Driven by faster growth in goods than services, ecommerce market in India is expected to quadruple to $60-70 billion over the next 5 years, according to a recent report.
The report titled ‘Retail 2020: Retrospect, Reinvent and Rewrite’ jointly prepared by the Boston Consulting Group and the Retailers Association of India was released during the Retail Leadership Summit 2015 held in Mumbai this week.
The report says the number of Internet users in India is expected to increase 3 times from around 200 million in 2014 to around 600 million by 2020. Likewise, proliferation of smartphones will also increase from 120-140 million in 2014 to 600-700 million in 2020.
The increase in the number of Internet and smartphone users will be due to lower cost of connectivity and improved quality; and expanded reach in lower tier cities and rural areas due to investments in network infrastructure.
According to the report, customers will get attracted to ecommerce because of superior value proposition on several counts—broader assortment, higher discounts, and greater convenience.
Further, ecommerce growth will also be aided by efforts of players to develop payment channels (cash on delivery, mobile wallets) and streamlined logistics infrastructure.
The report suggests that India retailers should proactively conceptualise and execute a digital strategy with clarity on why shoppers purchase online. The retailers are also advised to smartly leverage social media to drive word of mouth, and design a seamless and connected customer journey as shoppers migrate across channels.
