In this day and age of information where data is king, opinions and feelings have no place if data disagrees with them. Because data is absolute. On Saturday, February 16, at YourStory.in’s eSparks event, world’s premier business intelligence provider, comScore’s India director, Kedar Gavane de-mystified the eCommerce space in India with the help of data. Kedar’s talk had some interesting facts and numbers about the state of eCommerce in India. Here’s a snapshot –
India, the fastest growing eCommerce market in the world
Between December 2011 and December 2012, India saw a 50% growth in the number of Internet users. With 139 million Internet users, India accounts for 75 billion pageviews worldwide. Indians spend 52 billion minutes on the internet and last year alone, India added 15 million eCommerce users. eCommerce growth in India has also been directly proportional to Internet penetration in India.
Kedar revealed that India has leap-frogged Brazil and Russia to become the fifth largest eCommerce market in the world, behind China, Japan, Germany and USA. As of December 2012, India had 44 million online retail visitors which is only 62% reach of e-commerce among online users. The worldwide average is around 73%.
User demographics – Age and gender
75% of India’s eCommerce users are below the age of 35. More number of transactors fall in the 35 – 44 age group. The younger segments, which is anybody below the age of 35 are the dominant population in the Indian online space. These younger users interact more with the site and post reviews about products, engage with these companies on social media and such. Kedar said there is also an increase in visitor loyalty – the Indian eCommerce user makes six visits a month to an eCommerce site. Off which 60% users are men and 40% women, which is consistent across all categories of products.
Entry points – where do eCommerce users come from?
In his presentation, Kedar shared that over 95% of eCommerce come from social media portals. The second largest source for eCommerce users is search. Other popular sources among eCommerce users include entertainment sites, news sites, e-mail and jobs sites.
Kedar also revealed that online retail has 1.5 times more reach than online travel. Social media marketing and SEO which has been conventional online marketing techniques will continue to be so. Kedar also revealed that social media will continue to be used for branding and to build a following.
Payments – the preferred means and the future
Cash on delivery (COD) continues to be the preferred method of payment for most eCommerce transactions in India — upto 58% of all Indian eCommerce transactions are paid via COD.
The next most preferred payment method is through debit/credit cards(Visa – 11% and MasterCard – 18%), followed direct debit and net banking. Kedar also pointed out that COD is on the decline and more customers are taking to debit/credit card transactions and 2013 could be the year when the skews change.
COD was the catalyst that gave a boost to the Indian eCommerce market. And as the industry matures in metros, COD may open opportunities for companies to tap customers in Tier 2 and Tier 3 cities. In Tier 1 cities adoption of online methods of payments can improve, provided the payment systems are made more reliable and penetration of credit/debit cards increase.
Winning categories now and for the future
Consumer electronics is the most successful eCommerce category in India and because of the nature of products, comparison shopping has also seen an upsurge in the recent past. Fast on its heels, is the fashion category. Apparel as a sub-category has seen the highest growth across all eCommerce categories – a whopping 208%, said Kedar. Other categories like home furnishing, healthcare and movie ticketing are all potential winners in the near future, which have seen a 100% growth last year alone.
India’s top eCommerce sites
On the basis of unique visitors Jabong, Amazon, Flipkart, Myntra and Indiatimes shopping are the Top 5 eCommerce sites in India. Each record over 5 million unique visitors per month, with Jabong leading the pack at 11.6 million followed by Flipkart and Amazon with 10.7 million each. Collectively, these five e-tailers cater to 26 million online shoppers, more than a half of total number of online eCommerce visitors in India alone.
Kedar concluded his session saying eCommerce leaders in India mainly belong to the electronics and apparel and the Top 5 are horizontal players, who have offerings across categories. Aggressive marketing and category expansion have also been important pillars of growth of these players.
Download Kedar’s complete presentation at eSparks here.
Check out comScore and learn more about their business analytics products here
We at YourStory.in thank E-Sparks Title Sponsor, Microsoft, Financial Technology Partner, Intuit, Associate Sponsors, ReferralCandy and Aramex and Exhibitor, Moolya.