News / Asia

    India Witnesses Online Shopping Boom

    Workers are seen at their workstations on the floor of an outsourcing centre in Bangalore, February 29, 2012.Workers are seen at their workstations on the floor of an outsourcing centre in Bangalore, February 29, 2012.
    x
    Workers are seen at their workstations on the floor of an outsourcing centre in Bangalore, February 29, 2012.
    Workers are seen at their workstations on the floor of an outsourcing centre in Bangalore, February 29, 2012.
    Anjana Pasricha
    India is witnessing an online shopping boom as more and more people get comfortable spending money with the click of a button. The total e-commerce market has increased some 400 percent in the last five years. India's retail industry is responding to the demand from the country’s tech-savvy, increasingly wealthy young population.

    Whether it is cosmetic jewelry, handbags or watches, 30-year-old Shweta Andrews no longer waits to visit stores or shopping malls to clinch a deal. She says her busy work schedule makes it easier to surf e-commerce retail shopping sites that have sprung up in recent years.  

    “I really love it," she said. "Anytime, just take out 15 minutes, if you have something in your mind that you want to buy, just go to that particular website, buy it, so that’s, you know, great. It’s better than going out because I can do it everyday.”  

    E-commerce is still a small fraction of India’s $500 billion retail market. But sales are soaring as young people, who are spending more and more time on the Internet, become comfortable with online transactions.

    India now has about 20 million active online shoppers, who mostly browse online for clothes, accessories, footwear, consumer electronics and beauty products. A majority of these customers live in the country’s bigger cities. 

    They are being lured by companies like Snapdeal.com. 

    Kunal Bahl, co-founder of Snapdeal.com, went online three years ago after many customers said they wanted to buy the coupons and discount cards he sold through stores on the web. Today his online site has expanded into selling an array of retail products.

    “We instantly saw action," he said. "What we thought we would do in sales in three months, we did in one week, in the first week. And that gave us further conviction that for completely uninitiated entrepreneurs in the online space, we seemed to be doing reasonably well. So clearly that is not because of our efforts, but because of the inherent demand that exists in the market.”

    Bahl hopes that he will hit sales of $1 billion by 2015.

    Turning a profit

    However, growing sales may not solve the problems faced by online retailers. That is because while the number of transactions is growing by the day, companies are still struggling to turn in profits.

    Shabori Das at the market research firm, Euromonitor, says most online retail companies lure customers by offering big discounts, free deliveries and the option to pay cash on delivery. He says that is hurting their profit margins. 

    “When you compare the average cost of acquisition of a customer, it is very high as compared to the average item sold through a website," said Das. "When you are acquiring a customer, you have to take into account the cost of the item, the cost of shipping, the cost of packaging and in most cases when you do cash on delivery, you are basically providing the product on credit. So these expenses add up.”

    Still the retail goods market that is expected to grow by 17 per cent every year is encouraging more and more entrepreneurs to go online. They say the lack of infrastructure in Indian cities will encourage more people to shop on the web in the years to come. Many of the smaller towns lack supermarkets or shopping malls. In bigger cities, traffic snarls and parking woes sometimes deter even committed shoppers from venturing out.     

    Success story

    Rahul Jagtiani, whose family is in the interior design business, defied skeptics to go online with plushplaza.com, which sells home décor and gift items.  

    "That time everybody felt this is not going to work online, there is a certain emotional connect, there is the whole touch and feel factor which you don’t get. But I felt if products are showcased well, and the photography is good and your integrity is good, we can bridge that gap, and it’s been pretty good so far," Jagtiani said.

    Business has been good due to customers like Shweta Andrews, who say online shopping is the way to go.

    "Online, what happens is, you always get discounts. No matter what season, whether it is fresh stock or anything, you always get discounts. That is the benefit. You save time, you save money," Andrews said.

    Two thirds of India’s 1.2 billion population is under 35 years of age. Market research firms say that is exactly the segment that has growing incomes and aspirations, and is expected to drive the overall e-commerce market up from $10 billion at present to $70 billion by 2020.

