Much of 2016 has been taken over by concerns about budget constraints and tightening purses in the Indian entrepreneurship domain as funds dry up. A significant impact of this has been on the e-commerce industry, which was one of the biggest spenders last year not only in terms of adding staff and expansion but also in customer acquisition, marketing and other similar functions.
Be that as it may, numbers indicate that the e-commerce business in India is still a fast growing sector. India is adding three Internet users per second and already has the second largest Internet user base globally. Deepening Internet penetration and growing number of smartphone users have taken the Indian e-commerce marketplace at $22 billion, as per PwC. The number is slated to grow over 36 per cent by 2020.
Various aspects of the business, along with growth drivers and barriers, were discussed at the inaugural Golden Cart Summit and Awards. The forum saw attendance from some of the most prominent entrepreneurs from the domain, investors and ecosystem enablers, all agreeing that e-commerce in India will continue to see growth. The current shakeup that includes the acquisition of Jabong or the shutting down of Taxi4sure, Exclusively.in and Big Bazaar Direct among others, are all creating a new order in chaos.
Experts at the forum conceded that e-commerce is fast approaching an inflection point leading not only to the rise of specialists and niche players but also to a place where related businesses, such as retailers, will contribute further to sector growth. With the e-commerce “threat”, businesses are placing a premium on efficiency and value. Retailers are pulling together large volumes of purchase data to fine-tune operations. Leveraging data and analytics will ensure higher returns on conversion and a competitive advantage for retailers and their e-commerce counterparts.
By 2020, e-tailing in India is expected to account for 3 per cent of total retail. Further, orders per million are expected to more than double from 5 million in 2013 to 12 million by 2016, which will mean more opportunities for both consumers and e-tail companies. While the share of online shopping in total retail has increased at a fast pace since 2013, it is still miniscule compared to the figure in China, where the share is 8-10 per cent.
Industry leaders at the summit believe the current numbers indicate a headroom for growth in the business. They pointed out that the two extremes of the business — the established players and the new ones — will continue to attract investments. It is, however, key for the sector that all players not only stay the course but invest further in ‘execution at scale’.
noor.warsia@digitalmarket.asia
