M COMMERCE

E COMMERCE GROWTH IN THE LAST 5 YEARS

2008-09 ONWARDS
Present Scenario:Indias E-Commerce market grew at a staggering 88% in 2013 to $16 billion, riding
on booming online retail trends and defying slower economic growth and spiraling inflation, according
to a survey by industry body ASSCHOM.
Indias E-Commerce market was about $2.5 billion in 2009, it went up to $6.3 billion in 2011 and to
$16 billion in 2013 and is expected to growhuge $56 billion by 2023 that would be 6.5% of the total
retail market.

Year

Internet Users (millions)

2006

32.2

2007

46.0

2008

51.8

2009

61.3

2010

100.0

(Source:Google Public Data)

The trend is expected to continue as the e-commerce market in India is estimated to be worth
$16 billion in 2013 and is expected to touch $56 billion by 2023, according to the latest
ASSOCHAM report. Consumer behavior and shopping-trends have helped the Indian ecommerce industry to record a staggering 85% growth in 2013. The e-commerce market in India
will control 6.5% of total retail market by 2023.

The number of Internet users in India has reached 205 million in October this year, registering a Y-o-Y growth of 40%
over last year. By December 2013, it is expected to reach 213 million. This was the major findings of the I-Cube 2013
report, released by the Internet and Mobile Association of India (IAMAI) and IMRB International, today.
The report also estimates that by June 2014, India will have 243 million internet users, at which point of time, it is
expected to overtake the US as the second largest Internet base in the world. China currently leads with more than 300
million internet users while the US currently has estimated 207 million internet users.

Mary Meeker, a partner at Kleiner Perkins Caufield & Byers (KPCB) and former Internet analyst,

has released her latest report on Internet Trends called 2012 KPCB Internet Trends Year-End

Update. She noted that this report provides an update to the Internet trends report released in
June 2012.
India has added 88 million Internet users during 2008-2012 and now has 137 million Internet
users, recording a 26% growth year-on-year (YoY). The population penetration rate for India
stood at 11%.
- India has 44 million smartphone subscribers as of Q4 2012, recording a 52% growth YoY.
with a report by Internet & Mobile Association Of India (IAMAI) and IMRB International
predicting that there will be 155 million people accessing the web through their phones by the
end of March 2014.
With a quarter-over-quarter growth of 20 per cent, this number is expected to cross 185 million
by June 2014, says the Mobile Internet In India 2013 report released Wednesday. According to
the report, in October 2013, India had 110 million mobile internet users

According to the survey, India's e-commerce market, which stood at $2.5 billion in 2009, reached
$8.5 billion in 2012 and rose 88 per cent to touch $16 billion in 2013. The survey estimates the
country's e-commerce market to reach USD 56 billion by 2023, driven by rising online retail.
India has Internet base of around 150 million as of August, 2013, the survey said.
"Having close to 10 per cent of Internet penetration in India throws a very big opportunity for
online retailers to grow and expand as future of Internet seems very bright,"

The number of Internet users in India has reached 205 million in October this year and by June
2014, India will have 243 million internet users,
According to the report, the number of internet users in urban India was 137 Million in October
and is estimated to touch 141 Million by December 2013.
The ecommerce industry of India is one of the fastest growing segment in the Asia Pacific region.
With a staggering CAGR of 34.58% from 2009 to 2012, the Industry has expanded from INR
19249 Crore (USD 3.49 bn) to INR 47,349 Crore (USD 8.60 bn) in a matter of 3 years.

SMARTPHONES
According to IDC, 40 million no. of smartphones in India at present that is expected to surge to 155
million in 2017

smartphone sales in India has grown over three-fold to touch 12.8 million units in third
quarter of 2013, cannibalising the feature phone market, research firm IDC says.
According to IDC, the India smartphone market grew by 229 percent year-on-year to 12.8
million smartphones in third quarter of 2013 compared to 3.8 million units in Q3 of 2012.
Smartphone sales grew 28 percent in Q3 of 2013 compared to April-June 2013 (10.02
million), it added.
IDC said 53.9 million feature phones numbers were sold in Q3 of 2013 compared to 55.7
million in Q3 of 2012.
The share of feature phones slipped to 81 percent (from 84 percent) of the total market in Q3
2013, it added.

