e-Commerce Market in India 2013

The new report, "e-Commerce Market in India" states that a steady rise in the disposable income and proliferation of internet across the country happen to be the primary market drivers for e-Commerce businesses in India. It is anticipated that the tier II & III cities will contribute the most in shaping up the demand curve in the ensuing years. A thorough research on the market shows brimming opportunities for vendors from the mobile internet and social media space.
The Indian e-Commerce market primarily comprises of five major segments i.e. online travel, retail, financial services, digital downloads and ‘other services', wherein the online travel and retail segments dominate the overall pie with a cumulative share of more than 85%. Of all, online retail happens to be the fastest growing segment in the Indian market. Competition in the market is severe and low consumer loyalty prevailing in the market furthers the competition by manifolds. Revamped business strategies, consolidations and innovation in products/service delivery model have become the most eminent trends in the market.
An Analysis of the basic causes which actually boost the market in favor of the players, has highlighted the major market boosters in the likes of increased disposable income, increasing internet penetration & PC user base and ease of transaction. On the other hand, issues hindering the profitability of players include the high cost of online advertising, losses incurred in providing Cash-on-Delivery (COD) services to end consumers and operational cost stack-ups. These practical challenges have taken a heavy toll on the vendors operating in the market, especially in the online retail segment. However, nullifying these challenges is not an easy way for the players and hence business models are constantly being tweaked and revamped in order to squeeze in maximum profitability.
Indian e-Commerce market is currently brimming with opportunities and vendors are poised to reap substantial benefits from the same. The exponential growth in the usage of mobile internet can be effectively utilized by vendors to gain a deeper market reach. Further, mobile internet can also be beneficial for an effective and efficient marketing medium which paves way for a better customer acquisition and retention process. Additionally, the massive user base of social networking websites have become the biggest database for vendors to scout for prospective customers. Advanced analytical tools and applications have made the job easier for vendors in India.
Competition in the market is seen to be highly stiff and factors such as low brand loyalty, price sensitivity and affinity towards discounted offers & services amongst consumers makes the competition even severe. Advanced analytical tools and applications are being constantly sought after by players in order to create a better scope in the market.