India’s online spend to touch Rs875,600 crore by 2018: Report
New Delhi: Indian shoppers are likely to spend almost 85% more on global online marketplaces in 2017 across categories, said a report jointly published by digital payments platform PayPal and market research firm Ipsos.
The report titled PayPal Cross-Border Consumer Research 2016 projected that the overall online spending in the country (including domestic and cross-border) is expected to touch Rs8,75,600 crore in 2018 from the estimated Rs4,92,500 crore in 2016.
Cross-border spending in 2016 stood at estimated Rs42,400 crore, with almost 25% of the Indian shoppers claiming to have shopped from websites in other countries in the last 12 months.
“The internet has truly democratized cross border trade. The freelance economy has grown in India and a considerable number of Indians shop in the global marketplace,” said Anupam Pahuja, managing director, PayPal India.
While apparels, footwear and accessories are leading categories in cross-border shopping with 54% of the consumers spending on these products, consumer electronics stand second in the list, followed by cosmetics and beauty products, the report said.
This rise in the number of online shoppers buying from other countries is driven by a number of reasons, with free shipping topping the list.
According to the report, almost 42% of online shoppers buy from global marketplaces because of free shipping, while being able to pay in local currency is a close-second reason to shop.
“We see an increase in shopping of tech and mobile accessories/ watches etc from Chinese websites. These are functionally superior products at a low cost which the Indian shopper is willing to take a risk and wait for a month to get delivered. There is another high-end set of customers who want specific products from global marketplaces and they don’t mind paying customs duties. These are in areas like designer fashion, accessories and watches, personal care products etc,” said Sreedhar Prasad, partner e-commerce, KPMG in India.
“Internet has blurred the boundaries for the e-commerce business. There is growing trend of cross border online shopping happening in India. Especially, the young consumers have become increasingly savvy and comfortable when it comes to finding the best deal online even it means buying from e-commerce merchants operating outside India. Most preferred corridors are US, the UK and China and the demand peaks during festive seasons like Diwali and Christmas,” said Bhasker Canagaradjou, head, Ipsos Business Consulting, India.
The report further highlighted that while more than half of the total online spends in 2016 were incurred via large-screen devices (desktops and laptops), the future belongs to smartphones.
Online shopping via smartphones and tablets is estimated to reach Rs4,16,600 crore by 2018 from 2,03,600 crore in 2016.