With 100 million Indians expected to shop online by 2016, e-commerce sector in the country will grow to be a $15 billion market in two years, according to a report by Google and Forrester Consulting.
“The consumer confidence to shop online has grown significantly in the last year and a half. About 8 million people were shopping online in 2012 and the number this year is expected to be 35 million. By 2016, online shopper base will grow almost three times to 100 million, and over 50 million new buyers will come from tier I and II cities,” Google India Managing Director Rajan Anandan said.
India's etailing market is at an inflection point and will see rapid growth to become a $15 billion market by 2016, he added.
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According to the research conducted across 6,859 respondents, the confidence to shop online is on the rise as 71 per cent non-buyers (respondents) from tier I and II cities said they plan to shop online in the next 12 months.
Additionally, of the 100 million online shoppers, about 40 million are expected to be women. Already, women buyers in tier I cities are driving growth, outspending men by 2X.
“Women buyers are set to become the most significant contributor to the growth of online shopping and there is a huge opportunity waiting to be unlocked in this user segment,” Google India Industry Director for Ecommerce (Local and Classifieds) Nitin Bawankule said.
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Amongst the challenges, the report pointed out, 62 per cent buyers said they were not satisfied with their online shopping experience, while 67 per cent highlighted the current return process was too complicated and expensive.
Among non-buyers, trust was a major issue with 55 per cent saying they did not trust the quality of products sold online, were concerned about safety of online transactions (63 per cent) and did not feel comfortable sharing personally identifiable information online (65 per cent).
About 66 per cent of total respondents said poor connectivity was also a major barrier for them to shop online.