India’s e-retail sector is poised for significant expansion, with gross merchandise value (GMV) projected to reach $170–$190 billion by 2030, according to a report by Bain & Company and Flipkart. While the market currently stands at $60 billion, growth has temporarily slowed to 10–12 per cent in 2024 due to macroeconomic pressures and subdued discretionary spending.
However, the report forecasts an acceleration in the coming years, with annual growth exceeding 18 per cent as India’s per capita GDP crosses the $3,500–$4,000 mark—an inflection point historically linked with e-commerce surges globally.
Grocery, Lifestyle and General Merchandise to Drive 70% of Growth
Categories with high purchase frequency, such as grocery, lifestyle, and general merchandise, are expected to contribute nearly 70 per cent of incremental e-retail growth by 2030. Penetration in these segments is likely to rise two to four times, driven by affordability, wider assortment, and logistics expansion.
Quick Commerce Set for Explosive Expansion
Quick commerce (Q-commerce) has already carved a substantial space, contributing 10 per cent of overall e-retail GMV and dominating 70–75 per cent of e-grocery sales. According to the report, Q-commerce is projected to grow at over 40 per cent annually through 2030. The business model has achieved improved margins through higher average order values and streamlined logistics.
Smaller Cities Fueling Digital Retail Boom
Since 2020, Tier-III and smaller towns have contributed 60 per cent of new online shoppers and 45 per cent of order volumes. The seller ecosystem is also evolving, with 60 per cent of merchants onboarded since 2021 based in Tier-II and below regions. This trend reflects the increasing digital participation of underserved markets in the e-commerce economy.
Rise of Trend-First and Hyper-Value Commerce
Trend-first commerce, led by fast fashion and youth-focused categories, is expected to drive major gains in online penetration. Fashion alone is anticipated to cross 50 per cent online penetration by 2028, with a market value between $8–$10 billion. The trend is also extending into beauty, electronics, and travel accessories.
Meanwhile, hyper-value commerce catering to budget-conscious consumers has grown its share from 5 per cent in 2021 to around 12–15 per cent in 2024. This model is gaining traction in non-metro regions where affordability and assortment drive adoption.
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Gen Z Shaping Future E-Retail Trends
Generation Z shoppers now represent 40 per cent of India’s online retail base. The cohort is reshaping consumption patterns with faster decision-making, preference for UPI transactions, and high engagement with new-age fashion brands. Social media remains a major source of product discovery, influencing purchasing behaviours significantly.
Outlook: A Diverse and Expanding Market
The report concludes that the rise of Q-commerce, trend-first models, and hyper-value platforms is reshaping India’s e-retail ecosystem. MSMEs and national brands alike have growing opportunities to engage consumers across urban and rural markets. Broader access, improved logistics, and customer-centric innovations will continue driving growth as India’s digital economy matures.
