By 2016 online shopper base to rise to 100 Million in India

The consumer confidence to shop online will continue to rise, and India will have 100 million online shoppers by 2016. This was revealed by Google in its annual online shopping growth trends report, compiled by combining an extensive research conducted by Forrester Consulting and Google search trends. The report revealed that India’s e-tailing market is at an inflection point and will see rapid growth to become a $15-billion market by 2016.

The research conducted by Forrester Consulting by interviewing 6,859 respondents covering both online buyers and non-buyers in 50 cities/towns, revealed  that online shoppers base will grow 3x by 2016, and over 50 million new buyers will come from the Tier-I and Tier-II cities.  The confidence to shop online was on the rise as 71% non-buyers from the Tier-I and -II cities said they plan to shop online in the next 12 months. The findings also revealed that women buyers in the Tier-I cities were more engaged in online shopping, and outspend men by 2x.
Women were also responsible for driving growth in categories like apparels, beauty & skincare, home furnishing, baby products and jewellery. This research finding was consistent with search query trends seen on Google with search query volume for apparels growing at (64% y-o-y), Baby Care (53%yoy), Beauty & personal care (52% y-o-y) and home furnishing growing at 49% year on year.

Mobile phones emerged as an important access device for online shoppers with one out of three online buyers transacting on their mobile phones in the Tier-I and Tier-II cities. In the Tier-III cities, one in two buyers said they use mobile phones to purchase products online. This was also reflected in the Google search trends with mobile phones queries growing 3x in the last three years. Today, over 50 per cent of shopping queries were coming from mobile phones. This share was as low as 24% just two years back.

Nitin Bawankule, Industry Director – E-commerce, Local and Classifieds, Google India, said,
“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 the Tier-I and -II cities. Women buyers are set to become the most significant contributor to the growth of online shopping and there is a huge opportunity waiting to be unlocked in this user segment.”

Amongst the challenges, 62 per cent buyers said they were not satisfied with their online shopping experience. 67 per cent buyers also highlighted that the current return process was too complicated and expensive. Trust was a major issue with non-buyers; 55 per cent non-buyers did not trust the quality of products sold online; 63 per cent said they were concerned about the safety of transacting online; and 65 per cent said they don’t feel comfortable sharing personally identifiable information online. 66 per cent of total respondents said that poor connectivity was also a major barrier for them to shop online