e-commerce in India: Click to Boom

Transcription

1 el e-commerce in India: Click to Boom Disclaimer: All information contained in this report has been obtained from sources believed to be accurate by Gyan Research and Analytics (Gyan). While reasonable care has been taken in its preparation, Gyan makes no representation or warranty, express or implied, as to the accuracy, timeliness or completeness of any such information. The information contained herein may be changed without notice. All information should be considered solely as statements of opinion and Gyan will not be liable for any loss incurred by users from any use of the publication or contents.

2 Table of Contents 1. Executive Summary 1. Global Overview 1.1 Top 5 Countries Ranked by B2C e-commerce Sales 1.2 e-commerce Market Worldwide 1.3 World-Wide Digital Buyer Scenario 2. Overview: e-commerce Market in India 2. 1 Market Segmentation 3. Modes of e-commerce Transactions in India 4. Online Travel 5. e-tailing 6. Financial Services 7. Classifieds 8. Trends in e-commerce Industry 9. Issues and Challenges 1. Investment in the e-commerce Sector 1.1 e-commerce Investments in 213 (Jan-May) 11. SWOT Analysis 12. Company Profile 13. Outlook 2 P a g e

3 List of Charts Chart 1: Global e-commerce Market Chart 2: Outlook- Global e-commerce Market Chart 3: Top 5 Countries Ranked by B2C e-commerce Sales Chart 4: Market Size of Indian e-commerce Industry Chart 5: Outlook - Market Size of Indian e-commerce Industry Chart 6: Online Purchasing Trend in India Chart 7: Segments of e-commerce Market in India Chart 8: Market Size of the Online Travel Industry Chart 9: Outlook - Market Size of Online Travel Industry Chart 1:Market Segment - Online Travel Chart 11: Online Travel: Profit Margins by Segments Chart 12: India s Air Passenger Traffic Chart 13: Top Travel Site - Percentage Reach as on July 212 Chart 14: Market Size of e-tailing in India Chart 15: Outlook - Market Size of e-tailing Industry Chart 16: Unique Visitor - Retail Segment Chart 17: Popular Online Websites in India - The Retail Segment Chart 18: Market Size of Online Financial Services Chart 19: Outlook - Market Size of Online Financial Services 3 P a g e

4 Chart 2: Online Classified Market in India Chart 21: Outlook - Online Classified Market in India Chart 22: Segments -Classified Market in India Chart 23: Share of Total Online Ad Spend - FY212 Chart 24: Share of Total Online Ad Spend - FY213 Chart 25: Online Advertisement Spend- Segment Wise Chart 26: Industry Wise Advertisement Spend - FY212 Chart 27: Industry Wise Advertisement Spend - FY213 Chart 28: Total Internet Subscribers in India Chart 29: Internet Usage Scenario in India Chart 3: Active Internet Enabled Smart Phones in India Chart 31: Internet Usage through Mobile Phones Chart 32: Payment Type Transaction Share, 212 Chart 33: Average Transaction Size by Payment Type Chart 34: Number of Cardholders in India Chart 35: Number of Users Transacting Online Chart 36: Private Equity Investment in India e-commerce Sector Chart 37: e-commerce Investment by Category, (21-213*) Chart 38: Number of Investments in e-commerce Segments Chart 39: e-commerce Exposure of Venture Capitalist Funds List of Tables Table 1: e-commerce Sales Worldwide by Region and Country (in USD Billion) 4 P a g e

5 Table 2: Country-wise Digital Buyer Penetration Worldwide (in Percentage) Table 3: Sources of Revenues for GDS, OTAs and Meta search Engine Websites Table 4: Component Share of Online Travel Table 5: Component Share of e-tailing 212 Table 6: Component Share of Financial Services 212 Table 7: Component Share of Online Classifieds Table 8: Contribution of Tier 2 and Tier 3 Cities in e-commerce Sales Table 9: Recent Investment, Merger and Acquisition in the Indian e-commerce Sector Table 1: Company Insight Flipkart Online Services Private Limited Table 11: Company Insight Company Insight ebay Inc. Table 12: Company Insight Snapdeal.com Table 13: Company Insight Myntra Designs Private Limited Table 14: Company Insight Company Insight Jabong.com Table 15: Company Insight Fashion & You India Private Limited Table 16: Company Insight 99 labels private limited Table 17: Company Insight Big Shoe Bazaar India Private Ltd (Yebhi.com) Table 18: Company Insight Naaptol Online Shopping Pvt Ltd Table 19: Company Insight Infibeam.com 5 P a g e

