Brand news

Internet penetration is bridging the gap between consumers residing in tier-I, tier-II cities: WATConsult Report

31 Aug 2018

WATConsult has launched its latest report titled 'E-Commerce in India; Consumer perspective', that maps the changing consumer behaviour and their perspective on the current e-commerce market in India. Click on the link or scroll down to read the full story.

In India, e-commerce portals and marketplaces have established themselves by providing huge discounts to bring customers on board and thus changing the consumers’ mindset by providing wider range of products to choose from. In spite of the huge opportunity, due to the size and growth of the ecommerce market, it imbibes its own set of challenges such as certain efficiencies in the payment and delivery mechanisms which are missing and a need to be addressed.

The recent drive towards a digital economy thanks to demonetization along with improvement in net banking facilities has further fueled the growth of e-commerce in the country. The government’s initiatives to develop cash-less, inclusive and digital citizens has provided a robust boost to e-commerce industry in addition to an increasing number of consumers adopting digital transactions. E-tailers have started launching their private fashion labels to increase their profit margins. It has become imperative for the manufacturers to cater to the consumers according to their taste and preference.

With mass media penetration and growing disposable income, Indian consumers have become more demanding and adaptable to change in fashion. With the rapidly changing profile of consumers, it has become challenging for retailers to keep up with shifting shopping demands. Shoppers today are well informed about fashion trends and demand accordingly. Thus, it becomes challenging for retailers to cater their customers with constant change in preferences.

E-commerce is set to continue to grow and emerge to be a factor of a sustainable ecosystem. The radical transformation of the business landscape has lead to capturing opportunities in the market with innovative business models.

The major findings of the report can be summarized as:

  • Majority of the E-commerce consumers are in the age group of 25 - 36 years. The age group above 37 years spends a higher amount on E-commerce than the rest of the customers.
  • The Merchant categories of cab booking and travel has the highest average monthly transactions per customer indicating the growth of the segment.
  • Transaction behavior of Loyal consumers is more habit and deal based while that of Switcher consumers is more need based.
  • The increased penetration of the internet in the Small town and small metros have changed the demographics and the nature of the customer behavior towards E-commerce.
  • E-commerce. The adoption of E-Commerce in the small metros and towns has been on a steady rise.
  • Merchant categories of Travel, Electronics and Fitness have the highest daily expenditure followed by E-tail, Lifestyle and Home Decor categories. Cab bookings and Travel categories have the highest average monthly transactions