In Q2, 2012 India witnessed 3.9 million shipments, this figure grew to 9 million in Q2, 2013.
With this growth India has now become the 3rd largest Smartphone market in the world.

Overall Smartphone sales grew 50 percent with shipments growing from 158.3 million in Q2
of 2012 to 238.1 million in Q2 of 2013.

As per the Neilsen report, penetration of smartphones in India stands at 9 per cent of
929 million users growing at 50 per cent year-on-year compared with 55.5 per cent in the
US. And over 75 per cent of these smartphone users access Internet on their device at
least twice a day.

YEBHI.COM
As Chief Marketing and Business Officer of Yebhi.com, Nikhil Rungta has been at the helm of
marketing and PR for the e-commerce portal. He has additional responsibilities of managing the
business P&L, corporate strategy and product management (UI and UX).
Currently, India has a mobile customer base of 951 million, of which 87 million Indians are
accessing the internet through their mobile phones. Yebhi.com receives close to 15-20 per cent
traffic from mobile phones. This further indicates how consumers are using different platforms to
shop online.
SNAPDEAL
For the first time in the history of Indian eCommerce, a major player has come out and openly
admittedthat they are fully experiencing the next wave of mobile ecommerce. In a statement released
by Snapdeal, it has been revealed that out of 10 orders, 3 are coming in from a mobile phone.
30% of all Snapdeal orders are originating from mobile commerce, and thats a huge chunk.

These insights from Snapdeal were revealed after a 6 month survey and research based on the traffic
received by their main website and mobile commerce site.
Snapdeal shared that it received around 35 to 40 million visits every month, out of which 12 million
reaches its mobile commerce site.

"Intent to purchase is now driven via mobile"

The contribution of e-commerce site traffic to the online shopping category via mobile has
increased from 8 per cent to 20 per cent and on tablet from 2 per cent to 6 per cent in 2013.
About 61 per cent of smartphone users in the country, according to a syndicated research, have

spent money via their mobile phones on purchase. The top purchase categories are digital goods
at 37 per cent and movie tickets at 24 per cent. This is followed by clothes, travel and financial
services at roughly 16-22 per cent. The overall mobile ecosystem in India has created favourable
conditions for m-commerce to explode. The few reasons for this trend include the fact that
devices are becoming cheaper - cellphones are far cheaper than desktops and laptops. The
second is mobile internet connectivity. According to Trai, there are over 431 million internet
capable mobile devices in India, making access easy for consumers across the length and
breadth of India.
Third is access; the on-the-go nature of the mobile phone makes purchases of low hanging
categories like movie tickets, fast food, digital goods more convenient than ever. Fourth is
personalisation. It is a big advantage for marketers as the nature of the device can help deliver
personalised communication, therefore, aiding better receptivity when it comes to transactions.
The larger question is whether to develop a mobile site or an app to aid transactions? However,
this issue is redundant in a country like India. I don't think it's a choice anymore. It also doesn't
depend on the retailers/merchant; it is basically about how consumers are browsing the content
via feature phone or a smartphone. Hence, one needs to have both access modes - a mobileoptimised website as well as a mobile app.
Also one must take into account the ROPO (research online, purchase offline) effect that didn't
get e-commerce to explode in the early days. It has now become the ROMPO effect of research
on mobile and purchase online. While transactions may not be at an explosive pace on mobile,
ROMPO has ensured that intent to purchase is now driven via mobile. Cash on delivery is a great
innovation therefore for m-commerce as it surely fuels purchase via mobile.
The largest apprehension is that consumers refrain from transacting high value items on mobile.
But this is changing gradually.
Vinod Thadani, CEO, Madhouse India

AVENDUS REPORT

Apparel & lifestyle e-tailers, Myntra and Yepme claim that 12% and 10% of their transactions
respectively are coming from mobile while leading marketplace, Snapdeal continues to demonstrate
the traction marketplaces have enjoyed with m-tailing and claim that 15-20% of their transactions
are done through mobile devices.

