India’s e-commerce boom: Gross value jumps 140% in 3 years

India’s e-commerce market is on fire! With consumers rapidly adopting online shopping and renewed thrust from leading consumer goods and retail players in the country, gross merchandise value (GMV) of India’s e-tailers touched US$ 60 billion in FY2023.

As per latest data from Redseer Research and Analysis, the surge in e-tailer GMV rose 22 per cent last year over the previous year. In FY2022, GMV of e-tailers stood at $49 billion. 

While COVID related disruptions like lockdown and supply chain bottlenecks impacted economic activities during the past three years, e-commerce sales grew by leaps and bounds. In fact, since the end of FY2020, when the COVID pandemic hit the shores, e-commerce sales have jumped by a whopping 140 per cent. 

In FY2020, while the GMV stood at $25 billion - up by 13.6 per cent over the previous year, in FY2021 e-commerce GMV grew by 44 per cent to reach $36 billion. In the following year, it continued to grow rapidly (by 36.1 per cent) to cross $49 billion in FY2022.

The data, however, shows that the yearly growth rate is slowing since its peak in FY2021, when a stringent lockdown was in place and physical stores were shut for several weeks. “Despite losing momentum, e-tailing today is 2.5 times of pre-COVID levels and is performing much better than overall retail consumption, which has been tepid in the recent quarters due to inflation concerns,” said Mrigank Gutgutia, Partner at Redseer.

According to it, over the last three years new users who are willing to try e-commerce throughout the country have increased and non-metro users account for a large share of the total user base in FY23. “However, the growth pattern in FY23 (and likely going forward as well) is different wherein the ‘regular shoppers’ i.e., the monthly user base is now larger than ever before. Monthly shopper base (MTU) which stood at nearly 65 million in FY23 is now 31 per cent of the annual e-tailing shopper base –the same metric which was just 23 per cent in pre-pandemic era. This goes to show that e-tailing user base is maturing and customers now shop online more frequently across a range of categories,” Redseer noted.

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