06 January 2016

Drivers for India’s exponential e-commerce growth

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That India is one of the fastest growing online retail markets is a no-brainer. It is the second largest nation of internet users with 375 million connected online second only to China. Of these over 235 million are mobile internet users. Driven by a growing, aspirational and cash rich urban middle class the digital e-commerce market has grown from $4.4 billion in 2010 to $16 billion in 2015. It does not hurt that India is the 5th largest preferred retail destination in the world.

A recent report by the Associated Chambers of Commerce and Industry of India (ASSOCHAM) identifies several key challenges as the digital marketplace expands on the subcontinent. Competition that sees companies undertake aggressive price cutting and discounting tactics, and high commissions for vendors are impacting profitability while logistics and supply chain infrastructure is an ongoing challenge. Equally tricky are the issues for payments in a country which traditionally balks at putting personal information online; which in turn makes cash on delivery the most preferred mode of payment as companies bring their card on delivery services up to speed.

However this is a market that is increasingly defined by innovation whether it is in business models, enabling technologies, supply chain and logistics or marketing strategies. Several start ups have moved into challenging retail spaces given the Indian conditions including grocery shopping and delivery, healthcare, realty and travel. Flipkart and SnapDeal are the leaders in the Indian market which Flipkart currently leading the chase. SnapDeal is expected to take the lead in 2016.

In his comment to the ASSOCHAM study Kunal Bahl the CEO of SnapDeal says “Unique changes to the existing business model which can get more sellers & customers to transact online, integrated and improved multiple touch points, identifying categories which drive frequency of usage coupled with innovative payments and quick delivery will be the key to success in the Indian ecommerce domain. It is critical for all players to build an ecosystem encompassing all the mentioned areas for digital commerce rather than just monolithic platforms. We, at Snapdeal, are constantly innovating our existing business model and bringing about such changes which will help us in not only improving the seller and customer experience but also stay competitive in this dynamic industry.”

Tony Navin, Senior Vice President Partnerships and Strategic Initiatives will be the international keynote speaker at the Akolade's upcoming 3rd Annual Online Retail Supply Chain Summit 2016 , giving the gathering a deeper insight into what makes India one of the most exciting online retail marketplaces in the region.




Geethanjali has a Masters in Communications and Journalism and is a documentary film maker and producer. She is also a senior conference producer with over 10 years of experience. Previously she was Director of the Asia New Zealand Foundation Auckland Officer and also worked as a reporter/director for a Television New Zealand show.

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