E-commerce: Powered by Internet surge, online shopping touches new heights in India in 2012

Source: The India Express

People turned to the Internet to buy everything from diapers to books, houses and even groceries this year, pushing e-commerce revenues in the country to USD 14 billion with the possibility of even higher earnings in 2013.

Factors like spiralling inflation and slower economic growth failed to dampen the online shopping frenzy as more and more companies opted for selling wares through the internet route, offering innumerable options and discounts to buyers.

"Increasing Internet penetration and availability of more payment options boosted the e-commerce industry in 2012.

Indian E-commerce Company Myntra Acquires The Gilt For Indian Fashion, Exclusively.In

Source: TechCrunch



Myntra, one of India’s largest ecommerce players for fashion, has acquired Exclusively.In, a members-only niche flash sales site for fashion, jewelry and home decor from Indian artisans and designers. Financial terms of the deal, which consists of cash and equity, were not disclosed. Exclusively.In had raised $18.6 million in funding from Tiger Global Management, Accel Partners India, Helion Venture Partners and others.

Why inventory-led e-commerce companies in India will not be profitable… EVER

Source: VCCircle

The entire Indian e-commerce biz, excluding online travel, is at least 8-10 years away from the scale, where inventory-led model may turn profitable.

While more than $350 million have been invested in Indian e-commerce over the past three years, a majority of the capital has gone into only one kind of e-commerce business model, i.e., inventory-led e-commerce models. The inventory led e-commerce models have almost the same economic characteristics as the traditional brick-and-mortar model when it comes to inventory risk exposure, warehousing, and sourcing. Even at an approximately $65 billion in gross merchandise value (excluding Kindle, AWS and digital downloads) in 2011, Amazon did not produce more than 0.25 per cent in operating margin from Amazon.com. The entire Indian e-commerce (excluding online travel) is around $550 million and is, at least, 8-10 years away from the scale, where inventory-led model may even turn profitable.