E Commerce has been the biggest challenger to the organized Retail Industry in recent time or any time ever. The formidable challenge posed by E Commerce company is so much that organised retail industry in its worst nightmare can not deny the snapping of market share in long term future.
The trend is global and not specific to particular region or lifestyle. US, Europe, Canada or in Asia Pacific Region China and India are equally unilateral in accepting the Online Shopping (E Commerce). Asia Pacific Region is accounted to be 33% of global market place as in 2015 and expected to rise to 37% by 2018.
United States stands to hold numero uno position in E Commerce at present but China seems all set to outdo United States very soon. India the second most populous country is far behind in absolute value but estimated to have eight fold growth in E Commerce volume from US $ 2.5 Billion in 2012 to US $ 17.5 in 2015.
United States stands to hold numero uno position in E Commerce at present but China seems all set to outdo United States very soon. India the second most populous country is far behind in absolute value but estimated to have eight fold growth in E Commerce volume from US $ 2.5 Billion in 2012 to US $ 17.5 in 2015.
India E Commerce Scenario
E Commerce in India can be termed still at very nascent stage in India. Though, some traditional retailers have already started to attribute loss of sales to online sellers but their apprehensions seems to be misplaced. In India online shopping accounts merely 0.5% of total sales as in 2014 and expected to reach around 3% by 2020. Online travel booking comprises 70% of the total e commerce transactions in India. With these figures certainly online retail market can not destabilize the traditional and organised retail market to the extent of recognition as of now.
But the complacency ends here, India's overall E Commerce grew at CAGR of 34% to US $ 16.4 Billion in 2014 and expected to surpass US $ 22 Billion 2015. Under the E Commerce, Online Retailers and Marketplace is growing at even faster speed of 56% CAGR from 2009 to 2014. (Source PwC). Apparel & Accessories, Books and Electronics are the most popular segment under online retailing.
Low internet penetration was one major roadblock hurting the industry. Just 16% of India's population has internet penetration as against 50% in China, 57% in Australia, 69% in Japan and 70% in Korea. So internet penetration as compared to other Asia Pacific countries is quite smaller. However, this problem has been smartly handled by E commerce companies through M Commerce (mobile app)
Low internet penetration was one major roadblock hurting the industry. Just 16% of India's population has internet penetration as against 50% in China, 57% in Australia, 69% in Japan and 70% in Korea. So internet penetration as compared to other Asia Pacific countries is quite smaller. However, this problem has been smartly handled by E commerce companies through M Commerce (mobile app)
As per the google study (Nov 2014), approximately 100 Million people are expected to shop online by end of 2016 against 35 Million as in 2014 and 8 Million in 2012. Of this expected 100 Million customer base a robust 40 Millions are expected to be Women and around 50 Million new buyers are expected to come from Tier 1 and Tier 2 cities.
As the battle of mobile apps takes intensive turn various online players also get into the survival of fittest mode. As of now home grown Flipkart remains to be the biggest and the most popular in overall category aided by its prized acquisition Myntra in Apparel & Accessories category. Might of Flipkart is chased by Snapdeal and Paytm though by distance.
As the battle of mobile apps takes intensive turn various online players also get into the survival of fittest mode. As of now home grown Flipkart remains to be the biggest and the most popular in overall category aided by its prized acquisition Myntra in Apparel & Accessories category. Might of Flipkart is chased by Snapdeal and Paytm though by distance.
Amazon and Uber, the two major foreign player constantly consolidating their position in the marketplace.
The speed at which the E Commerce and M Commerce category is expanding, there definitely is threat to the organised as well as unorganised retail but as of now the traditional players are given enough arm distance to be on safer distance. The current battle leads more towards the fight of supremacy challenging one another in the game rather than challenging outside players. Another 3-5 years of online sales is going to be quite more interesting for the players as well as shoppers.
No comments:
Post a Comment