Electronic commerce or e commerce in India has experienced a drastic boost lately. Especially in metropolitan cities like Delhi, Mumbai, Bangalore etc. the internet user base is large, in the order of millions. India had the user base of about 354 million as of June 2015 and the figure has been rising since then. It is the second largest user base in the world, only behind China.
The penetration of e-commerce has been rapid in cities covering almost whole of the population, just leaving a small fraction. Whereas penetration has been less in other parts of the country which form the majority, this reduces the overall penetration of e-commerce compared to markets like France or the United States of America. On an average about 6 million users are added every month. Growth of the industry is considered to be at an inflection point. The market in India was worth $3.9 billion in 2009 and has gone up to about $100 billion in 2016. By 2020, it is expected to generate $100 billion online retail revenue solely.
According to a study carried out by the Internet and Mobile Association of India, 61% of the e commerce in India is travel related.
E-commerce involves the process of buying and selling of products, services, and information via computer networks using the internet. It occurs between companies, companies and their customers, and companies and the government. The largest e commerce in India are Flipkart, Snapdeal, Amazon India and Paytm. New sectors in e-commerce are medicine, though there are no dedicated online pharmacy laws in India. Prescription medicines are sold with a legitimate licence.
Not all firms and services are suitable for e-commerce because they provide much less security of money and transactions. Most websites are not threat protected. It is required to have a strong infrastructure to provide a platform for hosting web stores. Highly secure, stable and protected hosting is necessary.
The spread of e-commerce is appealing for most start-ups as it provides wider reach to customers spread over different parts of the world. Business firms can establish direct contact with the costumers. This saves the cost of intermediaries and middlemen. The biggest advantage of e-commerce is saving of time and effort. This platform is environmental friendly as there is paperless exchange of information.
Quick delivery and supplies make e commerce in India a hit. All the payments can be made online though there are options of other modes of payment too. In India, cash on delivery is the most preferred mode of payment. It accumulates 75% of the e-retail activities.
People increasingly prefer online shopping over in store shopping. It is favoured because of the comfort of exploring different products at a click and then finding them at the doorstep. A large number of options are available to the customer. Products can be compared easily.
E commerce lacks person touch of warmth of inter-personal interactions between the seller and the buyer. Indian consumers are used to the personalised services and yet we can see the boom in e-retail. This is a little perplexing but can be understood as a fact that younger people are technology savvy and they try to save as much time as possible.
Millions of potential online customers have fear for the proper online security. They are not comfortable giving out their credit or debit card details. They feel reluctant to do this because of the potential cyber crimes. Customers need to feel confident about the integrity of the transaction process before they commit to the purchase.
The Government of India has understood the pace of technology at which the world is moving. Many utility services that are provided can be paid for online. Electricity bills to house tax, almost everything is done via the internet. The hosting provided by the government for online transactions are highly secure which makes it even easier for the consumer to pay the bills.
Our government aims on having a cashless economy, especially after demonetisation on December 8, 2016. This will give rise to increase in e-commerce. This will help make the system transparent as the aim requires.
E commerce is an industry which is growing at a tremendous rate and will continue to do so as there are many potential customers out there. The widespread of technology will help in creating more customers.
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