India may be ahead of countries like Brazil and Russia with a higher Internet population but lags behind when it comes to online shoppers and transaction sizes, a report by EY said today.
According to the report titled ‘India vs BRICs: a comparison of the e-commerce ecosystem’, the Indian Internet user base is just second to China but only 14 per cent of Internet users shop online in India compared to 30-35 per cent in Brazil and Russia, and 55 per cent in China.
Also, the ticket size of online transactions in India is nearly 70 per cent, lower than any of the other three BRIC countries, it added.
The report said India had an Internet user base of 243 million in 2014, of which 35 million were online shoppers.
Compared to that, China had 361 million online shoppers (649 million Internet users), Brazil 33 million (108 million Internet users) and Russia 30 million (84 million Internet users) in 2014.
Also, India’s retail e-commerce market stood at USD 5.2 billion in 2014, USD 426.3 billion in China, USD 16.3 billion in Brazil and USD 17.5 billion in Russia, respectively.
Indian Internet users are still using the service for several activities other than shopping like social networking, video streaming and emails/browsing, the report said.
“Further, the Indian online shopper is purchasing low-value items, implying that e-commerce portals are being used primarily for research and not to purchase high ticket items. The consumer is still more comfortable buying higher value items from stores,” it said.
The report added that consumers in Brazil have a higher propensity to buy consumer electronics, home appliances, furniture and jewellery online.
“The Indian e-commerce market has witnessed fierce competition between players of all sizes. Traffic across e-commerce portals is on the rise.
However, this does not always translate to purchases. In a sunrise industry that is set to reach greater heights, the effective usage of data analytics will be the critical differentiator,” it said.