Research from eMarketer has shown that retail ecommerce sales in India grew by 31% to reach USD 32.70 billion.
According to the research, growth has been driven by market leaders Amazon, Flipkart and Paytm Mall. All three companies have expanded into new sectors, including grocery.
Another important factor is the increasing internet and smartphone usage. The country’s young population and expanding middle class are also contributing to growing online sales. eMarketer expects a quarter of the population will be digital shoppers in 2018.
Despite the strong growth rate (India’s ecommerce market has more than tripled since 2015), retail ecommerce will make up just 2.9% of total retail sales in 2018. While this is low compared with more developed markets in the region, India is poised for significant ecommerce growth in the coming years as internet penetration expands.
“Ecommerce is booming in India thanks to increased internet users and cheaper smartphones,” said Eric Haggstrom, forecasting analyst at eMarketer. “In tandem with this shift to online and mobile usage, Flipkart, Amazon and Paytm Mall have been competing fiercely to claim their share of the Indian market. All three of these companies are making large investments, which include improved logistics and payment systems, as well as offering deep discounts, which will fuel future growth in the market.