India internet retailing market: 16% CAGR growth expected between 2012-2017

Press Release   •   Jul 18, 2013 14:07 BST and were the leading players in the India internet retailing market in 2012 with 15% and 6% market share respectively. Dell was consistently the market leader since 2004. was among the leading players in 2012 due to its 30 day cash back return policy which attracted a huge consumer base, including those who do not trust internet retailing as it ensured 100% money back guarantee.

Internet retailing companies continued to suffer losses in 2012. In order to reduce these losses the companies put a minimum order price for free shipping in 2012. Flipkart increased the minimum order price for free shipping from Rs200 at the beginning of the year to Rs300 by July 2012. Majority of the internet retailing companies continued to have losses in 2012. The cost of the services provided by these companies such as packaging, free shipping and cash on delivery together outweighed the selling price of an item. As the market was fragmented and the competition high, companies nevertheless continued to provide the services.

2012-2013 will witness more churning and the smaller players will be absorbed by the bigger players thereby making the channel more organised and less fragmented. In terms of specific channels, consumer health, especially for OTC medicines via internet retailing, will witness strong growth in the forecast period. Internet retailers dealing in electronics and appliances, apparel, beauty and personal care will continue to maintain their leading positions in internet retailing.

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