E-commerce share of retail sales India 2014-2019

Over the last decade, e-commerce and digital shopping had seen a boom in India on par with the global trend. Of the total retail sales in the country, it was estimated that in 2019, the share of e-commerce would be almost five percent. In fact, the retail e-commerce sales in India was forecasted to grow at a fast pace with projections of over 45 billion U.S. dollars in 2021 from just 16 billion dollars in 2016, with an estimated retail revenue growth of over 62 billion dollars by 2023.

Market size of India’s E-commerce industry

The market size for India’s e-commerce industry was already over 50 billion U.S. dollars in 2017, and it was forecasted to be worth 188 billion dollars in 2025. However, the penetration of active e-commerce in India was just around 26 percent, compared to other Asia Pacific countries like South Korea which had over 74 percent penetration of active users. Nevertheless, this was a highly optimistic sign since it pointed out the room for growth in the Indian e-commerce market. Naturally, analysts suggested that the Indian e-commerce market was expected to surpass the United States to become the second largest e-commerce market in the world by 2034.

A cascading growth trend

According to Statista calculations, India already ranks first in terms of B2C e-commerce development with a compound annual growth rate of 17.8 from 2019 to 2023. In the last few years, B2B and B2C companies like Amazon, Flipkart and Myntra led the online shopping market in the country by collectively generating net sales of over 1.45 billion U.S. dollars in financial year 2017 alone. This high growth trend in the e-commerce industry had directly impacted the micro, small and medium enterprises in the country and had provided them with new marketing platforms along with a technological uplift.