    You May Like

    US-Russia Tensions Complicate Syria War

    With a shared enemy and opposing allies, Russia and the US are working to avoid confrontation

    Video Re-opening Old Wounds in Beirut's Bullet-riddled Yellow House

    Built in neo-Ottoman style in 1920s, it is set to be re-opened in Sept. as ‘memory museum’ - bullet-riddled walls and bunkered positions overlooking city’s notorious ‘Green Line’ maintained for posterity

    Cambodian-Americans Lobby for Human Rights Resolution

    Resolution condemns all forms of political violence in Cambodia, urges Cambodian government to end human rights violations, calls for respect of press freedom

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Brexit Vote Plunges Global Markets Into Uncharted Territoryi
    X
    June 24, 2016 9:38 PM
    British voters plunged global markets into unknown territory after they voted Thursday to leave the European Union. The results of the Brexit vote, the term coined to describe the referendum, caught many off guard. Analysts say the resulting volatility could last for weeks, perhaps longer. Mil Arcega reports.
    Video

    Video Brexit Vote Plunges Global Markets Into Uncharted Territory

    British voters plunged global markets into unknown territory after they voted Thursday to leave the European Union. The results of the Brexit vote, the term coined to describe the referendum, caught many off guard. Analysts say the resulting volatility could last for weeks, perhaps longer. Mil Arcega reports.
    Video

    Video Orlando Shooting Changes Debate on Gun Control

    It’s been nearly two weeks since the largest mass shooting ever in the United States. Despite public calls for tighter gun control laws, Congress is at an impasse. Democratic lawmakers resorted to a 1960s civil rights tactic to portray their frustration. VOA’s Carolyn Presutti explains how the Orlando, Florida shooting is changing the debate.
    Video

    Video Tunisian Fishing Town Searches for Jobs, Local Development Solutions

    As the European Union tries to come to grips with its migrant crisis, some newcomers are leaving voluntarily. But those returning to their home countries face an uncertain future.  Five years after Tunisia's revolution, the tiny North African country is struggling with unrest, soaring unemployment and plummeting growth. From the southern Tunisian fishing town of Zarzis, Lisa Bryant takes a look for VOA at a search for local solutions.
    Video

    Video 'American Troops' in Russia Despite Tensions

    Historic battle re-enactment is a niche hobby with a fair number of adherents in Russia where past military victories are played-up by the Kremlin as a show of national strength. But, one group of World War II re-enactors in Moscow has the rare distinction of choosing to play western ally troops. VOA's Daniel Schearf explains.
    Video

    Video Experts: Very Few Killed in US Gun Violence Are Victims of Mass Shootings

    The deadly shooting at a Florida nightclub has reignited the debate in the U.S. over gun control. Although Congress doesn't provide government health agencies funds to study gun violence, public health experts say private research has helped them learn some things about the issue. VOA's Carol Pearson reports.
    Video

    Video Trump Unleashes Broadside Against Clinton to Try to Ease GOP Doubts

    Recent public opinion polls show Republican Donald Trump slipping behind Democrat Hillary Clinton in the presidential election matchup for November. Trump trails her both in fundraising and campaign organization, but he's intensifying his attacks on the former secretary of state. VOA National Correspondent Jim Malone reports.
    Video

    Video Muslim American Mayor Calls for Tolerance

    Syrian-born Mohamed Khairullah describes himself as "an American mayor who happens to be Muslim." As the three-term mayor of Prospect Park, New Jersey, he believes his town of 6,000 is an example of how ethnicity and religious beliefs should not determine a community's leadership. Ramon Taylor has this report from Prospect Park.
    Video

    Video Internal Rifts Over Syria Policy Could Be Headache for Next US President

    With the Obama administration showing little outward enthusiasm for adopting a more robust Syria policy, there is a strong likelihood that the internal discontent expressed by State Department employees will roll over to the next administration. VOA State Department correspondent Pam Dockins reports.
    Video

    Video Senegal to Park Colorful ‘Cars Rapide’ Permanently

    Brightly painted cars rapide are a hallmark of Dakar, offering residents a cheap way to get around the capital city since 1976. But the privately owned minibuses are scheduled to be parked for good in late 2018, as Ricci Shryock reports for VOA.
    Video

    Video Florida Gets $1 Million in Emergency Government Funding for Orlando

    The U.S. government has granted $1 million in emergency funding to the state of Florida to cover the costs linked to the June 12 massacre in Orlando. U.S. Attorney General Loretta Lynch announced the grant Tuesday in Orlando, where she met with survivors of the shooting attack that killed 49 people. Zlatica Hoke reports.
    Video

    Video How to Print Impossible Shapes with Metal

    3-D printing with metals is rapidly becoming more advanced. As printers become more affordable, the industry is partnering with universities to refine processes for manufacturing previously impossible things. A new 3-D printing lab aims to bring the new technology closer to everyday use. VOA's George Putic reports.
    Video

    Video Big Somali Community in Minnesota Observes Muslim Religious Feast

    Ramadan is widely observed in the north central US state of Minnesota, which a large Muslim community calls home. VOA Somali service reporter Mohmud Masadde files this report from Minneapolis, the state's biggest city.

    Special Report

    Adrift The Invisible African Diaspora