Women And Mobile Shoppers In Tier 2 & 3 Cities Are Driving India’s Online Retail Market
On November 20, Google released a report on the findings from a survey it conducted in collaboration with Forrester on online shopping trends in India. The report highlights what’s driving the growth of eCommerce in India, including mobile commerce, female shoppers, and the growing number of people in tier two and tier three cities making purchases online. However, the report also noted some barriers to online retail in India, such as its poor showing regarding customer satisfaction and trust; to make further progress, eCommerce firms must work hard to improve in these areas. The report’s key findings involved:
- Mobile shoppers. Mobile is driving the market, especially in tier two and tier three cities in India. Half of the online shoppers in tier three cities are already on mobile, compared with just one-third in tier one cities. The percentage of online buyers making shopping queries from a mobile device has grown from 24% in 2012 to 57% in 2014. Forrester forecasts that mCommerce in India will reach $19 billion by 2019.
- Women. Women are far more active buyers than men in tier one cities. They outspend men online by two to one, and one-quarter of women in tier one cities make mobile purchases.
- New buyers. More than 70% of people in tier one and tier two cities who do not currently make purchases online are expected to do so in the next 12 months.
- New growth areas. Home furnishings, cosmetics, and baby care are the next areas of growth for online retail after the success of online retail in the consumer electronics segment.
- Low customer satisfaction. More than 60% of buyers reported that they were not satisfied with their online shopping experience. Two-thirds of the buyers surveyed also highlighted the complications of current return processes — a weakness that really came to light during the Big Billion Day sale on October 6.
- Lack of trust. 55% of buyers do not trust the quality of the products offered online.
For this research, Forrester Consulting surveyed 6,589 people in 50 cities across India. The respondent pool included both those who buy online and those who do not.
Forrester Research Online Retail Forecast, 2014 To 2019 (Asia Pacific)