Whether we credit it to the technological advancement in India or to the effect of the Covid-19 pandemic, there is definitely an upsurge in the volume of online transactions being done in India in the year 2020. Between February and June 2020, i.e., during the Covid-19 lockdown, Ecommerce in India has seen a growth of 117% with the delivery of just the essential commodities. Many players like Flipkart and Amazon have seen a steep rise in the number of their users.
Let us look at some of the figures now, which look quite promising. According to a report by Morgan Stanley, the Indian e-commerce market had a volume of 38.5 billion USD in the year 2017, and it is anticipated to swell up to 200 billion USD by the end of 2026. The credit for the increase in the growth of the market can very well be given to the proliferation in internet and smartphone usage.
The digitalization of the various activities taking place in India is likely to upturn the number of internet users to nearly 830 million by 2021, from the existing (approximately) 637 million. In India, nearly 6 million new users are getting added to the crew on a monthly basis.
This also means that there are new entrants on the other side too – the sellers! Since more and more offline sellers are finding a way to enter the online mode, they need an expert to assist them with digital marketing services, and that’s where Ecommerce SEO agency Orvador comes into the picture.
Reasons Behind the Growth of E-commerce in India
Even though India is considered a little “conventional” when it comes to online shopping, there has been a good deal of progress in the e-commerce sector in India, recent times. The following are the reasons behind the upsurge of e-commerce in India:
- Digitalization – The campaign called “Digital India” aims at connecting the most remote areas of the country through the digital platform, by improving the online infrastructure. The efforts of the Indian government are undoubtedly proving to be fruitful. Due to the availability of smartphones at affordable prices, the introduction of economic internet plans, more and more online users are adapting to the E-commerce way of doing day to day transactions.
- Easier and Safer Payment Options: Thanks to the increased numbers of payment gateways and UPIs, payments have never been easier. Availability of e-wallets and instant vouchers has made the payments much more convenient; PhonePe, PayTM, AmazonPay, etc. are some of the best examples. Even though “cash on delivery” has always been the most preferred way payment for the Indian customers, many people have shifted towards internet banking, credit cards and other easier and secure payment options. “One touch payment” is yet another revolution in the payment systems.
- Modernized Logistics: There was a time when connectivity was an issue in India, but not anymore. E-commerce is all about proper supply chain management and forward-backward integration. Due to the availability of efficient domestic and international courier services that are constantly trying to look for ways to improve their process, e-commerce is becoming more popular among MSMEs in India. Deployment of new-tech applications such as GPS tracking facility, RFID tracking, etc. has made e-commerce even more efficient. Apart from this, employing aggregators and partners such as Shiprocket has made the entire process flow even smoother and more cost efficient.
- “No-fuss” Shopping Experience: The biggest concern about online shopping in India was the post purchase satisfaction. Being a relatively “traditional” market, Indians used to be really sceptical about “what if the product is not as per the expectation”. The introduction of policies such as “No questions asked”, “Zero return charges”, “Free return pick up”, etc. has given a lot of confidence to the buyers. Product returns and exchanges are no longer a hassle. With the help of courier aggregators, the return to origin cost for the e-commerce operators has come down drastically, which in turn helps them offer better services to the consumers.
Investments and Developments in the Indian E-commerce Market
In order to understand the future of Indian e-commerce, it is necessary to understand what lies in hands. Following are some of the highlights of the investments and remarkable developments done in the E-commerce sector in India –
- 2017 saw 21 private equity and venture capital investments of value nearly 2.1 billion USD in the e-commerce sector. By the end of June 2018, the numbers increased to 40, of value 1,129 million USD.
- Amazon acquired 49% stake in a division of Future Group in August 2019.
- Reliance Industries, in order to boost their telecom industry and E-commerce venture Jio-mart, have put in a huge investment of 2.86 billion USD.
- Nykaa, a popular name in beauty industry, is planning to open more stores in tier-2 cities.
- To introduce and increase internet connectivity among rural women in India, Google and Tata have teamed up to create project ‘Internet Saathi’.
Future of E-commerce in India
Some of the experts predict that the Indian E-commerce industry will grow to be the second-largest online market in the world by the end of the year 2034.
In the recently concluded Google for India virtual event, CEO Sundar Pichai announced that the global conglomerate will be investing $10 billion in India, a major chunk of which has been earmarked to strengthen small businesses, by utilising technology and artificial intelligence. This investment, which will happen over a span of about 5 years, will be a game changer and perhaps prove as an incentive for more businesses to move online.
While most small businesses will be petrified at the concept of leaving their brick and mortar store and going online, it is actually much easier than most of them think. With ecommerce platforms such as Shopify, owning your online store is quite easy and the biggest benefit is that platforms such as Shopify are meant solely for smaller business owners. Whether it’s a product you sell or a service, you will be able to set up your online store with ease and reach out to a much larger audience.
With the availability of enhanced and easier options of purchasing mobile phones, laptops, and tablets online, we can anticipate more and more internet users and online buyers. This would, in turn, increase the penetration of E-commerce marketing agencies in the Indian markets. The E-commerce agencies may bring up newer versions of their applications and websites to make them compatible with a wide range of devices. Also, e-commerce stores, in a lookout for more customers, may come up with better discounts and promotional offers.
India is seeing tremendous growth in technology and infrastructure. As such, due to digitalization, there is a lot of potential for e-commerce in India. Even though many of the e-commerce agencies are still waiting to cross the break-even point, they are not going to shy away from putting more and more efforts and capital into marketing and promotions to woo the Indian online customer. Orvador (growth-driven SEO and Digital Marketing agency) will be able to help, because we can provide the help required to reach out to the target audience more effectively and quickly.
The Indian Government is taking bold steps to aid the E-commerce sector in the country. As already mentioned, the higher percentage of India belongs to the “conventional customers” category, which would still prefer to go to a “kirana” shop to procure their staples. Hence, there are “miles to go” for the e-commerce way of doing business to outdo the offline way. Every E-commerce company is aiming at making online shopping “a regular habit” among the Indian shoppers. An extended effort is an endeavour that is essential here for every E-commerce entity in India.
In the days to come, local businesses will have to spend more on local SEO and paid advertisements on social media sites such as Facebook and Instagram. The maths is simple – people tend to spend a lot more time on social media platforms such as these and when they see advertisements, the chances of them visiting your website and that lead turning into a real sale go up high. However, this also means that small and medium businesses will have to spend more on inculcating keywords in their content
that will be more in keeping with the local markets to ensure better SEO. However, when it comes to Ecommerce stores SEO, store owners tend to make several SEO mistakes where Orvador can really help them excel the organic growth and rank better in Google
The E-commerce industry in India isn’t a standalone operation. With the presence of necessary allied partners, it will be indispensable to take them along in the path of growth. This would involve funding, technology, and training to the various small and medium scale enterprises that are directly or indirectly linked with an e-commerce organization – a more “holistic development”. E-commerce companies pertaining to the MSMEs category can benefit from the larger players in the market. With the help of a little intervention from the government, ecommerce may grow to its zenith in India very soon. Global E-commerce giants such as Amazon are working hard towards bringing up a change in the Indian Ecommerce industry, and we hope to see a lot in the coming times.
Keeping aside the adversities caused, Covid-19 has struck as a blessing in disguise – especially for the companies dealing with online buying and selling. I believe, since online shopping is becoming a matter of habit, we can certainly expect a higher volume of transactions in the future, even after the pandemic is over. With the continuous infrastructural developments, support from the government, and innovative strategies by the e-commerce companies, India definitely promises a bright opportunity for the e-commerce businesses.
Let me know your thoughts about Ecommerce future in India in the comment section below.