Indian e-commerce industry highlights

Indian e-commerce industry highlights

• The Indian e-commerce industry has been on an upward growth trajectory and is Indian e-commerce
expected to surpass the US to become the second largest e-commerce market in the market (billion USD)
world by 2034
250
• The e-commerce market is expected to reach US$ 64 billion by 2020 and US$ 200 200
billion by 2026 from US$ 38.5 billion as of 2017 150
100 200
50
39 50 64
0
2017 2018 2020 2026 F

Internet users in India

(million) • With growing internet penetration, internet users in India are expected to
1000 increase from 481 million as of December 2017 to 829 million by 2021.
800 • Rising internet penetration is expected to lead to growth in ecommerce.
600
• India’s internet economy is expected to double from US$125 billion as of
400 829 April 2017 to US$ 250 billion by 2020, majorly backed by ecommerce
700
200 481
0
2017 2020 2021

Year

Source: https://www.ibef.org/download/Ecommerce-February-20181.pdf
 Growth Drivers
• As the awareness of using internet is
increasing, more and more people are
being drawn to E-commerce.
Increasing
Awareness • Whether it be sellers, buyers, users or
investors, people have started getting
used to online mode of commerce.

Growth
Drivers
• Government initiatives like
Digital India are constantly
• Increasing FDI inflows, domestic
introducing people to online
Government investment, support from key
modes of commerce. Investments
Initiatives industrial players is helping in the
• Favourable FDI policy is growth of ecommerce.
attracting key players.
Where is the compass pointing to?

From Company perspective

Another round of fight for

Market share by deep
Higher Consolidation
discounts driven by entry of
Reliance Jio

Big established players

willing to let go of some Scope for expansion into
market share for better rural, tier 2 & tier 3 markets
profitability
 Where is the compass pointing to?

 Increased Choices
From Consumer  Better prices
Perspective  Consumer tilted business atmosphere
 Better penetration & availability
 Porter’s Five forces analysis

NEW ENTRY
HIGH

THREAT OF
LOW
• Very little cost involved in setting up
• There are many suppliers in ecommerce website
the market,. • Over 4700+ e commerce start-ups are active
• The ecommerce companies in the space over past decade
have the power to choose
their suppliers

SUPPLIER COMPETITI BUYER POWER

POWER HIGH
VE RIVALRY
• There are many players in
the market with similar
products and there is no

SUBSTITUTIO
THREAT OF
HIGH switching cost.

• There are a lot of local retailers with similar • Buyers prefer the company

N
products; and there is no switching cost for that offers the best price
customers. among other factors.
 Embracing digital tech

Positive change in consumer behavior towards

ecommerce
Effect of the
Change in purchase behavior
pandemic on
consumers Changing preferences

 42% of Indian urban active internet users are

shopping online during the pandemic (half of those
being first-time online shoppers)
 46% of these ‘new to online shoppers’ live in Tier-1
and 2 cities
 Increasing market share when compared to offline
retail
Effect of the
Increased problems for smaller ecommerce players
pandemic on with inadequate pockets
fashion e- Consolidation
commerce
players Closures

Opportunities to expand
 Recommendations
Product
Increase visibility by focusing on niche or innovative
products and then expanding from it
Operational
changes
Reduce cost to increase the sustainability and pass
on the benefits to the customer, Use technology to
enhance visibility and trackability, Agile inventory
to meet customer demand
technology to perfectly measure an individual's size and fit and use technology
Customer
trust/loyalty
Customer
experience
Be reachable (Prompt customer care), Be
Personalised marketing, Vernacular transparent (return policy, refund policy), Show
languages, Advanced filters, On time testimonials, Build Security and seek feedback
delivery, Minimum downtime of site,
simple UI, quality management and latest
technology
Increase reach
Reduce returns
Employ digital marketing and also focus
Over 20-30% of orders are returned because of size fit issues, using AI on tier 2 and tier 3 cities for their
untapped potential
to give better recommendations
Thank You !!