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Ecommerce in India – Future Prospects

India has achieved a lot in the field of electronic commerce since its early days. The country has reached a mature status in the industry and new players have entered. Ecommerce in India not only includes online purchase of products but also various businesses involved on individual and corporate levels as ecommerce is used in many different contexts i.e. business to business, business to consumer, business to government, consumer to consumer, and mobile commerce.

India is still on the initial stages of development in the field of electronic commerce. The internet user base in India is lower as compared with the developed countries i.e. US and UK but the growth rate has been alarming for past few years. The increasing demands for a wider product range, faster broad band services, discounted offers, and gift vouchers have forced retailers to switch to an online presence. 2009 stats related to ecommerce reveal that the ecommerce market had contributed a business worth $2.5bn and it reached $8.5bn within two years. IAMAI stated that these figures reached $12bn plus by 2012.


The above mentioned graph demonstrates that the use of online content has increased to 70 billion pages per month in 2012 and it was just 54 billion pages previously. When we look at the demographic segments of internet users in India, it is observable [as mentioned in the graph below] that 75% users belong to 15-34 years of age group and females make 40% of the total internet user base in the country. This graph is actually a demonstration of demographic segmentation of online users based on age and gender.


India is categorized among one of the youngest user bases of the world and experts believe that this trend will continue in near future. Among all age groups, 15-24 years is the fastest growing user base and this includes both male and female. What these users search on internet is also varied on the basis of age groups and genders. Social networking sites, news portals, and entertainment sites are sought out the most.

Another analysis is based on BRIC Nations where India proves to be the fastest growing market with an annual growth rate of 41%. India is also considered among the top 3 fastest growing internet industries. The graph given below highlights the above mentioned facts.


Travel and retail industries have grown rapidly as compared with other segments of ecommerce in India. Aggressive advertising, convenient lifestyles, and consumer needs to buy products online has mainly contributed to retail growth. Travel e-commerce has seen a huge growth in terms of visitations and transactions and this trend is sure to increase in coming years. There is a significant growth in retail because a number of retailers tend to buy trial products and offer discounts and freebies to their customers. This change gives rise to transaction volumes and authority of these sites. To conclude, ecommerce has seen a measurable change due to models like cash on delivery and other consumer focused options such as quality of services that boost online sales overall.

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