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Online retail traffic in India up 65% this festival season: Assocham news
16 August 2013

Online retail web sites have recorded a 65 per cent rise in traffic this festival season compared to last year, according to a survey by the Associated Chambers of Commerce and Industry of India (Assocham).

The market for online shopping in India is estimated at Rs52,000 crore and is expected to grow at 100 per cent per year. The online shopping industry in India is fast catching on, not just in the larger metros but also in the smaller cities, according to the survey.

''Shopping trends of Indian consumers have witnessed a significant change this Raksha Bandhan, leading to a record 65 per cent rise in online trends over the regular shopping compared to last year, according to Assocham's latest survey.
Delhiites topped the list of online shoppers with 62 per cent, followed by Mumbaikars and Ahmedabadis in that order.

As per the survey, 62 per cent of Delhiites prefer shopping online while 30 per cent prefer to shop in traditional markets like Sarojini Nagar, Lajpat Nagar, Karol Bagh, Janpath, Paharganj, Sadar Bazar and Chandni Chowk. Around 6 per cent of respondents said they preferred to visit a mall for their shopping needs while 2 per cent said they preferred shopping at specialty stores, the survey stated.

''This festive season, there is a 65 per cent more traffic in online retail web sites and shopping on ground has taken a back seat. Apart from convenience, rising fuel price, security reasons, online discounts and availability with abundance of choice are keeping them indoors,'' said D S Rawat, secretary general of Assocham, while releasing the survey.

The survey covered around 5,000 shoppers in Delhi, Mumbai, Chennai, Bangalore, Ahemdabad, Kolkata and other cities.

In cities like Chennai, 40-45 per cent are expected to buy gift articles, magazines, home tools, toys, jewellry, beauty products, and sporting goods categories online against 30 per cent of choosing to buy daily routine products online in 2012-13.

In Kolkata, the share of online shopping is expected to go up to 25-30 per cent this fiscal from 15-20 per cent last year. The city recorded highest e-sales of online music and movies.

Bangalore's share in e-shopping for books, electronic gadgets, accessories, apparel, gifts, computer peripherals, movies, hotel booking, home appliances, movie tickets, health and fitness products and apparel gift certificates is expected to touch 45-50 per cent this fiscal from 20-25 per cent last fiscal.

The survey also revealed that non-resident Indians (NRIs) are more actively shopping online during the festival season. During Raksha Bandhan, online shopping by NRIs contributes 60-70 per cent of the total shopping, whereas during Diwali, it increases to 90 per cent.

The study finds that 35 per cent of regular shoppers are in the 18-25 age group, 55 per cent in the 26-35 age group, 8 per cent in the 36-45 age group and 2 per cent in the age group of 45-60. Interestingly, 85 per cent of online shoppers are male as against 15 per cent females.

According to a majority of the respondents, ''Online retail industry's business is quite good. Heading out to shop on day off by battling traffic, parking issues, and long lines for bill payment is quite a cumbersome process and this is the main reason for the shift in trend''.

The business module is cost-effective, easily accessible and profitable in many functional areas.

''Consumers and retailers both desire safe, simple and comprehensive online shopping that will truly realize the range of power of the internet", the survey adds.

According to the survey, India has more than 100 million internet users, out of which around half opt for online purchases and the number is growing every year. With such a large market size, companies, right from retail shops to consumer goods, are entering the web space to attract potential customers, adds the survey.
With more online shops registering 100 per cent annual growth, many retail chains and consumer durable companies are joining the web bandwagon to tap the e-shopping market, the report adds.
''In India, customers wait for the festive season to get the best deals on all their shopping needs. The idea is to provide customers with an unmatched shopping experience ahead of the festive season with a fabulous range of products at unbeatable prices'', commented Rawat.

''Customer behaviour is changing dramatically. People are not only using the web to book air tickets and movie tickets but also do not hesitate in placing orders for mobiles, laptops and other consumer electronics and home appliances," says Rawat.
Seeing the consumer response, more companies are collaborating with such daily deal and discount sites. Even traditional retailers like Shoppers Stop, Westside and Pantaloons are looking at the online shopping space for growth, adds Rawat.

The products that are sold most are in the tech and fashion category, which include mobile phones, ipads etc, according to the survey.

Products bought and sold through the online channel, the survey revealed, were:

  • Gift articles: 58 per cent
  • Books: 42 per cent
  • Electronic gadgets: 41 per cent
  • Railway tickets: 39 per cent
  • Accessories apparel: 36 per cent
  • Aapparel: 36 per cent
  • Computer and peripherals: 33 per cent
  • Airline tickets: 29 per cent
  • Music: 24 per cent
  • Movies tickets: 26 per cent
  • Hotel rooms: 20 per cent
  • Mmagazines: 19 per cent
  • Home tools and products: 16 per cent
  • Home appliances: 16 per cent
  • Toys: 16 per cent
  • Jewellery: 15 per cent
  • Beauty products: 12 per cent
  • Health and fitness products: 12 per cent
  • Apparel gift certificates: 10 per cent
  • Sporting goods: 7 per cent

Emerging online shopping trends also include imported wines and juices, chocolates etc, which point towards luxury shopping.

These clearly show that online shopping has truly come of age and consumers are keen to shop on the net, the survey says, adding, ''Festival shopping is the prime time for multi-channel retailers to attract new shoppers''.
The reasons for e-shoppers number multiplying are because of factors such as home delivery which saves time, secondly '247' hours shopping with ease and availability factors for product comparisons, the survey adds.

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Online retail traffic in India up 65% this festival season: Assocham