15 December 2023, Mumbai
From Pandemic Surge to $160 Billion Market:
The Rise of Online Shopping in India
Key Points:
- The pandemic has propelled India's online shopping, adding $8-$12 billion annually to its e-commerce market growth (2020-2028).
- The "How India Shops Online 2023" report by Bain & Co. predicts a surge from $60 billion in 2023 to a staggering $160 billion by 2028.
- 2023 will see a 17-20% growth, slightly lower than the anticipated 25-30% due to inflationary pressures.
- Big players like Amazon, Flipkart, and Reliance Retail's Ajio are ramping up investments to capitalize on this potential.
- India's online shopper base has grown remarkably, doubling its size between 2019 and 2022 with increased spending.
- Smaller cities (Tier II & III) and low-income/middle-income groups contribute significantly to the growth.
- Driven by new shoppers and increased fashion spending, the e-commerce sector is set for further evolution.
- The booming market is expanding the seller base, with over 10 million sellers expected by 2025.
Critical Insights:
- Social-commerce platforms are gaining traction, especially reseller-led models targeting first-time online shoppers.
- Quick-commerce and hyper-value commerce models are emerging, catering to convenience and affordability.
- Mobile internet penetration and improved logistics infrastructure are fueling the growth.
- The government's focus on digital initiatives like Digital India and e-commerce policy is also playing a crucial role.
Future Outlook:
- India's e-commerce market is poised for significant expansion, driven by a growing middle class, increasing disposable income, and smartphone penetration.
- Innovation and personalization will be key for brands to succeed in this dynamic landscape.
- Sustainability and ethical practices will gain importance as consumers become more conscious.
Overall, India's e-commerce market presents a promising future, offering immense opportunities for businesses and consumers alike.
5 Key Insights :
- Pandemic Boost: Online shopping surges, adding $8-$12 billion yearly to India's e-commerce growth (2020-2028).
- Market Explosion: From $60 billion in 2023 to a predicted $160 billion by 2028, fueled by new shoppers and mobile adoption.
- Tier II & Beyond: Smaller cities and lower-income groups join the online shopping wave, driving significant growth.
- Micro Trends: Social commerce, quick-commerce, and hyper-value models cater to convenience and affordability, shaping the future.
- Sustainable Future: Innovation, personalization, and ethical practices will be key for brands in this dynamic and promising market.
