Globalization and E-Commerce in India: Issues and Challenges

Pooja Malhotra
2016 Social Science Research Network  
La globalización y el comercio electrónico en la India: problemas y retos ABSTRACT. The role of Information Technology (IT) is indispensable in making the Indian economy globalised. Globalization has turned the whole world into a single market. Marketers have optimally utilized IT particularly internet and mobile applications to make their business global. The present paper is a descriptive paper analyzing the emerging trends and issues in IT particularly ecommerce sector in India in the wake
more » ... globalised economy. It tries to explore the challenges in the growth and development of this emerging sector and also suggest the ways to manage these challenges. By 2016, a number of 653 million people in the Asia Pacific region are expected to buy goods and services online, a figure which means over 48 percent of internet users are purchasing goods and services online in the Asia Pacific region. Most popular product categories among online shoppers in this region include airline tickets and reservations, cosmetics, baby supplies, clothing, accessories and shoes, as well as computer hardware and software. The number of online buyers in India is expected to reach 41 million by 2016, representing around 27 percent of the total number of internet users in the country. Moreover, a rising number of people in the area of Asia Pacific are increasingly using their mobile phones for online shopping. In India, some 9 percent of the country's population had made a purchase via mobile phone within the past month, as of the fourth quarter of 2014. Digital buyer penetration in India is low. Less than one-quarter of internet users in the country made a digital purchase during 2014, eMarketer estimates, and by 2018, that figure will still be just 29.0%. That compares with over 81% last year in Japan and 55.2% in China. 6. Growth in e-commerce market: Asia Pacific region has become the leader of ecommerce industry with an expected 33 percent of the global market in 2015 and over 37 percent in 2018. In fact, China, is not only driving the region's leadership due to its unprecedented economic boom, but is also set to beat the United States as the single country with the largest e-commerce market in the world. After China, another emerging Asian market in terms of e-commerce is India. Recent statistics show that retail e-commerce sales have grown enormously, from $2.3 billion in 2012 to an estimated $17.5 billion in India, depicting an almost eight-fold growth. The retail e-commerce sales account for 0.9 percent of all retail sales in India as in 2015, but this figure is also expected to grow in the near future, reaching 1.4 percent in 2018 (Exhibit 6). Up from $3.59 billion in 2013 to $5.30 billion in 2014 (an extraordinary increase of 47.6%), it is expected to grow by 45.2% this year and reach $7.69 billion. By the end of 2018, it is expected to touch $17.52 billion. The ecommerce sales (which includes all products ordered over the internet except travel) continues to register an unprecedented growth and increase by leaps and bounds over the 2013-2018 period. Increased product information One never purchases non-essential items unless one is influenced. Internet allows customers to read reviews about a product. Many people are of the view that e-retailing has, in fact, increased demand for goods. This increase is well reflected not only on e-retails but in the traditional stores as well. E-retailing has, in a great way, increased product awareness in desired, specific customer segments. Almost 75% of the ecommerce space is controlled by travel websites but the online retail segment, both consumer electronics and apparel and accessories, is also growing quickly.
doi:10.2139/ssrn.2759762 fatcat:vnzn5izv2nhq7jpj7aertp7zx4