Slide1BI Intelligence

India represents a massive, yet largely untapped, market for online retailers. The country boasts the second-largest population in the world, and the seventh-largest economy — which grew 7.1% in 2016. Moreover, consumer spending is estimated to reach $3.6 trillion by 2020, up from a current $750 billion, increasing the country's share of global consumption to 5.8%. However, e-commerce’s share of retail in India is still a small fraction — approximately 4-6% — of the total retail market, pointing to considerable room for growth. We expect to see such advancements in the next four years, driven by a couple of important factors, including: rising internet penetration in tandem with the proliferation of mobile devices, and the government's recent demonetization efforts putting a focus on cashless payments. As the economy expands and more consumers get access to the internet, e-commerce companies will have a steady flow of new consumers to acquire. However, regulatory barriers threaten to dampen the opportunity for international e-commerce companies, which could make taking advantage of this growth somewhat challenging.

Slide2BI Intelligence

Major E-Commerce Players In India

The e-commerce market in India is more concentrated than the overall retail market, with major players Flipkart, Amazon, and Snapdeal contributing approximately 75-80% to online sales in the country.

Flipkart. Flipkart is the current e-commerce leader in India. The company has raised more than $4.6 billion in funding to date, and as of March 2017, had a 30.7% share of monthly mobile commerce users. However, it's been struggling to drive organic growth lately, seeing only an 11% increase in unique purchasers over the past year. Even more detrimental in this mobile-driven region, its mobile app engagement fell 12% year-over-year (YoY) in Q1 2017. Flipkart, in an attempt to reclaim market share, recently launched an “Express Program,” which has cut shipping times by one day.

Amazon. The US e-commerce titan accounted for 30.3% of monthly mobile [...]