COMSCORE-ASSOCHAM REPORT, SEP 2012

Retail : A closer look

Retail category penetration has increased to 60% reach and has grown to 37.5 million unique visitors
a month, an overall growth of 43% annually. The growth has come across all retail categories and
most of them show promising transactions and conversion rates along with growth in visitors. The
top retail sites shown above in India have each seen a growth of over 100% in the last 12 months.

Amazon is the most visited retail site with most of the traffic slipt among Amazon.com, ImDB and
Junglee.com.

Flipkart leads the way among the online retailers in India with 7.4 million unique visitors a month,
growing at 431% annually. Snapdeal has been close second with 6.9 million uniques. Jabong and
Myntra have been competing closely in the lifestlye category with over 5.3 million uniques each.
HomeShop18 has over 4 million uniques a month.
Apparel has been the fastest g r owing subcategory in retail and reaches 13.4% online users in India.
Comparison shopping, as research of retail online grows continue to dominate. Most of the
comparison shopping sites show a growth over 75% Y-o-Y and will continue to grow as more
categories of retail come online. Travel category has shown this trend with high overlap among OTAs
and this trend is expected among online retailers as well.
Consumer goods, sports/outdoor products and retail food sub categories have also shown early
growth signs. Consumer goods being a popular category among horizontal retailers is still way below
global averages.
Flowers/gifts/greetings is the only subcategory which has shown de-growth of over 33% in the last
12 months.
State of Ecommerce in India - Sept 2012 9
Average transaction size
Vertical e-Commerce categories including baby products, apparel, shoes and other lifestyle
categories have also shown tremendous growth. Wider assortment and product availability have
helped these retailers in growing business online.

IS Advisors
ECOMMERCE INDUSTRY IN INDIA (20112015) , JAN 2012

APPAREL E-COMMERCE

Worth $16 Billion In 2013 And Is

Headed Towards The $56 Billion
Mark By 2023
The e-commerce market in India has been growing by leaps and bounds for the last few years.
The trend is expected to continue as the e-commerce market in India is estimated to be worth
$16 billion in 2013 and is expected to touch $56 billion by 2023, according to the latest
ASSOCHAM report. Consumer behavior and shopping-trends have helped the Indian ecommerce industry to record a staggering 85% growth in 2013. The e-commerce market in India
will control 6.5% of total retail market by 2023.

The Indian e-commerce market grew at 88% and amounted to $ 16 billion in 2013according to a recent
Assocham report.
The increasing Internet penetration and availability of more payment options boosted the e-commerce
industry in 2013. Besides electronics gadgets, apparel and jewellery, home and kitchen appliances, lifestyle
accessories like watches, books, beauty products and perfumes, baby products witnessed significant
upward movement in last one year, Assocham Secretary General, D S Rawat told Economic Times.
Assocham estimates that Indias e-commerce market will reach $56 billion by 2023, driven by rising
online retail. It stood at $2.5 billion in 2009, amounted to $8.5 billion in 2012 and rose 88% to touch $16
billion in 2013.

Nearly 10% of the total population in India is on the internet now and with a growing penetration
India is expected to leapfrog U.S. to become the second largest country by the number of
internet users. According to a report from ComScore, three out of every five internet users in
India are shopping online. This has made India, one of the most lucrative markets for global ecommerce giants, especially the likes of Amazon and Alibaba. While Amazon has already
ventured into the Indian market, Alibaba is keen to make a perfect start.

