The apps are available for various needs: an extra mango, a carton of milk, a pint of ice cream, or a replacement phone cable for the one your dog chewed in half. In India, whether you live in urban centers or smaller cities and towns, you can have almost anything delivered at the touch of a button, sometimes within 10 minutes. Online shopping, or e-commerce, is rapidly changing the way India shops, especially through quick commerce apps that deliver groceries and essentials to your door quickly and at a low cost.
While e-commerce currently accounts for only 6% of India’s $900 billion retail market, it is one of the fastest-growing markets in the world. In 2022, 200 million people in India made online purchases, a significant increase compared to just a few years ago when the number was less than a million. However, companies and analysts believe these numbers only scratch the surface. They predict that by 2027, the number of online shoppers will rise to 500 million in a market worth $170 billion.
Some believe that these innovations could make India a global leader in new ways of doing business online. However, there are concerns that the rise of e-commerce could lead to large businesses gaining monopolies over retail, potentially harming the traditional marketplace. Additionally, the growth of e-commerce has been fueled by the exploitation of India’s gig workforce.
Despite the rapid growth of e-commerce, Indian shopping habits have remained relatively unchanged for decades. Unlike in the West, where large supermarket chains dominate, Indians still predominantly buy fresh produce from local markets and vegetables sellers. Other essentials are often purchased from neighborhood shops known as kiranas. While big-name fashion brands are popular, many people still prefer to buy their clothes from locally run shops and markets, especially those outside urban areas.
For the past decade, the e-commerce sector in India has been dominated by two companies, Flipkart and Amazon. Together, they account for about 75% of the online shopping market and are also the largest players in the overall commerce market in the country. However, the e-commerce landscape is rapidly changing as India’s economy continues to grow. Numerous companies, such as Swiggy, Zomato, Big Basket, Zepto, Meesho, Blinkit, Nykaa, and Dunzo, have become ubiquitous, delivering various products beyond just groceries and restaurants in both urban centers and smaller cities.
While a significant portion of Indians still earn less than £250 a month, e-commerce companies have observed considerable growth in smaller cities, indicating that online shopping is no longer limited to the urban elite. The increase in affordability and access to cheap internet has played a vital role in this growth. By 2025, it is expected that 1 billion Indians will have access to the internet, with 33% of them becoming online shoppers.
The COVID-19 pandemic has further accelerated the shift to online shopping. Lockdowns forced people to try online grocery shopping for the first time, while traditional sellers had to embrace digital platforms to survive. As a result, many new e-commerce enterprises emerged to meet the sudden demand.
Another significant development is the rise of digital payment systems. India has transitioned from a predominantly cash-based society to a system where millions of Indians have bank accounts linked to apps with the Unified Payments Interface (UPI). This has made paying for goods purchased online much easier and more convenient.
However, while e-commerce platforms have provided employment opportunities for millions of gig workers, there is a lack of legal protection for these workers. Exploitation and abuse are common, with gig workers facing low wages, harassment, violence, and poor working conditions. The situation worsened as competition increased and growth slowed, leading e-commerce companies to implement cost-cutting measures that directly affected gig workers. Incidents of violence and assault against these workers have been reported. Workers have gone on strike to protest against unfair treatment and poor conditions.
In summary, e-commerce is transforming the way Indians shop, with quick commerce apps providing fast and convenient delivery of groceries and essentials. The market is rapidly growing, and more Indians are expected to embrace online shopping in the coming years. However, there are concerns about the impact on traditional retail and the welfare of gig workers.