Ecommerce has given a new dimension to economic growth and added more value to business and customers. I believe after the Industrial revolution the biggest development seen in the business world is the emergence of e-commerce which will revolutionize economic growth. The world is witnessing a digital revolution involving the internet and the use of websites all around the world has set the stage for e-commerce. Essentially this new economy is the digital economy that offers the most important facilities, the capacity to make transactions beyond the border, time, and space.
Ecommerce has enormous growth potential and is going to be the driving force of economic development. It is important to understand the true potential of e-commerce if we want to see structural change in our economy. Ecommerce has been there for the last two decades in some other form, be it fax, telephone, Tv, Electronic payment, electronic data interchange, money transfer system, etc. But the spread of the Internet has become the new forcer popularizing it. The internet provides access twenty-four hours a day, seven days a week, anytime anywhere. Therefore, time and place are no longer a constraint.
Though E-commerce is built on the traditional business structure but offers the flexibility of electronic networks that led to improvement in operations and as a result substantial cost saving as well as increasing competitiveness and efficiency through redesigning of traditional business.
Recently we have witnessed many countries attaining a higher level of development. The reason behind this massive development is E-commerce, as it has given a new dimension to economic growth thereby creating a conducive environment for further development.
Ecommerce and Economic growth in India
Acceleration In Demand
India’s e-commerce order volume increased by 36% in the last quarter, with the personal care, beauty, and wellness segment being the largest beneficiary. India’s e-commerce market is expected to reach US$ 111 billion by 2024 and US$ 200 by 2026.
Despite gloomy consumer spending, economic slowdown, and uncertainty created due to Covid 19, e-commerce players are expecting strong sales growth. India’s e-commerce market is expected to reach US$ 350 billion by 2030.
100% Foreign Direct Investment is allowed in B2B eCommerce. Another advantage is 100% FDI under the automatic route is permitted in the market model of e-commerce. Since 2014, the Government of India has announced various initiatives, namely Digital India, Make in India, Start-up India, Skill India, and Innovation Fund. The timely and effective implementation of such programs will likely support the growth of E-commerce in the country.
The recent rise in digital literacy has led to an influx of investment in e-commerce firms, leveling the market for new players to set up their base, while churning out innovative patterns to disrupt old functioning. Huge investments from global players—such as Facebook, which is investing in Reliance Jio—are being recorded in the e-commerce market. Google also reported its first investment worth US$ 4.5 billion in Jio Platforms. This deal was followed by the purchase of Future Group by Reliance Retail, expanding the presence of the Ambani Group in the e-commerce space.
Change in Buying behavior
Earlier when customers wanted to buy anything they used to set aside time to shop during certain hours of the day or had to go through catalogs but today customers can simply use their computers and now smartphones to shop online. They are no longer restricted by store hours, geographic marketing areas, or catalogs mailing lists. Just with simple clicks, they can gain access to a variety of goods at any time of the day. Consumes have developed trust and have changed their attitude towards online shopping. The convenience of a variety of digital payment options, convenient return policy, and security have affected consumer behavior to a great extent.
According to reports the Indian e-commerce industry has been on an upward trajectory and is expected to surpass the US to become the second-largest e-commerce market in the world by 2034. The growth in the E-commerce sector will also boost employment, increase revenues from export, increase tax collection by exchequers, and provide better products and services to customers in the long-term which in turn will see rapid growth in the economy.
Pic Courtesy : Pexel/Canva
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