eCommerce today is known for giving a platform to some of the niche categories such as lingerie, baby products, pet food, gardening, adult products and many more. The sector hasn’t only attracted budding entrepreneurs, but has also lured some of the top executives from brands like Microsoft and Google. Moreover, the technology advancements, better logistics and supply chain mechanisms have made this sector quite appealing.
Scope in Indian eCommerce industry
With Indian government planning to bring FDI in eCommerce, one can easily ascertain the value this sector is playing in the Indian economy. Currently, the organized retail market in India is valued at USD 41.44 Bn off the total USD 518 Bn retail market.
The online retail in India, on the other side, is a mere 0.6 Bn, i.e. 1.44% of the organised retail segment of the country. However, as per the recent Assocham report, the Indian eCommerce market is now valued at USD 16 Bn in 2013 and is expected to reach USD 56 Bn by 2023.
According to Manish Chopra, founder of Zovi, Indian industry provides a “phenomenal opportunity” to existing online retail businesses. Moreover he believes that the market offers a good scope for players to raise outside funding if they have a promising and economically sound business model.
Factors driving this growth
Various factors which have driven this growth include:
- Increasing Internet penetration
- Cheaper smartphones and data packages
- Available payment options and SaaS providers
- Fast moving lives with shortage of leisure time
Also, aggressive online discounts, rising fuel prices and availability of abundant online options have played a crucial role in attracting shoppers.
However, with all the foreseen viable future opportunities in the space, building and managing an online retail store has to move through a lot many crunches. Dealing with online price wars, raising funds, managing scales, CRM, identifying what sells or not, opportunities in rural or urban, etc are few of the challenges that one needs to focus upon while entering into this space.
To contact the author, email at email@example.com. Discover more on latest startup trends in eCommerce at the upcoming #IRE2014Category Ecommerce Startups