Buzzing Chandigarh :Currently in India, there are about 460 million people with access to the Internet. This alone makes their online market one of the largest in the world. But, this population of online users is expected to see an enormous spike over the next few years. As the Internet becomes more affordable and spreads into the more rural areas of India, the online population will grow to over than 650 million people. This means there will be more online users in India than there are residents of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States put together.
Statistics show that from the current online population, there’s a relatively small number of people who are actually making transactions through the web – but that will all be changing rather soon.
Morgan Stanley reports that users with less than two years online experience are less likely to make online transactions compared to those with five years experience. The data concludes that people need time to become comfortable online before making actual purchases via the web. It’s estimated that by 2026, the amount of people shopping online will rise to over 50% of the country’s online population. Executive director at Morgan Stanley Parag Gupta explains the prediction:“A bulk of the addition in the Internet base has happened in the last three years. That’s when smartphone penetration started ballooning. So a large base of the internet population has been on the internet for not as many years as required to get comfortable with the medium. When does that maturity come through? Most likely 2019.”
This means that over the next few years, we can expect to see an estimated 230 million new users who are ready to conduct online transactions. Making India one of today’s hottest E-commerce investment opportunities. Quantified Commerce has already started building direct-to-consumer vertically integrated brands in the last five years to cater to this rising group of Internet users. But, what will they be buying?
According to a report from Google and the Boston Consulting Group, the current highest selling online products are consumer electronics and apparel. But, beauty and wellness are the fastest growing within the market.
“Consumers are going to eventually be buying everything online,” said Ryan Andreas, co-founder of Quantified Commerce, “And vertical integration gives us an advantage over non-vertically integrated companies because we own every step of the supply chain.”
As the market for these products grows so does the potential for visionary companies like Quantified Commerce, which has been growing at a rate of 100-300% in the last 4-5 years in India.
So what does all this mean for existing companies? New companies?
Brands would be wise to find innovative ways to advertise on this new marketplace. Glossier for example, is one of the largest makeup brands in the US and they owe 90% of their revenue to their Instagram following. Bain Consulting found that 67% of consumers will use a company’s social media channel for customer support. They also discovered that customers who receive a response from a company via social media end up spending 20%-40% more money with them. Concluding that consumers are more prone to buying products from a brand that they recognize and connect with daily.
Brands, like those built by companies like Quantified Commerce, have a unique advantage on the rising market as their products are already just that … unique. An online ecosystem means that stakes are higher because your competition is just a click away. By creating a product and user experience that’s vertically integrated, these kinds of companies eliminate the issue of consumers who are obsessed with things like ‘price matching.’ They know they’re getting the best possible price with Quantified Commerce.
As India’s online population continues to increase at exponential rates, the potential for these new brands grows at the same rate. These new users will soon be more comfortable making online transactions and as a result become an essentially untouched consumer group.