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Future of eCommerce in India and its significance to a Common Indian Customer

Having noticed a tremendous innovation and growth in the Digital Transformation space, I wonder what it would mean to be a normal Indian consumer, who is now experiencing these changes. In this blog, I attempt to understand and bring forth the perspective of their experience on these wonderful E-commerce sites.

E-commerce in India is experiencing an exponential growth which shall continue for years to come owing to the penetration of Internet / Mobile in the untapped rural population and increasing user base in the Tier 2 and Tier 3 cities. This is coupled with the ever increasing coverage of diverse products in the E-commerce platform.

I can hardly remember the time when I have bought a book from a Brick and Mortar shop in the last 6-7 years, thanks to Flipkart and Amazon, but I can bet I never bought anything online before that period. It's a drastic change which many of us would have experienced. 

The most important driving factor for the success of E-commerce in India is increase in the level of trust for both the buyer and the seller. Since in the virtual world we don't have the privilege of touch and feel, which are basis for gaining trust, it becomes all the more challenging to persuade someone to buy.

Some other Entry barriers to E-commerce in India:

1. Perception of product is missing in the Online Purchase - Indian buyers still prefer brick and mortar where we can try the product before purchasing
2. India lacks aggressive consumer protection law - People are still skeptical about the quality of product purchased online. Most are still unaware as to where they can file their grievances in case bad quality products are delivered.
3. Penetration of Credit card is low especially in rural areas

Success Stories:

But despite these challenges we have the success stories of Flipkart, Snapdeal etc. They have successfully penetrated the entry barriers and are now perceived as trustworthy medium to perform Online shopping having won confidence both of the customers and the vendors.

Positive Indicators for E-commerce in India:

1. Internet banking / Phone Banking. High speed broadband internet penetration is increasing at a fast pace. People are getting accustomed to using Internet / Mobile banking to pay their bills, buy tickets and perform various financial transactions.

2. Penetration of Mobile devices, smart Phones. There has been a tremendous growth in the number of people using smartphones, tablets, and mobile devices. According to a recent survey, The Mobile phone will be used by over 90% of the Indian population by 2015. M-commerce has picked up in the Digital Market place.

3. Increase in the credit card users. According to Credit Information Company CIBIL there is increase in the usage of credit cards in the last few quarters. There is around 30% increase in average balances per borrower in the last one year.

4. Encouragement of the vendors - Vendors are encouraged to sell their products through Digital Commerce channel. The offers that they provide to the aggregators are passed on the end buyers as attractive discounts.

5. COD - The Cash - On - Delivery being offered by some E-commerce providers intend to break the Entry barrier which existed due to skeptical nature of costumers on Online payment.

6. Availability of large variety of product range which is generally not available in a single brick and mortal shop.

Therefore, E-commerce in India has a bright future especially in the B2C scenario thanks to the huge Indian population base, which provided a vast domestic consumer base and is now being exposed to latest technologies. According to a survey conducted by ASSOCHAM (Associated Chambers of Commerce and Industry of India), online retail industry is likely to cross 70 billion by the year 2015. In future we expect to see much more innovation in this space with the introduction of Mobile money, virtual trial platform and many others. Happy Shopping Online to all.


This is really good post.Please carry on.

Thanks for sharing wonderful information.

Yes the future of ecommerce is really good but right now companies like flipkart, snapdeal, rediff, jabong are all struggling to get more funding as their valuation by the investors have gone down in the market. The only player which remains on top for the last 10 yrs is Amazon. And soon biggies like amazon and alibaba will take over the other smaller companies in the market.

Thank you for having taken your time to provide us with your valuable information relating to your stay with us.we are sincerely concerned.., Most importantly, you Keepit the major..

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