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The state of E Commerce in india april 2014

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The exclusive report on Indian Ecommerce Ecosystem by Accel Partners. This covers the ecommerce market size, Internet statistics of Indians, E commerce Trends the a great perspective on the growth story! Read On...

Text of The state of E Commerce in india april 2014

  • India e-commerce Accel Partners 2014
  • Contents S.No. Content Slide Number 1. Summary 3 - 9 2. Current Market Information 10 - 18 3. Trends 19 - 21 4. Growth Factors 22 - 25 5. Payments 26 - 27 6. BRICs comparison 28 - 31 2
  • Contents S.No. Content Slide Number 1. Summary 3 - 9 2. Current Market Information 10 - 18 3. Trends 19 - 21 4. Growth Factors 22 - 25 5. Payments 26 - 27 6. BRICs comparison 28 - 31 3
  • Executive summary 4 $2Bn 2013 $8.5Bn 2016P Online Shopping defined in this presentation does not include travel, ticketing and food ordering only physical goods commerce Online shopping of physical goods in India, will grow to $8.5Bn in 2016. Number of online shoppers in India will more than double to 40M. Key finding 2x Indian shoppers X 1.1x number of orders per year per shopper X 2x average order value 63% CAGR KEY FINDING 25% CAGR 20M 40M CY2013 CY2016P Indian online shoppers will double Accel estimates and Industry sources
  • $278 M $559 M $2,811 M CY2012 CY2013 CY2016P Fashion + Footwear + Accessories GMV INR 1,080 INR 1,860 INR 3,600 CY2012 CY2013 CY2016P Increasing average order value Executive summary Key findings 5 67% 25% CAGR KEY FINDING 1. Last year there was a significant jump in average order value as there was a penetration of new categories like jewellery, home dcor etc. 2. Also, users are becoming more comfortable buying higher priced items online. 100% Growth 71% CAGR 1. Last year was the rise of the fashion category fashion e-commerce GMV doubled since 2012. 2. Given the young demographic which is shopping for latest looks online and increasing choice online we estimate that this category will see 400% growth in the next 3 years and rival electronics and mobile category in GMV. Accel estimates and Industry sources Average order values climbing up rapidly Fashion category doubled last year
  • Executive summary 6 1x 8x 27x 2012 2013 2016P Online Shopping defined in this presentation does not include travel, ticketing and food ordering 1x 4x 24x Mobile shopping is seeing phenomenal growth Women inuenced sales will grow 5x in next 3 years 1. Mobile shopping infrastructure is improving smartphones, connectivity, mobile websites and apps 2. People are becoming more comfortable in ordering higher priced items online 1. 35% of online GMV in 2016 will be influenced by women 2. Key factor in this growth is increasing supply of women specific categories e.g. jewellery, lingerie, motherhood products Trends 2012 2013 2016P Accel estimates and Industry sources TRENDS
  • Executive Summary 7 Trends: Rise of EMIs &Wallets With increasing order values, we are seeing an uptick of EMI payments 3rd party wallets albeit a new phenomenon, have a strong value proposition and will be quick to become popular similar to China TRENDS 60% 16% 12% 12% 1% 0% 50% 12% 15% 11% 5% 7% COD Credit Cards Debit Cards Net banking EMI 3rd party wallets Indian payment landscape - rise of EMIs and Wallets (Total: 100%) 2013 2016P Accel estimates, Accel portfolio companies and Industry sources: PayU, EMVantage
  • Executive summary 8Online Shopping defined in this presentation does not include travel, ticketing and food ordering More penetration in Tier-II and Tier-III towns New shoppers will come from the 40M+ Gen-Y FB users 1. Tier 2 cities growing much faster in eCommerce adoption than Tier 1 2. Some states completely lagging in ecommerce, waiting for infrastructure to be put in place 1. Potentially 40M shoppers between ages of 19 24 years, will start spending money online 2. These shoppers also have a propensity to spend more money than Gen-X shoppers Growth factors 20M Gen-Y shoppers 20M Gen-X shoppers GROWTH FACTORS Accel estimates, Google, Facebook, NSSO, Accel portfolio companies
  • Enough headroom for growth Online retail is still a very small portion of retail in India 9 Online sales, 4 Mn, 2% Offline sales, 243 Mn, 98% 247Mn mobiles shipments in India CY2013 Online sales, 45 Mn, 7% Offline sales, 555 Mn, 93% 600Mn books sold in India CY 2013 Online sales, $0.08 Bn, 0.2% Offline sales, $44.92 Bn, 99.8% USD 45Bn jewellery sales in India CY 2013 Online sales, $0.5 Bn, 1% Offline sales, $42 Bn, 99% USD 43Bn fashion + footwear sales in India CY 2013 Accel estimates, Accel portfolio companies and industry sources: CMR, FICCI, Deloitte GROWTH FACTORS
