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India's online shopping can grow to $50 bn: Report

IANS  |  New Delhi 

has the potential to generate value of over $50 billion by driving awareness, usage and transactions among the current and next set of users and shoppers, said a report on Thursday.

More than 500 million Indians will constitute the next wave of online consumers, according to a report jointly released by Bain & Company, and investment firm

With an on an average $224 per year, retail shopping in is 10 per cent of what Chinese spend, according to the report.

Currently, only 40 percent of India's 390 million users transact online, said the report titled "Unlocking Digital for Bharat: $50 Billion Opportunity".

on an average adds 40 million new users per year to online transactions, it added.

"While online spends are still low given lower per capita incomes, there is huge potential to unlock value by addressing user concerns at various stages of the digital curve; however, the path won't be easy for businesses and they will have to innovate and be patient to monetise this user base and generate value," Arpan Sheth, Partner, and one of the authors of the report said in a statement.

Based on a survey of 3,400 customers, the study found three key characteristics which affects India's digital ambition - inequitable distribution of users across socio-economic classes, small transaction base, and large drop-out rate.

Of the 390 million Internet users, 80 per cent are from affluent socioeconomic segments and penetration amongst lower income segments is only 13 per cent, the findings showed.

It also showed that only 40 percent of the today carry out digital transactions. The remaining 60 per cent do their but complete the transaction offline.

As many as 54 million users today have not carried out a transaction after the first trial purchase, the findings showed.

"With this report, we outline the need for much focused intervention for different subsets of the users who are now online and grow consumer confidence to make the digital medium a viable platform for all," Vikas Agnihotri, Industry Director, India, said.

According to the report, it takes three to four months for a to make the first

--IANS

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, August 09 2018. 18:20 IST
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