The Indian E-tailing industry experienced a small hiccup in its growth story in CY’16. While in 2015, the industry grew at 180% to become a USD 13 Bn. sector, it grew at a meagre 12% in 2016 to clock USD 14.5 Bn. What led to this slow-down is analyzed here.

The biggest impact of this adverse market condition was faced by the established players like Flipkart and Snapdeal, whose growth remained flat, if not worsened. Whereas, the new entrants like Amazon have succeeded in altering the market share game and captured big portion of the aggressively-contested industry.

2017 comes as a year the Indian E-tailers are banking heavily on. The new year is expected to be a lot more positive, although a lot is riding on –

  • The ability of e-tailers to grow their customer base from the existing 15+ million monthly unique shoppers
  • While the big bucks come from mobile and electronics categories, the forecasted growth depends on non-mobile categories like Fashion and Grocery
  • The response of the weakening giants like Flipkart and Snapdeal and change in their strategies to counter the competitors
  • Uptake of membership programs like Amazon Prime by the consumers

Commenting on the findings of the research, Anil Kumar, Founder and CEO, RedSeer Consulting said, “The Indian E-tailing players might have faced a lot of challenges in 2016, but fundamentally this sector is expected to grow 4x-5x times in the next 4 years. 2017 will be a hotly-contested year, and will differentiate the best from the rest, and also shape the Indian E-Commerce industry for the many years to follow.”

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