  • Contents S.No. Content Slide Number 1. Summary 3 - 9 2. Current Market Information 10 - 18 3. Trends 19 - 21 4. Growth Factors 22 - 25 5. Payments 26 - 27 6. BRICs comparison 28 - 31 10
  • $816 M $1,983 M $8,519 M CY2012 CY2013 CY2016P Annualized online shopping GMV Growth of India online shopping 11 Market Trends Growth Factors Payments BRICS 140 M 213 M 400 M CY2012 CY2013 CY2016P Internet users in India % of internet users who visit e- commerce sites = 60% 4M 5M 12M CY2012 CY2013 CY2016P # of orders per month 3.00% 2.70% 2.90% CY2012 CY2013 CY2016P Conversion from visitors to buyers 1.50 1.55 1.70 CY2012 CY2013 CY2016P Orders per buyer per month $18 $31 $60 CY2012 CY2013 CY2016P Average order value Accel estimates, Accel portfolio companies, comScore & IAMAI
  • Growth of India online shopping 12 Market Trends Growth Factors Payments BRICS 140 M 213 M 400 M CY2012 CY2013 CY2016P Internet users in India Accel estimates, Accel portfolio companies, comScore & IAMAI
  • Growth of India online shopping 13 Market Trends Growth Factors Payments BRICS 140 M 213 M 400 M CY2012 CY2013 CY2016P Internet users in India % of internet users who visit e- commerce sites = 60% 3.00% 2.70% 2.90% CY2012 CY2013 CY2016P Conversion from visitors to buyers India e-commerce market will start maturing and display characteristics similar to China which traditionally has higher conversion rates (nearly 3.5%) This is due to e-commerce being only choice for availability of goods in parts of the country and easy payment options like COD which are not problems in western countries Accel estimates, Accel portfolio companies, comScore & IAMAI
  • Growth of India online shopping 14 Market Trends Growth Factors Payments BRICS 140 M 213 M 400 M CY2012 CY2013 CY2016P Internet users in India % of internet users who visit e- commerce sites = 60% As e-commerce sites gain trust, users are beginning to order more frequently Also, repeat users acquired more than 1yr old - are more comfortable ordering online and order significantly more than first time buyers 4M 5M 12M CY2012 CY2013 CY2016P # of orders per month 3.00% 2.70% 2.90% CY2012 CY2013 CY2016P Conversion from visitors to buyers 1.50 1.55 1.70 CY2012 CY2013 CY2016P Orders per buyer per month India e-commerce market will start maturing and display characteristics similar to China which traditionally has higher conversion rates (nearly 3.5%) This is due to e-commerce being only choice for availability of goods in parts of the country and easy payment options like COD which are not problems in western countries Accel estimates, Accel portfolio companies, comScore & IAMAI
  • Growth of India online shopping 15 Market Trends Growth Factors Payments BRICS 140 M 213 M 400 M CY2012 CY2013 CY2016P Internet users in India % of internet users who visit e- commerce sites = 60% Last year there was a significant jump in average order value as there was a penetration of new categories like jewellery, home dcor etc Also, users are becoming more comfortable buying higher priced items online 4M 5M 12M CY2012 CY2013 CY2016P # of orders per month 3.00% 2.70% 2.90% CY2012 CY2013 CY2016P Conversion from visitors to buyers 1.50 1.55 1.70 CY2012 CY2013 CY2016P Orders per buyer per month $18 $31 $60 CY2012 CY2013 CY2016P Average order value Accel estimates, Accel portfolio companies, comScore & IAMAI
  • Growth of India online shopping 16 Market Trends Growth Factors Payments BRICS 140 M 213 M 400 M CY2012 CY2013 CY2016P Internet users in India % of internet users who visit e- commerce sites = 60% Last year there was a significant jump in average order value as there was a penetration of new categories like jewellery, home dcor etc Also, users are becoming more comfortable buying higher priced items online 4M 5M 12M CY2012 CY2013 CY2016P # of orders per month 3.00% 2.70% 2.90% CY2012 CY2013 CY2016P Conversion from visitors to buyers 1.50 1.55 1.70 CY2012 CY2013 CY2016P Orders per buyer per month $18 $31 $60 CY2012 CY2013 CY2016P Average order value $816 M $1,983 M $8,519 M CY2012 CY2013 CY2016P Annualized online shopping GMV Accel estimates, Accel portfolio companies, comScore & IAMAI
  • Other observations 17 Market Trends Growth Factors Payments BRICS 1. ~200M of Indians will come online in next 3 years 2. Majority of these will come online on smartphones 3. E-Commerce companies are building their brands, thus gaining trust of users 1. Existing shoppers shop more n