Ecommerce market is reaching new heights as online shopping has grown many
folds in the last four-five years, especially in the year 2012. Google has released its
report on ecommerce trends and the share of potential categories driving the
ecommerce market. As per the report, online shopping has grown by a whooping
128 percent in the year 2011-12 as compared to 40 per cent in the year 2010-11.
Another important finding of the report suggests that while it was electronics and
books that had lead the shopping categories, the year 2012 saw a potential growth
in apparel and accessories with it comprising of 30 percent of the queries filed on
Google search, and this trend is expected to see major growth in the year 2013 as
well.
As suggested by the report, books and electronics lead the e-commerce growth
initially, but 2012 saw a huge growth in the demand for apparels and accessories
via online portals. It is expected that the apparel and accessories market will
overtake consumer electronics, which shared 34 percent of the overall Google
search records in 2012 and make a larger space than consumer electronics.

RETAIL ECOMMERCE

Apparel e-com fastest growing category; One in

10 Indians logged online in July: comScore
September 14, 2012 | Sonam Gulati

Retail e-commerce
In the retail e-commerce space, worlds largest player Amazon remains at the top although
the traffic is split between the parent online retailer Amazon.com, movie information
site ImDb and India-focused e-commerce search enabler Junglee.com. Although Indian

consumers can buy directly from Amazon.com, they need to pay in US dollar and have to pay
shipping charges as well besides import tax as Amazon is not yet allowed to operate an Indian ecommerce site. However, Amazon may only strengthen its lead, having recently launched an ebook site for the Indian consumers (as also its own e-book reader).
Among the local players, Flipkart leads the way with 7.4 million unique visitors a month
(growing more than fivefold over the past one year), closely followed by Snapdeal, which had
6.9 million unique visitors. Jabong, Myntra and HomeShop18 square up the top five local ecommerce sites.
Flipkart also leads in terms of average transaction size with $35 whereas Myntras and
Yebhis average transaction figures were $24 and $27, respectively.
The study has brought out how apparel, as a category, is clearly on a tear as the fastest-growing
retail sub-category. Although it is smaller in reach, compared to the comparison shopping sites
(see graph), it grew 362 per cent in the past one year.

The only category to have shown de-growth in India over the last 12 months is
flowers/gifts/greetings (decline of around 33 per cent).
Overall penetration of retail e-commerce category has increased to 60 per cent, growing to 37.5
million unique visitors in July and recording an overall growth of 43 per cent YoY, as per
comScore. In comparison, globally, retail e-commerce has penetration of close to 72 per cent
and has grown over 13 per cent YoY in July.

December 20, 2012

Marketsize
The eCommerce industry in India has seen a multifold increase in the past three years, with the total
market size increasing from Rs 19,688 crore by the end of 2009 to an estimated Rs 28,500 Crore ($6.3
billion) in 2011 and Rs. 76,300 crore ($14 billion) in 2012.

Online travel constitutes a sizeable portion (87%) of this market today. Globally, online travel constitutes
a much smaller portion of the overall e-commerce pie in the US, online travel contributes 37% of total ecommerce revenues.

Asian markets, especially China and Japan have been even lower (less than 20% in both these countries) in
terms of online travels contribution to e-commerce. [Source IAMAI and Avendus] Below is the
infographic highlighting growth/projection of total online consumer revenue.

E-tailing market has become already larger than most projections, the segment reportedly grew around
80% in 2011 and 139% in 2012. Based on Technopak report, the e-tailing market will grow to Rs 73,575
Crore ($13.5 billion) in 2017.

The number of Indian online shoppers is currently estimated at 14% of the total Internet users; and is
expected to increase at a rate of 35% over the next 4 years. At these growth rates, the number of online
shoppers is likely to reach 38 million by 2015. This growth is expected to drive the overall growth of the ecommerce space in India, with revenue per online shopper also increasing at a similar pace.

The Indian ecommerce market to also evolve towards higher contribution from e-tailing in coming years.
E-tailing will catch up with online travel by 2015, with each of them contributing approximately $12
billion to the total ecommerce market in that year.
(source Avendus)