Small-town India fuels rise of online shopping

UTRECHT - A new report by the Boston Consulting Group says online retail in India could be a $84-billion industry by 2016 --more than ten times its worth in 2010 -- and will account for 4.5 percent of total retail. E-commerce entrepreneurs and experts say small-town India will play a big role in the online bonanza.

Balendu Shrivastava, Group Business Director, Internet & Mobile Association of India, says more than 60 percent of online shoppers would come from beyond the top 8 metros by the end of 2012.

Easy access

Organized retail is hardly a pan-India phenomenon and large chains make up less than 10 percent of the market. As a result, smaller towns often don't have access to the merchandise available in metros such as Bangalore or Mumbai. Internet and online retail sites have emerged as the great leveller. India has become the third-largest Internet market, based on the total number of users, and 60 percent of these come from smaller towns.

"Internet penetration ... has allowed online consumers to actually get access to the same selection, pricing, discount and deals, that so far was available to their cousins in larger cities," says K. Vaitheeswaran, CEO of

Besides books, online shoppers in India buy ...

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