Despite Covid-19 slump, Indians are spending more on e-commerce — India

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E-commerce may have plunged into a coma of sorts when India’s coronavirus lockdown started at the end of March, but five months later it’s back with a bang.

In May, June, and July, Indians spent more on shopping online than they did in the same period a year ago months, according to market intelligence firm Kalagato. The sale of non-essential items being permitted in designated “orange” and “green” zones—areas that were not Covid-19 hotbeds—is one of the reasons for the uptick.

“An unintended consequence of the lockdowns is that (e-commerce) adoption has increased. People were forced to learn new ways of conducting business, getting essentials, and entertaining themselves,” Kalagato co-founder and business head Aman Kumar said. “The pent-up demand is plain to see.”

Even as the country opens up bit by bit, shoppers’ habits have changed. Footfalls are falling at malls and shopping centres, and shoppers are spending lesser time at these places. In contrast, e-commerce is booming. Amazon India’s paid customer base, for instance, has more than doubled amid the pandemic.

However, there’s still a long road ahead to transform India into an e-commerce-first nation.

“While the data may indicate a return to pre-Covid levels, it’s premature to call this a recovery,” said Kumar. Spending values don’t indicate spending volume. Each person may be spending more but the total number of shoppers could still be low. After all, just 1.6% of the total retail in India is online.

In the short term, though, the bumper sales will continue since India’s festive season is just around the corner.

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