Digital commerce market in India is likely to touch $128 billion in 2017 from the current level of $42 billion in 2015 due to increase in mobile and internet penetration, m-commerce sales, payment options, exciting discounts, according to the joint study brought out by Assocham and Deloitte.
The digital commerce market in India has grown steadily from $4.4 billion in 2010 to $13.6 billion in 2014 and it is expected to touch $128 billion mark by 2017, the study reveals.
While releasing the paper DS Rawat, Secretary General, Assocham said, “the supply chain and logistics in e-commerce business are highly complex to manage in a vast country like India where infrastructure is not well-developed to reach every remote and rural area.”
“The taxation policies for the e-businesses are not well-defined depending on different business models and transaction types. The complexity has further amplified with transactions happening across borders for online selling of goods and services. Moreover, e-businesses do not take sufficient steps to deploy a security solution, which is hindering the consumer rom transacting online,” he added.
Newer technologies that could significantly bring a paradigm shift in the online businesses are analytics, autonomous vehicles, social commerce, and 3D printing. Companies have started to invest in data analytics to gain real-time insights into customer buying behavior and thus offer personalized user experience. The e-commerce companies are building communities on social media networks to better understand customer needs and to drive effective marketing strategies, noted study.
The future of e-commerce is bright and growth will come from mobile platforms, personalization, social media analytics, omni-channel service, and sharing economy business models. The e-commerce industry is an exciting place with the interplay of social, mobility, analytics, cloud (SMAC), digital, 3D and, virtualization. The current high valuations, in spite of losses, perhaps, are indicative of the future potential.
Increasing internet and mobile penetration, growing acceptability of online payments and favorable demographics has provided the e-commerce sector in India the unique opportunity to fundamentally alter the way companies connect with their customers.
There are about 930 million wireless subscribers in India. The wireless teledensity in urban areas is in excess of 140 while there is still huge potential in rural areas with teledensity of 44. A significantly large percentage of this subscriber base in India will be using mobile devices to access internet, estimated at 235 million users as of September 2014 and growing rapidly. This rapid spread of mobile internet, especially of smart phones could unlock a significant market beyond the Tier 1 cities for the online retail segment. Undoubtedly, mobile retailing is expected to continue to grow aggressively. In the next three years, global e-commerce sales made via mobile devices are expected to top $638 billion.
In India, online shoppers are expected to increase from 20 million in 2013 to 40 million in 2016. An additional 200 million Indians will access the internet in the next three years, with majority of them coming online through smartphones.