Indian online shoppers to rise to 175 mn by 2020

India’s online retail industry is on a roll. According to a study conducted by Google and A.T. Kearney, the industry is set grow at a robust pace by 2020 with the number of online shoppers rising three times to 175 million shoppers by then.

The study titled Digital Retail 2020, says that the top one-third of the customers or the 60 million of the 175 million shoppers in 2020 will be "high-value customers" and that segment will "drive two-thirds of the total spend. Women buyers will also double their share in the online spend to about 40 per cent in 2020."

“The e-tailing industry in India is at an inflection point and will touch 175 million online buyers by 2020. Having said that, the next three to four years will be critical for the Industry to get on the path of sustained profitability,” said Rajan Anandan, vice president and managing director, Google Southeast Asia and India.

Some factors including being able to choose their delivery time, picking up shipment without divulging personal details are things which are expected to increase spend across categories, the survey said.

According to the study, "one in four women respondents said they will start shopping online if e-tailers also have an offline presence," giving further credence to the omni-channel retail. The study surveyed more than 3,000 respondents.

The survey found that men typically purchase consumer electronics, lifestyle and books and media while women prefer lifestyle, consumer electronics and personal care products more.

On the supply side, the online sellers will have to grow by five times in order to cater to the expected surge in demand in the next four years, the study found. Recently introduced government rules that mandates marketplaces with foreign investments to cap sales originating from a single seller to 25 per cent will spur etailers to diversify their seller base. However, this must include education and awareness on the part of the seller about the benefits of going online and financing, the Google-AT Kearney report said.

"Back-end operations and delays in settlement of cash payments" are among the other points of contention which might discourage sellers from going online and which need to be addressed as soon as possible, it said.