India became home to second biggest user base for online shopping surpassing the United States in just 2 years. The pandemic skyrocketed online retail business in India. India has the third largest shopper base internationally. It rose to 40 billion dollars in 2021 and likely to increase 150 to 165 billion dollars by 2027. That means 25 to 30 percent annual growth and doubling of market penetration to 10 percent over five years.
Mobile phones, electronics and appliances account for most of the online retail market. Fashion, personal care and grocery have the highest penetration headroom. These categories will account for two-thirds of the online market by 2027.
India’s online shopper base will rise to 400 to 450 million by 2027. Most of these customers are already in the digital funnel. 460-500 million people used social media while only 180-190 million shop online in 2021.
The reach has widened significantly with online retail accessible in 99 percent of India’s pin codes. Social media platforms are looking to leverage platform traffic to drive online sales. The 10 percent of Instagram users globally use its shop feature. The video and live commerce also offers more than 600 million users of short form video platforms expected in India by 2026.
