Railway, air and movie tickets, as well as electronic item sales are boosting e-commerce in Indian metros, according to a study by the Associated Chambers of Commerce and Industry of India. The result could be a 150 percent jump in online revenue to Rs. 5,500 crores in 2007-08 from Rs, 2,200 crores in the year-ago period. According to the report, the percentage of Mumbai’s population that shops online is 24 percent and is expected to touch 40 percent. Delhi follows suit at 20 percent and is likely to go up to 30 percent. Ironically, the percentage of e-shopping population in Bangalore, the Silicon Valley of India, stands at a paltry 6 percent for 2006-07.
While the overall e-commerce growth of 150 percent seems possible because the current base is low, I am a bit sceptical about the jump in the percentage of e-shoppers mentioned in the study. The reports touts gem and jewellery sales as a key driver to online sales growth but I perceive only low-end jewellery being bought online. Buyers will definitely want to touch and feel the diamond necklace they had their eye on before shelling out cash and that would mean a trip to their family jeweller rather than scrolling up and down their computer.