Ecomm Expansion in India will Trigger Big Innovations, says Study
New Delhi: Expansion of India’s ecommerce industry will trigger innovation in payments and delivery models as well as enable better use of technology such as wearables, drones and artificial intelligence, a study by Confederation of Indian Industry and Deloitte has said.
In the report titled ‘e-Commerce in India: A Game Changer for the Economy’, CII director general Chandrajit Banerjee said the ecommerce industry has been directly impacting micro, small and medium enterprises and has a favourable cascading effect on other industries.
“It is helping connect small merchants with customers across India. Long-term impact of this on the economy would be increase in employment, growth in export revenue, better products and services to customers and increase in tax collection by exchequers,” the report said.
Increasing internet and smartphone penetration are expected to boost expansion of ecommerce sector in tier-II and tier-III cities, the report said. It said the biggest challenges to the industry’s growth have surfaced primarily in areas of taxation, logistics, payments, internet penetration and skilled manpower.
“Going forward, the most important thing is the collaboration between the government, industry and academia to improve efficiencies in ecommerce,” said Viresh Oberoi co-chairman of CII’s national committee on ecommerce.
“We are engaging with the government in states and at the Centre to help create an enabling environment for the industry,” he said.
The number of online shoppers in the country grew 95% between 2013 and 2015, and the number is expected to reach 140 million by 2018 and 220 million by 2020, the report said. According to the report, the number of online shoppers in India as a percentage of total internet users grew to 11% in 2015 from 9% in 2013. It is expected to reach 36% by 2020.
“From an investment perspective, considerable funding in the e-commerce ecosystem has led to emergence of new business models across B2B, B2C, logistics service providers, payment wallets, digital advertising and analytics,” Neeraj Jain, partner at Deloitte Touche Tohmatsu India LLP said. He said these investments have enabled the ecommerce companies to leverage leading technology and related practices to reach out to millions of new online customers by delivering services more effectively and efficiently.
The report said there is a much greater scope for ecommerce players to leverage technology in a big way, especially the unified payments interface platform that can make payment modes such as cash on delivery seamless.
Another area where technology can work is the way in which goods are delivered to the user.
Increasing internet and smartphone penetration are expected to boost expansion of ecommerce sector in tier-II and tier-III cities across the country