The e-commerce industry in India has enjoyed an upward trajectory over the past few years. According to recent e-commerce statistics, India’s e-commerce industry is all set to become the second-largest market in the world by the year 2034, bumping the US from that spot.
The growth of e-business in India will also help the country become a major force in the e-business space with an estimated growth potential that will be just shy of $100 billion by the year 2024.
When it comes to e-commerce market share in India, fashion and apparel, and groceries are the top-performing sectors in the e-commerce sector in India These sectors are closely followed by consumer electronics, which is projected to experience a growth of up to 8% by the year 2025.
These stellar numbers are partly due to the global pandemic, which has left many consumers opting to shop online rather than step outside their homes. One reason for this incredible growth in the online shopping market in India is because of the growing penetration of IT infrastructure and cell phone and internet connectivity to rural areas of the country.
Apart from that, new government policies now encourage 100% foreign direct investment in B2B e-commerce businesses, which has also helped to propel the Indian online market. Keeping that in mind, here is a breakdown of e-commerce statistics in India that matter.
- History of E-commerce industry in India
History of E-commerce industry in India
As the use of laptops and smartphones increases in India, there has been a dramatic rise in the online consumer base of India. While shopping online is commonplace in India today, few people are aware that the concept of e-commerce was first introduced in 1991 when the internet didn’t exist in India. So, it’s safe to say that the Indian e-commerce market has come a long way since its humble beginnings.
An IRCTC has been trying to capture the Indian market since 1999
Rediff was the first IRCTC to create a successful e-commerce portal in India and has been working to capture a share of the Indian e-commerce marketplace since 1999. In other words, Rediff was the first company to introduce the concept of e-commerce in India.
One of the first Indian e-commerce platforms was acquired by eBay in 2000
Soon after the launch of Rediff, the Indian e-commerce space witnessed two major platforms in quick succession. A few months after India got its first e-commerce platform, IndiaTimes Shopping was launched along with Baazee.com. While both used a viable marketplace model, neither succeeded in convincing the Indian consumer to start shopping online. Baazee.com, however, was later acquired by e-commerce giant eBay, and thus, became the first Indian e-commerce platform to be acquired by a foreign company.
In 2002, the IRCTC taught Indians how to book tickets online
The Indian Railway Catering and Tourism Corporation is an e-ticketing system that taught Indians how to book their tickets online in 2002. As this system was founded by the Indian Railways and was under government surveillance, there was enhanced consumer trust and reliability on the platform.
Growth of e-Commerce in India
The evolution of e-commerce in India has been amazing, to say the least. The e-commerce industry in India was worth $38 billion in 2017. According to reports, this figure is expected to grow to $200 billion by the year 2026. This exceptional growth is going to grow further thanks to the number of internet connections, which has now risen to 760 million.
Online retail sales in India is expected to rise to 31%
According to reports, online retail sales are expected to rise to 31% in India, led by online marketplaces such as Amazon and Flipkart. These numbers have been projected to rise even higher thanks to the $95 million invested by Amazon India in Amazon Pay, its payment unit.
In 2019, e-commerce companies received $4.3 billion from private equity investors
According to reports, Indian e-commerce and consumer internet companies in 2019 received a total of $4.3 billion from venture and equity capital players. In contrast, the entire e-commerce market in India was worth just above $3 billion in 2009.
In 2017, the e-commerce industry was worth $24 billion
The Indian e-commerce industry made headlines back in 2017 when it reached $24 billion. Thanks to the tremendous growth that the industry experienced, it was considered by many to be the fastest-growing industry in India. In 2018, the e-commerce industry grew to more than $38 million, surpassing its previous growth numbers.
The online grocery segment of e-commerce in India is set to reach $29 billion by 2024
According to estimates, the online grocery segment, which is currently hovering around just $2 billion, is expected to rise to $29 billion by the year 2024. This is due to more people opting to shop for groceries online, thanks to reputable companies entering the niche.
Total online orders are expected to generate $100 billion online retail revenue
In India, online retail revenue is expected to grow to over $100 billion in 2021, according to research by Google India. Around $35 billion is going to be generated through the fashion and apparel segment, which has seen a sharp rise in sales over the past few years.
E-commerce as a share of India’s GDP
It wouldn’t be wrong to say that e-commerce has significantly impacted the Indian economy. This progress is owed to a noted increase in online sales which has played a significant role in fueling the economy that has been hit by COVID19.
The Indian e-commerce industry made up 0.76% of the country’s GDP
In 2016, the e-commerce industry made up for 0.76% of the country’s total GDP. However, today, the country is set to become the second-largest online market in the world, second only to China. This rapid growth is going to help fuel the GDP.
Over the next five years, online shoppers are expected to exceed 350 million
According to experts, the number of online shoppers in India is expected to go beyond 350 million over the next five years. This alone is going to help boost the e-commerce sector in India since more customers mean more money being generated via e-commerce transactions.
Online Gross Merchandise Value (GMV) is expected to rise to $120 billion
Thanks to the growing market penetration of e-commerce websites, the online Gross Merchandise Value (GMV) is projected to grow to around $120 billion over the next five years, which will act as a catalyst for driving the GDP forward.
E-commerce Market Value in India Expected to Grow to $200 billion by 2027
E-commerce sales in India have experienced ups and downs over the past few years. While the total e-commerce sales were up by 25 percent in 2018, this number has been projected to dip slightly this year due to the global pandemic. That being said, India’s e-commerce market has been stronger than ever and has been performing above and beyond expectations, considering the challenging circumstances ahead.
How Many e-commerce Companies are there in India?
