India's e-commerce landscape is witnessing a significant surge in online shopping, with consumers from Tier II cities and beyond leading the trend, according to CyberMedia Research (CMR). The study sheds light on the changing dynamics of the Indian retail market and highlights the preferences and habits of online shoppers.
The report reveals that Indians from Tier II cities spend an average of two hours and 25 minutes per week shopping online, devoting approximately 16 percent of their income to these purchases. Among the Tier II cities, Guwahati, Coimbatore, and Lucknow stand out for their high engagement in e-commerce, with Bengaluru leading among Tier I cities, spending a maximum of four hours and two minutes weekly on online shopping.
According to Prabhu Ram, Head-Industry Intelligence Group, CMR, “The wide range of choices, convenience, and comfort provided by eCommerce has empowered emerging young consumers in Aspirational India (Tier II, Tier III cities and beyond) to shop more online and to fulfill their aspirations. Major players like Amazon and Flipkart, niche market players such as Meesho and others, and conglomerates like Tata and Reliance are fiercely competing in these markets. Our research emphasises that Amazon, with its extensive and enduring presence across India, has the consumer trust and is their preferred choice.”
The study identifies three key triggers for online shopping: attractive prices, convenient return and exchange processes, and irresistible offers. These factors are driving the growth of the e-commerce market in India, enticing consumers to make their purchases online.
Some intriguing insights from the study include the rise of online shoppers, with women entrepreneurs and others spending an average of 149 hours annually on e-commerce. Notably, Gen Z shops more frequently online than millennials. Furthermore, two-thirds of consumers have spent up to Rs 20,000 on online shopping in the past six months, with Mumbai exhibiting the highest average spend at Rs 24,200.
Clothing and accessories, along with electronics and electronic gadgets, top the list of products purchased online, with smartphones, headphones/earphones, and smart bands/smartwatches being the most popular electronic gadgets. In terms of electronics, Nagpur leads the way, with 81 percent of consumers purchasing electronics and electronic gadgets online.
The study also delves into the preferences and considerations of Indian consumers in various categories. For smartphones, 5G compatibility is highly important, with 57 percent of smartphone users prioritising it in their next purchase. Laptop sales are driven by the need for any time, anywhere work and learning, while battery life, 5G capability, and operating systems are key factors influencing tablet purchases.
When it comes to the choice of e-commerce platforms, Amazon emerges as the most preferred, followed closely by Flipkart. Amazon's attractive prices, easy return/exchange process, brand trust, and convenience of shopping across pin codes in India are cited as reasons for its popularity. User satisfaction is high, with 63 percent of Amazon users reporting satisfaction, followed by 52 percent for Flipkart.
Sugandha Srivastava, Senior Manager, Industry Consulting Group (ICG), CMR, believes that both online and offline retail will continue to co-exist in a diverse market like India. “As consumers continue to gain digital fluency, the eCommerce boom will also significantly benefit small business owners as well. This will contribute to the rise of India’s trillion-dollar internet economy,” she added.
First Published: Jun 28, 2023 4:33 PM IST
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