E-commerce order volume up 56% year-on-year this festive season: Unicommerce report    

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December 4, 2020 7:37 PM

The report said tier II cities and beyond contributed over 59 per cent of the online consumer demand in the country.

To exploit market responsiveness as a strategy, it will become imperative to optimize logistics and supply chain mechanisms. (File photo)

E-commerce industry saw a 56 per cent growth in order volume and 50 per cent rise in gross merchandise value (GMV) this festive season over a similar period last year, a report by Unicommerce said on Friday.

Unicommerce, e-commerce focused SaaS (software as a service) platform, analysed shopping trends for the festive month of 2019 and 2020, and the analysis is 30 days prior to Diwali with a sample size of over 44 million orders.

“This festive season, e-commerce industry reported about 56 per cent growth in order volume as compared to the festive season last year (the festive season is one month prior to Diwali in 2019 and 2020). The increasing order volume also led to the 50 per cent growth in GMV as compared to the last year festive season,” the report said.

It added that consumers have become more value-conscious than before and are now shopping across new categories.

GMV is a term used in online retailing to indicate the gross merchandise value of the products sold through the marketplace over a certain period of time.

The rise of new categories such as personal care and beauty products and higher sales of lower value products has led to a decline in average order value by 4 per cent as compared to last year’s festive season, the report said.

“One of the most promising signs for the e-commerce industry is the rising number of first-time online shoppers and the new emerging categories,” it said.

Personal care category emerged as the biggest gainer with about 176 per cent order volume growth over last year’s festive month. Beauty and wellness was another category that has reported about 52 per cent order volume growth as compared to the previous year’s festive season.

Fashion and accessories category witnessed an order volume growth of 71 per cent as compared to the previous year’s festive month, it added.

“The electronics segment continues to be the highlight of festive season sales, with all marketplaces extensively promoting discounts and offers on electronic products. The segment saw substantial growth of 65 per cent in order volume as compared to the festive month of 2019,” it said.

The report noted that returns continue to be a concern for e-tailers across India.

The automation and increasing consumer awareness is leading to a consistent decrease in returns, and the industry overall observed a 35 per cent decrease in return orders this festive season as compared to last year, it said.

The fashion and accessories category continues to the category with maximum return orders. Interestingly, brand websites have also reported huge growth in consumer demand.

“Big brands are now committed towards selling through their own websites. The brand websites witnessed about 77 per cent order volume growth as compared to 60 per cent order volume growth of the marketplace,” it said.

The GMV for brand websites increased by 48 per cent, while for marketplaces, GMV increased by 50 per cent – indicating that brands offered more discount on their own websites than marketplaces to get more customers, the report said.

“This also led to a significantly low average order size on brand websites. The average order size on the brand website decreased by 16 per cent as compared to 5 per cent dip for the marketplaces for the period of last year’s festive month,” it added.

The report said tier II cities and beyond contributed over 59 per cent of the online consumer demand in the country.

Kapil Makhija, chief executive officer of Unicommerce said festive season is the most important and opportunistic time of the year for the e-commerce industry but this year, it was particularly special as the world continues to deal with the effects of the pandemic.

“This festive month we have seen e-commerce grow beyond expectations, and it’s interesting to see the new emerging categories like personal care and beauty and wellness continuing their growth trajectory even during the festive season,” he added.

With the rising consumer demand on brand websites, brands are now committed towards going D2C and offering great deals to attract more consumers, he said.

“We are confident that with the rising number of shoppers from Tier II and Tier III cities, the e-commerce industry will continue to see the growth momentum in the coming years,” Makhija said. Unicommerce claims to process over 20 per cent of India’s e-commerce volumes and works with leading online players across segments.

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