India’s e-retail market has recorded 25 per cent year-on-year growth to touch $38 billion in fiscal 2021, thanks to nationwide lockdowns induced by the Covid-19 pandemic. Barring the two months of lockdown last year, the growth for the active 10-month period is in the range of 45-50 per cent, a study said.
According to a study conducted by the global consultancy firm Bain & Company, the e-retail market is likely to touch $120-140 billion by FY26, growing at an average of 25-30 per cent per annum. Smaller towns, which account for four out of five new shoppers, will be leading the growth.
In addition to small towns, women and older shoppers have gained prominence in the online shopper base over the last year. This trend is likely to continue, the study said.
In a study titled “How India shops online 2021”, Bain & Company said India already has the third-largest online shopper base globally, with 140 million e-retail shoppers in 2020, only behind China (702 million) and the US (211 million).
In the fiscal year ended March 2021, the retail market shrunk by 5 per cent, following a 7.3 per cent contraction in GDP due to sustained lockdowns across India. However, the e-retail market surged by 25 per cent to reach $38 billion despite a multi-month lockdown due to the Covid-19 pandemic.
Covid-19 provided a massive stimulus to e-retail penetration, accelerating it by 12 months to reach approximately 4.6 per cent in FY21. This increase was even higher in metro cities, as one in three people shopped online at least once across the top eight metro cities last year.
Bengaluru led the way, with one in two people shopping online at least once last year. Global e-retail markets indicate that increases should remain, sustaining at levels higher than before the Covid-19 pandemic, albeit lower than peak levels, the report said.
e-Retailers were the lifeline of both consumers and sellers. Delivery across more than 95 per cent of pin codes allowed consumers to shelter at home and prevent the spread of disease.
The study has revealed that one out of every people in metro cities shopped online last year. In Bengaluru, one out of two people shopped online at least once last year. Out of every seven people, five persons aged 15-60 years in Bengaluru shopped online at least once last year.
Electronics continues to be a growth driver and has seen a massive Covid-19 driven spurt. Online accounted for one out of two smartphone sales. An average of 160+ smartphones was sold per minute in 2020 compared to 90-110 per minute in 2018.
Deccan Herald is on WhatsApp Channels| Join now for Breaking News & Editor's Picks