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India’s E-retailing reached $60 billion GMV in FY2023 with a steady 22% annual growth: Redseer Strategy Consultants

E-retailing, which experienced a steep growth during the Covid times, has slowly been losing momentum post-pandemic. However, the growth rate continues to remain healthy, according to the report by Redseer Strategy Consultants

E-tailing in India is gaining popularity with the increased proliferation of smartphones and the internet. With this, India’s E-retailing reached $60 billion GMV in FY2023 with a steady 22% annual growth, as per a report by Redseer Strategy Consultants.

Online retailer’s relevant and affordable supply along with standardised experience on the platforms, make eCommerce attractive to shoppers.

D2C brand growth has also spurred traditional players to take the digital route offering a competitive shopping experience and encouraging consumers to shop online.

Key takeaways from the report are:

  • Despite slower annual growth of 22% in FY23, e-tailing today is 2.5x of pre-COVID levels.
  • Shopper base is maturing- 31% of annual shoppers are now monthly shoppers as well, well up from 23% in FY21.
  • Maturing user base is driving 1.2x better monetization owing to changed category mix - with fashion now the largest online category with 27% GMV share.
  •  With 210 million annual shoppers in FY23, ads monetisation contributed $1.2 billion in revenue for Indian e-tailers in FY23 and is growing at 37% y-o-y- will drive strong growth going forward as well.
  • Flipkart Group has been resilient and maintained its market share at 48% in FY23 despite growing competition in recently-and is especially growing 1.6x faster than industry in JFM23 quarters


“The e-tailing market in India has been slowing since the pandemic to grow GMV at 22% in FY23 to reach $60 billion”, according to Mrigank Gutgutia, Partner at Redseer. He further added, “Despite losing momentum, e-tailing today is 2.5x of pre-COVID levels and is performing much better than overall retail consumption, which has been tepid in the recent quarters due to inflation concerns”

Over the last three years new users who are willing to try eCommerce throughout the country have increased and non-metro users account for a large share of the total user base in FY23.  

However, the growth pattern in FY23 (and likely going forward as well) is different wherein the ‘regular shoppers’ I.e., the monthly user base is now larger than ever before.

Monthly shopper base (MTU) which stood at 65 million in FY23 is now 31% of the annual e-tailing shopper base –the same metric which was just 23% in pre-pandemic era. This goes to show that e-tailing user base is maturing and customers now shop online more frequently across a range of categories.  

In contrast to the pre-Covid levels 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 now the single largest category with 27% share whereas BPC, 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,” Gutgutia added. With 1.2x better take rates, the revenue from product sales across India e-tailing has grown 3x from $2 billion in FY 2019 to $6 billion in FY 23.

Advertisement revenue has been another facet of e-tailing that has also experienced a steep growth, with ad monetisation generating more than $1.2 billion in FY23. Increasing MTUs has widened the reach of e-commerce platforms, making them attractive for brands. 1P 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 GMV coming from ads business, and the Indian market can grow much further,” the report concludes. 

 “Flipkart Group has been resilient in terms of market share in the last few years despite growing competition - and is especially growing much faster than industry in recent quarters” the report added. The ecommerce 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 strong understanding of needs of the vast e-tailing shopper base in India including those from T2+ cities.

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