Online shopper base to grow to 100 million

Rising consumer confidence and growing internet penetration is set to help e-commerce become a $15 billion market by 2016. According to an online shopping growth trends report released by Google on Thursday, India’s e-tailing market is at an inflection point and will have nearly 100 million online shoppers by 2016.

The online shopper base was pegged at 8 million in 2012 and grew to 35 million by 2014.

Gender bender The research which was done in collaboration with Forrester Consulting revealed that women buyers are set to become one of the significant contributors to the growth of online shopping.

Out of the 100 million buyers, nearly 40 million women are estimated to shop online in India by 2016. The research said that women buyers in Tier 1 cities were found to be far more engaged in online shopping and outspend men by 2x. Categories like apparels, beauty & skincare, home furnishing, baby products and jewellery were largely being driven by women consumers.

The research was conducted among 6859 respondents covering both online buyers and non-buyers in 50 cities and town. Factors like convenience and variety is what led the respondents to buy online. Over 60 per cent respondents also felt that buying online was directly co-related with social status.

Google India MD Rajan Anandan said, “The online shoppers base will grow 3x by 2016 and over 50 million new buyers will come from Tier 1 and Tier 2 cities. The consumer confidence to shop online has grown significantly in last year and a half. Nearly 71 per cent non-buyers from Tier 1 and Tier 2 cities said they plan to shop online in next 12 months.”

The research also reveals that mobile is at the heart of online shopping. One out of three buyers in Tier 1 and Tier 2 cities are transacting through mobile. Added Nitin Bawankule, Industry Director for Ecommerce, Local and Classifieds, Google India, “The e-tailing industry needs to act now to cater to this strong user growth trend. Improved customer experience across all touch points, easy to use mobile apps can create a strong pull for non-buyers to shop online in Tier1 and Tier 2 cities.”

Barriers In terms of challenges, 62 per cent buyers said they were not satisfied with their online shopping experience, while 67 per cent said 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. Respondents expressed concerns about safety of online transactions