is likely to double in the year 2010. Indiamart.com claims revenues of Rs. 38 crores and has a growing rate of 50 every year. It receives around 500,000 enquiries per month. Undoubtedly, with the middle class of 288 million people, online shopping shows unlimited potential in India. The real estate costs are touching the sky. The travel portals' share in the online business contributed to 50% of Rs 4800 crores online market in 2007-08. The travel portal MakeMyTrip.com has attained Rs 1000 crores of turnovers which are around 20% of total e-commerce market in India. Further an annual growth of 65% has been anticipated annually in the travel portals alone.

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