6 List of Figures Figure 1: Modes of e-commerce Transactions Figure 2: SWOT Analysis 6 P a g e

7 1. Global Overview The global e-commerce industry is growing rapidly due to growing popularity of online shopping, especially in developing countries. Greater internet penetration and a favourable demographic population have contributed to the growth of e- commerce in countries such as China and India. The global e-commerce market stood at USD billion in 212 and is expected to reach USD billion by 217, with a year-on-year growth rate of 17 percent. Chart Source: emarketer Global e-commerce Market E The North-American region contributed the lion s share to business-to-consumer (B2C) e-commerce sales, with revenues worth USD billion in 212. The Asiapacific region offers the highest growth potential and touched revenues worth USD million in 212. B2C e-commerce sales are projected to increase by 23 percent in the region, with sales in Indonesia and China estimated to increase 71 percent and 65 percent, respectively. Chart 2 3, 2,5 2, 1,5 1, 5 - Outlook - Global e-commerce Market ( ) 214F 215F 216F 217F 218F Although e-commerce has been prevalent in markets such as North Source: Gyan Research and Analytics 7 P a g e

8 Chart Top 5 Countries Ranked by B2C e-commerce Sales Top 5 Countries Ranked by B2C e-commerce Sales US China UK Japan Germany E Source: emarketer 8 P a g e

9 2. Overview: e-commerce Market in India The e-commerce market in India has registered growth rate of approximately 45 percent in 212. Although the concept has been around for more than a decade, consumers are waking up to it only recently. Rise in internet penetration, growing popularity of online transactions and favourable demographics are some of the key growth drivers of the sector. India is at the cusp of a digital revolution. Considerable broadband subscription prices, coupled with the introduction of 3G and 4G services, have led to the growth of netizens in the country. Even though the e- commerce sector is rapidly growing in India, most of its segments registered average penetration rate compared to global usage patterns. Chart Source: IAMAI, IMRB Chart Market Size of the Indian e-commerce Industry E Outlook - Market Size of Indian e-commerce Industry 214F 215F 216F 217F 218F Source: Gyan Research and Analytics 9 P a g e

10 Chart 6 Online Purchasing Trend in India Digital Footprint (Percentage of Buyers with Internet Access) Digital Influence (Percentage of Buyers who used the Internet) Digita Buyers (Percentage of Buyers who made online Purchaces) Source: BCG,CCCI, Digital Influence Study 1 P a g e

11 2. 1 Market Segmentation Transactions in e-commerce in India can be classified into four segments - business-to-business (B2B), business-tocustomer (B2C), customer-to-business (C2B) and customer-to-customer (C2C). According to the Internet and Mobile Association of India (IAMAI), B2C segment dominates the sector with a share of 56 percent. Among various sub-segments, online travel enjoys a majority market share with percent and is valued at USD billion in 212. Chart 7 Segments of e-commerce Market in India Online Travel Financial Services Other Online Services e-tailing Classifieds e-tailing accounts for percent of the overall market at USD billion in Source: IAMAI, IMARB 212. e-tailing is set for growth in the coming years not just due to greater internet penetration but also because of development of supporting infrastructure, such as logistics. Online financial transactions such as payment of insurance premium, utility and mobile bill payments and share trading accounts form a market share of 6 percent. B2B and B2C classifieds (jobs, matrimony, real estate, car hire) contribute 5 percent while other online services such as online entertainment ticketing, food delivery and transactions of gift vouchers account for 2 percent of the overall market. 11 P a g e

