Not just discounts, but Indians are buying online for convenience as well [Report]

Online product discovery and price comparison 5X bigger than ecommerce in India. 36% online Indians prefer online research before buying

While online shopping has been picking up slowly in India, web’s influence on buying decisions is growing rapidly. The influence affects up to five times more purchases than those that actually happen online, according to a new study conducted by Boston Consulting Group.

India Online Buying Behavior across categories
India Online Buying Behavior across categories

Currently over 36 million urban population in India do product research/discovery and comparison before making actual purchase. Further digital medium is set to affect more people as the report expects 330 million Internet users in the country by 2016.

The growing digital influence is particularly prevalent in categories such as appliances and consumer electronics, in which 40 to 60% of buyers have access to the Internet, and more than a third of them rely on the Internet for product research or price comparison.

Unlike smartphone uses where women rub shoulders with men, Indian men are far more likely than women to be on the Internet (32 percent versus 12 percent) and more than three times likely to be digitally influenced (14 percent versus 4 percent), reveals report.

Why Indians are buying Online?

If you think discount drives ecommerce in India – think once again – 37 percent surveyed respondents valued convenience of shopping from home against 30 percent driven for discounts (a different perspective: Why Indians do not buy online).

Wider product assortments (options) draw 29 percent respondents buying online.

“Of India’s 90 million urban Internet users, 40 percent report that their online activities influence what they buy. Put in terms of financial impact, this digital influence affects $30 billion of consumer spending in India today, as much as five times that of e-commerce alone. With growing access and use, this digital impact is expected to grow fivefold to $150 billion by 2016—more than the combined revenues of the major retail chains (estimated at $106 billion) and 20 percent of the total retail market (estimated at $799 billion)”

Digital Buzz India Report

Nearly half of online Indians are in the age bracket of 18-24 and least among those are people older than 54.

The BCG report is based on a survey of 25,000 Indian consumers on their online activities during each step of the purchase cycle across 101 product categories.

On the basis of the findings, BCG assigned each product category a Digital Intensity Index (DII).  Direct home TV topped the list of DII followed by air travel (primarily OTAs), PC and mobile accessories.

Auto category has one of the lowest DIIs. Product categories with the highest DII have the most online activity at different stages of the purchase cycle, including the pre-purchase and post-purchase stages. Air travel, with the second-highest digital intensity, has a DII of only 20.6 out of 100, which essentially implies the huge gap and opportunities lie for startups to engage consumers online and influence their buying decisions.

With growing digital influence in India, the study outlines the need for consumer products companies to integrate their online and offline strategies, engage consumers and build their loyalty, and importantly mind the gaps in which online activity is low, and optimize the mobile experience.

Unlike advanced e-commerce markets, digitally influenced consumers in India rely on company websites for detailed product information as compared to third-party sites for comparative research and purchases.

– Report link.

– Before you believe any survey, read how to read a survey report.

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