As per the report, the growth pattern in FY23 is different wherein the ‘regular shoppers’ i.e., the monthly user base is larger

E-tailing in India is gaining popularity with the increased proliferation of smartphones and the internet. D2C brand growth has also spurred traditional players to take the digital route offering a competitive shopping experience and encouraging consumers to shop online.

“The e-tailing market in India has been slowing since the pandemic to grow gross merchandise value at 22% in FY23 to reach $60 billion. 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 recent quarters due to inflation concerns,” said Mrigank Gutgutia, partner, Redseer.

As per the report, the growth pattern in FY23 is different wherein the ‘regular shoppers’ (the monthly user base) is larger. The monthly shopper base (MTU) which stood at approximately 65 million in FY23 is 31% of the annual e-tailing shopper base –the same metric which was 23% in the pre-pandemic era.

In contrast to the pre-covid levels, the e-tailing market has grown deeper across categories, with more users making purchases online. Although mobile phones dominated the category divide in FY19, fashion is the single largest category with a 27% share whereas beauty and personal care, grocery and home categories are the fastest growing.

“Strategic partnerships of e-commerce platforms with global and Indian brands along with a change in shopper mix and an increasing share of women shoppers has resulted in an explosion of fashion sales,” Mrigank Gutgutia added. With 1.2 times better take rates, the revenue from product sales across India e-tailing has grown three times from $2 billion in FY19 to $6 billion in FY23.

Advertisement revenue has been another facet of e-tailing that has experienced steep growth, with ad monetization generating more than $1.2 billion in FY23. Increasing MTUs has widened the reach of e-commerce platforms, making them attractive for brands. First-party customer data enables better ad placements for advertisers and show the product to high-intent customers leading to higher conversion rates.

“Ad revenue is growing significantly faster than the overall digital ads market reaching a 15% share of the digital ads market in FY23. Global platforms have more than 3% of fulfilled gross merchandise value coming from ads business, and the Indian market can grow much further.” the report concludes.

According to the report, the Flipkart group has been resilient in terms of market share in the last few years despite growing competition while growing faster than the industry in recent quarters” the report added.

The e-commerce giant’s group market share stood steady at 48% in FY23 and has resiliently withstood competition from other incumbents owing to a large selection, varied affordability constructs and a strong understanding of the needs of the vast e-tailing shopper base in India including those from tier-II cities.

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.

https://www.financialexpress.com/business/brandwagon-india-e-tailing-reached-60-billion-gmv-in-fy23-with-22-annual-growth-redseer-report-3092348/