The future of India's E-commerce retail landscape lies at the behest of, none other than, Gen Z shoppers, according to a joint research report published by Deloitte and Google.
The report titled 'The $250 Billion Commerce Frontier' delves into the current status of India's E-commerce space, and projects how things will unfold in the next few years.
According to the report, by 2030, around 22 crore new Gen Z shoppers will contribute 45% of online spend, accelerating digital-first discovery.
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"By 2030, as 150M new shoppers come online and the per capita e-commerce spend doubles, a younger, digital-native cohort of 220M+ Gen Z shoppers will contribute ~45% of online spend, accelerating digital-first discovery and hyper-personalised experiences," the report stated.
However, even as India's online retail market has expanded to $90 billion between 2019 and 2025, the online shopper penetration remains at 30%, "significantly" lower than global peers, as per the report. This, in turn, indicates that there is substantial headroom for growth.
"High GDP growth coupled with low online shopper penetration signal potential for Indian e-commerce," the report underlined.
So far, three key market forces have been responsible for E-commerce expansion in India, namely:
- 11 crore new online Bharat shoppers and a 2.5x uptick in quick commerce
- Doubling of new online sellers and over 600 new D2C brands have opening up new retail categories and value commerce
- Over 40 crore UPI users, vernacular access and more than 19,000+serviceable pin codes.
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Notably, new 'Bharat shoppers' (shoppers in tier 2 cities and beyond), have substantially shifted audience dynamics and shopper demographic.
Tier 2 cities and smaller towns now account for over 60% of online shoppers, about half of e-commerce spendin gand close to three out of every five orders, the report highlighted.
In the coming years, drivers like creator‑led commerce, immersive experiences and tools, instant commerce and reduction in delivery times, and finally, utilisation of Intelligent AI will lead to a boom in the online market space.
These levers will onboard new shoppers, close the imagination gap in online shopping, reshape consumer expectations, create powerful new habit loops and streamline and simplify shopper experience.
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