India has a large population of over 1.25 billion people and a young demographic. While ecommerce currently accounts for less than 1% of retail sales, it is growing rapidly due to rising internet and smartphone penetration. Key challenges to further growth include a lack of infrastructure for logistics and delivery, as well as issues with payments in rural areas where credit cards are not widely used. However, ecommerce companies are investing heavily and targeting the emerging middle class and rural consumers to drive future expansion of the market.

1. Country profile: India
eCommerce on the rise

2. AU$
17.5
billion
eCommerce
market
22.7
million
population
Despite its large population, India's
eCommerce market is only just bigger than
Australia's online market.
AU$
24.2
billion
eCommerce
market
1.25
billion
population
[1]
[2]
[3]

3. With 68% of its citizens below the age of 35
years old, India has the largest youth
population in the world.[4]

4. With eCommerce accounting for less than 1% of retail
sales in India, the prospects for growth over the coming
years are very promising. By some predictions, the
market could reach $100 billion by 2019.[5]
2015
2019

5. At just over 27%[6]
, India's
internet penetration is
relatively low, but hundreds
of millions of Indians are
set to go online in the
coming years.
20
2004
2013
2015
2019
243
350
640(predicted)
Internet users in india
(millions)
[7]
[7]
[8]
[9]

6. Let's look more closely at
the Indian consumer

7. As of August 2015, India has 590
million unique mobile users, or
46% of the population. Of those
users, there are 159 million
active mobile internet users, or
12% of the population.[10]
Predicted mobile
internet users in india
(millions)
173
2014
2015
2016
2017
2018
2019
232
286
342
399
457
Did you know?
India is the world's
third largest
smartphone market
after the US and
China, with almost
50% of models
costing under $100.[12]
[11]
Going mobile

8. In India, less than 5% of digital sales happens on mobile,
but 30% of traffic for eCommerce sites come from mobile
and tablets. [12]
Did you know?
11% of Indians have
made a purchase
via mobile in the
past month.[13]
Shopping via mobile

9. Rise of the ‘rurban’ Indian
Being 'rural in demography'
but 'urban in lifestyle' marks
the arrival of the 'rurban'
class of Indian consumers.[15]
While roughly 1 in 7 people
in India live in areas without
any mobile reception,[15]
there has been a 600%
growth in rural internet
subscriptions in the past
3 years.[14]
Active internet users [15]
(millions)
61
(7% penetration)
289
(76% penetration)
rural urban

10. India's eCommerce
market has four
main players.
They are flush with
billions in investment
and poised for
growth.[16, 17]
Marketplaces
Flipkart
snapdeal
amazon.in ebay.in

11. A recent study found
eCommerce companies
received the most
complaints in India
in 2014.
Problems include:
• delay in delivery
• delivery of wrong product
• issues with refunds and
replacement
• lack of product availability
• trouble with deals and
discounts[18]
Customer service issues

12. Missing and stolen parcels are a
persistent problem.[19]
India's size and diversity has
resulted in a lack of logistics
infrastructure, with the last mile
being particularly difficult.
This has undermined efforts of
web-based merchants to build
customer loyalty.[20]
Logistical roadblocks

13. Many people in India lack
credit cards, internet
banking services, or a
secure connection, making
eCommerce payments
difficult.
This is especially
pronounced in rural areas.[21]
Payment problems
Checkout
Pay with Credit
Pay with
bank transfer

14. Informal and traditional
retail will continue to
dominate, but eCommerce
is on the rise.
Growth is coming from an
emerging middle class, the
younger generation and
rural consumers. [22]
Supply chain issues are
hindering consumer
confidence.
To sum up

15. The good news? StarTrack is currently
exploring ways to help our customers enter
Indian eCommerce marketplaces and
achieve best-possible supply chain and
delivery outcomes.

16. Expanding overseas?
Call StarTrack today on 13 2345
A business of Australia Post

17. 12
13
14
15
16
17
18
19
20
21
22
http://www.gartner.com/newsroom/id/2876517
We Are Social, August 2015
http://www.slideshare.net/wearesocialsg/digital-social-mo-
bile-in-india-in-2015/3-We_Are_Social_wearesocialsg_weareso
cialsgACTIVEINTERNET
WARC 2015, Rise of the rurban Indian
We Are Social, August 2015
http://www.slideshare.net/wearesocialsg/digital-social-mo-
bile-in-india-in-2015/3-We_Are_Social_wearesocialsg_weareso
cialsgACTIVEINTERNET
Times of India, 2015
http://timesofindia.indiatimes.com/tech/tech-news/Flip-
kart-vs-Snapdeal-The-gloves-are-off/articleshow/
48837848.cms
http://www.cnbc.com/2015/07/30/snapdeal-indias-e-com-
merce-can-grow-faster-than-china.html
The Economic Times (2015)
http://articles.economictimes.indiatimes.com/2015-02-15/news/
59166794_1_e-commerce-players-akosha-complaints
Bloomberg, 2014
http://www.bloomberg.com/bw/articles/2014-12-11/logis-
tics-hold-indias-e-commerce-companies-back
Financial Times, 2014
http://www.ft.com/cms/s/0/67706956-640f-11e4-8ade-00144fe-
abdc0.html
WARC 2015, Rise of the rurban Indian
WARC, 2013.
CIA World Fact Book, July 2015
Statista, 2015
http://www.statista.com/topics/2454/e-commerce-in-india/
NAB Online Retail Sales Index
http://business.nab.com.au/tag/online-retail-sales-index/
WARC, 2013
Times of India
http://timesofindia.indiatimes.com/tech/tech-news/Indi-
an-ecommerce-industry-to-post-35-growth-Study/articleshow/488
43725.cms
PwC, eCommerce in India: accelerating growth, 2015
http://www.pwc.in/assets/pdfs/publications/2015/ecom-
merce-in-india-accelerating-growth.pdf
Economic Times, 2015
http://articles.economictimes.indiatimes.com/2015-09-03/news/
66178659_1_user-base-iamai-internet-and-mobile-association
Next Big What, 2015
http://www.nextbigwhat.com/internet-industry-data-india-297/
We Are Social, August 2015
http://www.slideshare.net/wearesocialsg/digital-social-mo-
bile-in-india-in-2015/3-We_Are_Social_wearesocialsg_wearesocial
sgACTIVEINTERNET
KPMG India
IDC 2015
http://www.idc.com/getdoc.jsp?containerId=prSG25827215
References
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