eCommerce in India 2018-11-03

The Rural market for e-commerce in India to be US$10-12 Billion opportunities by 2021: EY Reports

The total e-commerce sales may likely to grow at 32% compounded annual growth rate CAGR from 2017 to 2021.

By Senior Sub-editor
The Rural market for e-commerce in India to be US$10-12 Billion opportunities by 2021: EY Reports

 

It is estimated that the rural e–tail market is capable to present US $10b-US $12billion opportunity for e-commerce firms in the next four years. This can be attributed to the rising household incomes leading to an increase in consumption expenditure, diversified income sources from non-agricultural activities, positive agricultural outlook, increase in internet penetration, high propensity to spend and rising number of nuclear families in rural India, according to a new EY report, Rural e-commerce: The untapped potential.

The report states that demand in rural India is geography specific and would require considerable localization. Further, while rural customers are aspirational and desire to own branded products, they also price sensitive. Hence, companies need to create the right balance in their product mix comprising both value-for-money, unbranded items and branded products, which cater to their aspirations.

The report also highlights that to gain traction in the rural markets, companies would be required to rethink their business models and focus on demand generation, supply and services innovation.

Here is what the companies should do:

  • Offer an easy line of credit by partnering with financial organizations that help with micro-lending will enable spending both from businesses and rural customers.
  • Leverage on existing social structure and infrastructure to create awareness and trust among the customers.
  • Ensure product curation and rationalization across geographies while identifying the right category–product mix with the share of unbranded, branded goods and comparable private labels, which would help improve the unit economics of serving to the rural customers.

Experts Note

Ankur Pahwa, Partner and National Leader – E-Commerce and Consumer Internet, EY India, says, “Rural online retail opportunity is clear and present for aspirational rural India; however, success will come for e-commerce companies that continuously innovate to engage consumers, especially with those users who are online but are not transacting on the internet or are limited to only using online channels for availing specific services only.  E-commerce companies will need to innovate on distributed logistics, building trust with aspirational rural consumers and providing them with right category-product-mix through product curation and rationalization.”

Comment
image
image
mobile
address
star franchise india
Related opportunities
  • Quick Service Restaurants
    Delhi’s favourite chain of fusion cafes for takeaway, Hashtag Pizza..
    Locations looking for expansion Haryana
    Establishment year 2019
    Franchising Launch Date 2021
    Investment size Rs. 5lac - 10lac
    Space required 150
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Faridabad Haryana
  • About Us: Puchkaman ®, a Unit of Grunmorsus Foods & Beverages..
    Locations looking for expansion West bengal
    Establishment year 2018
    Franchising Launch Date 2019
    Investment size Rs. 5lac - 10lac
    Space required 150
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Kolkata West bengal
  • Others Food Service
    About Us: Happy Moments was founded in 2016. The partners of..
    Locations looking for expansion Maharashtra
    Establishment year 2016
    Franchising Launch Date 2019
    Investment size Rs. 10lac - 20lac
    Space required 300
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Kandivali west Maharashtra
  • Furniture For Household Bed, Modular Kitchen
    Waltzer India Pvt Ltd is a company dedicated to innovate,..
    Locations looking for expansion Madhya pradesh
    Establishment year 1999
    Franchising Launch Date 2008
    Investment size
    Space required 99
    Franchise Outlets -NA-
    Franchise Type -NA-
    Headquater Indore Madhya pradesh
Insta-Subscribe to
The Franchising World
Magazine
tfw-80x109
For hassle free instant subscription, just give your number and email id and our customer care agent will get in touch with you
email
mobile
OR Click here to Subscribe Online
Daily Updates
Submit your email address to receive the latest updates on news & host of opportunities
More Stories

Free Advice - Ask Our Experts

pincode
;
ads ads ads ads