Is E-Commerce in India growing at the pace that it should?
As per the latestÂ findings, Indian Ecommerce growth is pegged at 30% year on year. Do you think these figures should make online retailers happy?
AsÂ per the report released by Internet and Mobile Association of India (IAMAI) and IMRB International, the total onlineÂ transactions in India stood at Rs. 7080 crores (approx $1.75 billion) for 2006/2007 and is expected to grow by 30% to touch 9210 croresÂ (approx $2.15 billion) by 2007/2008.
Just to put it in perspective, that isÂ only 0.002% of our GDP!
Distribution of Online spending
The Online spending is categorized mainly in following 5 areas:
Travel: comprising Travel aggregators, Tour Operators, Hotels and Railways
E-tailing: comprising Online Retailers and Online Auctions.
Classifieds: comprising Online Jobs, Online Matrimony, Online Property, Online Automobile and General Classifieds
Paid Content Subscription: comprising research, articles, exclusive videos, etc
Digital downloads: from Internet to Mobiles and internet
Here is the chart of rest of the online spending breakup:
|Â Description||Â 2006/2007Â
|Â 1||Â Travel Industry||5500||7000||Â 76%|
|Â 2||Â E-tailing||850||1105||Â 12%|
|Â 3||Â Online Classifieds||540||820||Â 9%|
|Â 4||Â Paid Content subscription||20||30||Â –|
|Â 5||Â Digital Downloads||170||255Â||Â 3%|
|Â||Â Total||Â 7080||9210Â||Â 100%|
It is quite clear that online spendingÂ is largely skewed towardsÂ Travel E-Commerce. Rs. 7000 crores out of 9210 crores is expected to be spent on online purchase related Travel like AirFare and train / Bus ticket booking. So 76% of overall E-Commerce goes to travel sector alone.
30% growth seems to low considering that Internet and mobileÂ growth is happening at much higherÂ pace and Online Ecommerce is directlyÂ proportional to that growth.
What do you think? Have you shopped online yet?