12 4. Online Travel The online travel segment accounts for the lion s share of the e-commerce industry in India. The country s travel-andtourism sector has the second highest growth in the world and has contributed to the rise of this segment online. With an average year-on-year growth of percent, the segment is valued at USD billion in 212. It is expected to clock a turnover of USD billion in 213 with a CAGR of percent through Currently out of the total online travel market, the domestic air ticket segment contributes 5 percent of the market share with annual turnover of USD billion in 212. The online transaction relating to railway ticket contributes 39 percent of the overall market and is valued at USD billion. The civil aviation sector registered favourable growth in the last decade and is poised to be one of the leading civil aviation markets in the world over the next decade. The website of India railways is the most visited travel site in India with more than 12 million visitors monthly. According to a study report by ASSOCHAM, 1 out of 5 online users in Chart Market Size of Online Travel Industry (29-213) E Source: IAMAI, IMARB Chart Outlook - Market Size of Online Travel Industry ( ) 214F 215F 216F 217F 218F Source: Gyan Research and Analytics 12 P a g e

13 India visit the Indian Railways site. 5. e-tailing e-tailing comprises components such as apparel, footwear, jewellery, mobile phone, books, computers and laptops, home kitchen appliances, gift vouchers and flower and toys. The e-tailing segment in India stands at USD billion in 212 and is anticipated to reach USD billion in 218 at a CAGR of percent through The online retail segment in India clocks the highest growth rate with virtual window shopping becoming popular. Chart Market Size of e-tailing in India (29-213) E The Indian retail industry is valued at Source: IAMAI, IMARB USD billion in 212, with approximately percent of it belonging to the unorganised sector. The online segment consists of 1 percent of the overall organised retail industry in India and is anticipated to grow further. Currently, laptops/netbooks/tablets contribute percent of the overall industry and is valued at USD million in 212. The apparel and footwear segment accounts for percent of the market share while mobile phones, cameras, mobile and camera accessories Chart Outlook - Market Size of e-tailing Industry ( ) F 215F 216F 217F 218F Source: Gyan Research and Analytics 13 P a g e

14 account for 33 percent. Consumer durables, home furnishing, books and kitchen appliances contribute 2 percent of the overall market. The segment comprising deals/coupons, toys, gifts, handicrafts and flowers, however, contributes a nominal 3 percent of the pie. It is projected to grow rapidly in the years to come. 8. Trends in e-commerce Industry i. Increasing Online Users: A steady rise in the internet user base has contributed largely to the growth of e-commerce sector in India. According to the Internet and Mobile Association of India (IAMAI), internet user base has grown significantly to reach million as compared to million in 211. According to the Telecom Regulatory Authority of India (TRAI), the total internet subscriber base in India stood at million as of June 213. Chart Source: IAMAI, TRAI Total Internet Subscribers in India (29-213) (June 213) 14 P a g e

15 ii. Rise of On-the-Go Shopping: There has been a rapid growth in smartphone use in the country, stimulating the growth of e-commerce market. With the introduction of 3G and 4G internet services, the concept of on-the-go shopping has become popular. Active number of internetenabled smartphone users in India reached million in 212 and is anticipated to have million users by 216. Chart Active Internet-Enabled Smartphones in India E 214F 215F 216F Source: KPMG 15 P a g e

16 13. Outlook E-commerce in India has grown rapidly last five years and is poised to register higher growth rate in the near future. The psyche of Indian consumers has changed over the years and there has been a shift in favour of online shopping. Thus, e-commerce has widened its acceptance among Indian consumers as a hassle-free and safe shopping method. There are more than 2 million credit and debit holders and only 1 million internet users transact online, offering huge untapped market space for companies in e-commerce sector. 16 P a g e

17 GYAN RESEARCH AND ANALYTICS PVT. LTD. Corporate Office: LG 37-38, Ansal Fortune Arcade, Sector-18, Noida Delhi NCR, INDIA Phone: Regd. Office: 298-A, Pocket 2 Mayur Vihar Phase -1 Delhi 11 91, INDIA Central Delivery Centre: BD-9, Sector-1, Salt Lake City Kolkata- 7 64, INDIA Phone: reports@gyananalytics.com Website: 17 P a g e