The Indian e-commerce market is burgeoning with higher growth rate in recent times. It is set to overtake the US and emerge as the second largest in the world in less than two decades. It’ll then go head-to-head with China for becoming the largest e-commerce market of the world. The 28% growth per year of e-commerce in India has opened floodgates for opportunities in the sector. Such remarkable growth has changed the way Indian people transact.
The burgeoning growth in the number of internet users, especially young people are now engaged in online activities on a large scale. From using social media to accessing information, people are getting dependent on internet for their entertainment as well as education.
E-commerce have boosted the online availability of goods and services. The use of digital platform for commercial purpose is becoming a full-time business for various firms and organisations. The emergence of online retail market is one of the biggest revolution in the field of trade and commerce.
India is at the peak of digital revolution. Internet has become an essential part of the lives of urban population. The major factors that have boosted internet’s usage are as follows:
- Decreasing broadband subscription prices
The internet service providers have reduced their subscription prices in recent times which has a created a boom in the total internet usage of the country. People can access the internet without paying more money as compare to the prices of previous years.
- Launch of 4G VoLTE, 3G
The launch of 4G VoLTE after 3G has provided a lightning fast internet speed for smartphones and tablets. It has enabled the users to transact online just by few taps and clicks. Reliance Communications’ Jio is providing free internet to its users which has revolutionised the Indian digital system.
- Urban India’s high standard of living
The urban population of India is focusing on better lifestyle and high standard of living. From paying bills to booking travel tickets, they’re benefiting from the internet as a user-friendly tool for multi-tasking. It’s helping the people of India to improve their lifestyle creating a more digitalised and hassle-free environment for them.
- Convenience in online shopping
Online shopping is considered as the biggest key-trigger behind boosting the e-commerce sector. People can buy a product or book a service just by few clicks and taps on their phone/desktop screens. Access to proper information, availability of buying options and secure payment modes have created online shopping more convenient.
- Advanced digital infrastructure
The growth of internet on a global scale has allowed India to build its own internet infrastructure based on low-energy, high speed, borderless, instant and almost free digitalised platform. People are focusing on enhanced use of internet to live, work, stay informed and entertained, and to socialise over online media using certain devices and gadgets.
The e-commerce market of India is mainly divided into 3 sub-sectors:
- Online travel
Online travel has been the traditional e-commerce market in India. Lots of travelling packages, hotel bookings, e-ticketing for rail and flight tickets, etc. are the major services provided in this sector.
- Online retail
Online retail has given re-birth to the e-commerce sector of India. The rapid growth of online retail plays a significant role in the development of e-commerce and Indian economy as well. Big players from all around the world are engaged in the online retail sector of India due to its diverse population and ever-increasing demand for goods and services.
- Online classifieds
The earliest entrant in the e-commerce sector, online classifieds is a well-developed sub-sector. From accessing a directory to buy/sell a car online, online classifieds can help the user to find a domestic babysitter just by few clicks and taps. The second highest population of the world needs such classifieds daily. Therefore, the scope for online classifieds in India is getting more vast.
Challenges for e-commerce sector in India:
- Absence of proper regulatory framework and laws
- Low entry barriers resulting in reduced competitive advantages
- Rapid transformation of business models
- Shortage of skilled-manpower in the sector
- Lower scope in rural region as compare to the urban region
- Consumer loyalty
With the support of the government, the e-commerce sector is overcoming the above challenges and has maintained its sustainable growth ensuring the future of a Digital India.