How the e-commerce sector in India is reinventing itself after the Covid-19 surge

In the coming decades, the Covid-19 pandemic will definitely be viewed as a turning point in several industries. Although the world managed to survive the pandemic, it caused inevitable shifts in how people think about various aspects of their lives. Physical health, mental health, entertainment diversity, social interactions, cashless transactions, supply chain, and eCommerce are some domains that have completely been transformed by the pandemic. 

Although Covid-19 massively impacted economic activities and let to complete shut-down of some sectors, it definitely helped in the surge of eCommerce and increased the use of digital transactions. The average share of internet users who made purchases online increased from 33% in developing countries before the pandemic to more than 60% following the onset of the pandemic, across 66 countries with statistics available.

Official statistics, available for seven countries that together comprise around half of global GDP, indicate that online retail sales increased substantially in these countries from around $2 trillion in 2019, immediately prior to the pandemic, to around $2.5 trillion in 2020 and $2.9 trillion in 2021. As social distancing became the “new normal”, businesses gradually transformed themselves along with the world. Online businesses started to grow as more and more consumers started to buy their daily necessities through the help of online platforms and websites. 

Several social media platforms took advantage of higher online retail demand by adding more commerce features, enabling shoppers of participating online retailers to browse and purchase products without ever leaving the platform. These platforms are typically closely integrated with ecommerce platforms so that ecommerce operators can easily promote their products in multiple places. Big strides were made over the course of the pandemic in various contactless payment options. eMarketer reports that the number of people globally who used proximity mobile payments in 2020 grew 22.2% year over year.

This gave rise to E-commerce platforms. More and more people started to search for platforms who can cater to their various needs – starting from Groceries to medical supplies to beauty and wellness products, they started to expect everything in one place. 

Exclusive platforms who only catered to one segment of the industry – such as Beauty platforms, Wellness platforms, Medical platforms started to rise thereby giving hope to small brands as well to showcase their products. This helped in the surge of the E-commerce platforms. Alibaba, Amazon, JD.com and Pinduoduo increased their revenues by 70% between 2019 and 2021 and their share of total sales through all these 13 platforms rose from around 75% in 2018 and 2019 to over 80% in 2020 and 2021. Expedia, Booking Holdings and AirBnB saw gross bookings decline by up to two thirds in 2020 as movement controls reduced demand for travel and accommodation services, though growth returned in 2021 as restrictions were eased.

In 2020, E-Commerce shared 17% of the global retail trade. As the country got habituated with cashless buying and selling, E-Commerce platforms seemed like a better option for them to visit instead of physically traveling to offline stores. E-commerce gave them a varied number of options for them to choose. Even if a consumer wanted one single product, they have different brands to choose the same product from. 

India has thus become one of the major Countries where local brands are getting a lot more attention than international and global brands. More and more players are coming forward as well. 

As per industry report of 2021, the Indian E-Commerce is supposed to grow 84% in the next 4 years. The report also states that this growth has been accelerated mostly by mobile shopping of products. But, a thing which needs to be kept in mind is that, the Indian retail market has not fully transformed itself, it has gone hybrid and it doesn’t depend on traditional websites to make profit. Offline retail stores have mixed up with the online ones and have created a blended digital world. 

Although, commerce trends have started to normalise post the pandemic, there are irreversible changes in consumer behaviours that will last for generations to come.

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