The e-commerce space in India is bustling with activity. This has been mainly due to the pandemic where many folks are opting for shopping online rather than traveling physically to the stores.
There are more than 19,000 e-commerce companies in India
India has experienced sharp growth in the number of companies operating in the e-commerce space. According to recent estimates, there are more than 19,000 e-commerce businesses in India. When compared with the United States, which has more than 28,000 companies in the e-commerce space, India is not too far behind. In fact, according to e-commerce stats in India, those numbers are expected to grow in the coming years.
The growth rate of e-commerce sites in India has reached an 85% market share
According to reports, the e-commerce industry in India has reached a growth rate of 85%. Over the next decade, the e-commerce niche will command 6.5% of the total retail market in India. This has been due to the sharp increase in online shopping. As e-commerce portals continue to grow more efficiently, this number is expected to rise.
There has been a 71% increase in orders from April 2020
With lockdown restrictions firmly in place due to the pandemic and deep penetration of smartphones in India, e-commerce sites have witnessed a 71% increase in total orders in comparison to the same time last year. This trend is unlikely to slow down any time soon.
Around 7.6 million Indian consumers search for deals and discounts online
According to a recent study, over 7.6 million consumers regularly visit e-commerce sites for discounts and special offers. This is proof that online shopping in India is not going away any time soon. In fact, it is on an upward trajectory.
The Role Played by the Internet in e-Commerce Growth
It is no secret that the Internet of Things (IoT) has completely transformed the speed at which transactions are carried out online. This has also helped fuel the e-business space, with e-commerce websites growing more efficient at executing tasks, whether its order placement, responding to customer queries, or product shipments. Further development in the technology space is only going to grow the e-commerce sphere, with online retailers and payment gateways growing more efficient.
In 2019, around 55% of the Indian population was online
According to the World Bank’s World Development Indicators, 55% of the Indian population has access to the internet. This is a far cry from the number of Indians that had access to the internet in 2000, which was a meager 0.5%.
As of 2020, India has an estimated 700 million internet users
The total number of internet users in India in 2020 was 700 million. This figure is estimated to grow to 975 million by the year 2025. This not only indicates the potential for internet services in the country but the growing demand for online services, whether it’s carrying out business transactions or e-commerce shopping.
Smartphone numbers continue to increase at 8% annually
According to sources, year-on-year sales of smartphones have increased at a steady rate of 8% on average for the past few years. During the first quarter of 2020, smartphone use increased by 50 million units. This increase in smartphone usage numbers is mainly due to positive shipments of smartphones in the country.
Amazon set a record 60% increase in seller registrations in 2020
Due to the pandemic, which has resulted in a dip in offline sales, e-businesses have experienced positive growth with a nearly 60% increase in seller registrations on Amazon. This is an indicator that more and more brick and mortar retailers are making the switch or are expanding to online platforms to increase their sales numbers.
Online Shoppers Trends in 2021
The percentage of online shoppers in India is set to rise in 2021. While e-commerce sales were stunted at 8% during 2020 in India, compared to 20% in the US and China, e-commerce trends in India is growing steadily despite the COVID-19 outbreak. The Indian e-commerce market is now seeing big upsides in the number of online shoppers who are purchasing more online than ever before.
Digital buyer penetration in India for 2021 is estimated to grow to 28%
According to sources, digital buyer penetration in India is set to rise by 28% in 2021, which is significantly higher than the previous year. This number is strongly supported by an increase in the number of online sales and a growing trust in e-commerce platforms.
Statistics of online shopping in India indicate a growth of $1.2 trillion in 2021
The Indian e-commerce space is predicted to maintain its third spot at the largest e-commerce market in the world. According to estimates, the growth of e-business in India is going to reach 1.2 trillion in 2021. This is a huge leap from the retail market numbers in 2017, which was around $795 billion.
60% of Indian web users visit an online store
According to reports, an estimated 60% of internet users visit an online retailer in India. This is a massive rise in the Indian consumer’s behavior when it comes to using online shopping websites. Much of this growth has been powered by an increase in online consumer’s use of e-commerce platforms such as Flipkart, Amazon, and Myntra, etc.
Credit cards (29%) and digital wallets (25%): preferred payment modes of consumers
India is one of the largest e-commerce markets in the world. According to Indian e-commerce industry statistics, consumers are growing more confident in using various payment modes in India. Online retailing in India is being fueled by the growing use of digital payment systems such as credit cards, which have increased in growth by 29%, and digital wallets, which have grown to 25%.
Rise of Mobile Commerce
A growing number of internet connections and smartphone use has fueled the rise in e-commerce in India. Despite the global pandemic, more consumers are now making purchases via e-commerce stores.
Around 735 million people in India do not have access to the internet
According to estimates, the total population in India is around 1.4 billion as of 2020. Out of that number, around 735 million people still do not have internet access. This is why steps are being taken at a federal level to ensure more people have access to the internet.
In-app transactions make up for 82% of mobile e-commerce purchases
The increase in the use of smartphones has catapulted India’s e-commerce market to newer heights. According to research, in-app transactions now make up for 82% of total mobile commerce purchases. This number is estimated to rise even further as smartphone use increases in rural India.
The e-commerce industry in India is booming with a growth of $120 billion in 2020, which was significantly higher as compared to the $39 billion that the e-commerce space earned in revenue for 2017. A good e-commerce statistic in any country is the population, and more importantly, the number of people using e-commerce platforms.
As of 2020, the average annual e-commerce revenue is around $338 per user. These are incredible numbers considering only 28% of the total population in India uses online retail options to shop for products or services.