India is among the fastest growing digital commerce market in the Asia Pacific region, representing a $7 billion opportunity, research firm Gartner today said.
This is despite digital commerce accounting for less than one per cent of the total retail sales in the country, Gartner said in a statement.
“Digital commerce is at a nascent stage in India, and it accounts for less than one per cent of total retail sales in 2015. However, India is one of the fastest-growing digital commerce markets in Asia Pacific,” Gartner Managing Vice President Gene Alvarez said.
India represents a $7 billion market, growing at more than 40 per cent every year, he added.
“Currently business to consumer (B2C) commerce leads the market in India, while B2B is limited to organisations that drive online sales while trying to cut costs in dealing with their partners and distributors,” Alvarez said.
Mobile commerce is a primary channel for digital commerce in India.
Over 40 per cent of digital commerce transactions came from a mobile device in 2014, and it is likely to exceed 50 per cent in 2015, Gartner said.
Due to the low Internet penetration in India, the country is leapfrogging the PC, and consumers are using mobile as the primary channel for online shopping, it added.
“There is a lot of hype due to the high growth and high expectation of the market, and many companies are fast expanding to grab market share and increase visibility,” Alvarez said.
However, the fierce competition is pushing up costs while the average order value remains low.
“Players need to execute on the basics to ensure the growth is sustainable… Customer experience, product range, delivery, payment and customer service are the top five things Indian digital commerce players should focus on to grow their business,” he added.