India fastest growing e-commerce market globally
According to a report by Assocham and Forrester, India's e-commerce sector is the fastest growing in the world. While India may have a smaller base in terms of business, its growth rate of 51% is much higher than China's 18%, Japan's 11% and South Korea's 10%. India's e-commerce sector will expand to $120 billion by 2020 from $30 billion in Financial Year 2015-16.
The Associated Chambers of Commerce and Industry of India (ASSOCHAM) is one of the apex trade associations in India that was established in 1920. It represents interests of trade and commerce and acts as an interface between industry, trade and other stakeholders. Forrester is an American firm that does market research and provides advice on the impact of technology to help drive growth.
India's e-commerce growth rate is almost thrice that of China's. According to the report, the major reasons for a stunning growth of the e-commerce sector in India are a young demographic profile, rapidly increasing internet penetration and a relatively fast growing economy. Further, increasing mobile penetration, growing acceptance of online payments, etc. has helped e-commerce companies to sell products to users.
India is among the youngest nations in the world having 65% of its population below the age of 35 years or almost 2 in 3 in India are younger than 35 years.
India has the second largest base of internet users. India's 400 million internet users are almost twice that of Brazil's (210 million) and more than thrice that of Russia (130 million). Around 3/4th (75%) of the internet users in India are between 15-34 years of age. The report adds that the maximum number of online shoppers are in the age group 15-24 years.
The online travel segment which includes airlines, railways, car rentals, hotels, etc. has seen substantial growth. IRCTC of the Indian Railways remains the largest e-commerce portal with 1 in 5 online users visiting the IRCTC website. The e-retail penetration has increased by 55% over the last year to reach 65 million unique users a month. The growth is seen in all retail categories.
In India, almost 2/3rd of the total e-commerce sales happen over mobile platforms such as smartphones, tablets, etc. The industry feels that the sales over mobile platforms can generate up to 70% of e-commerce's revenues.