Mumbai still needs to overcome several challenges in its e-commerce landscape, notably the limited government support in terms of setting up for regulation, as the current regulation benefits only the Indian conglomerates and seems to hinder MNCs from entering the country. It's reflected by the city's poor score on barriers to entry. Furthermore, the growth of the e-commerce industry does not seem to be well-supported by the logistics, with the country itself still ranked number 44th on World Bank's Logistic Performance Index. In addition, Mumbai still scores poorly on user satisfaction due to poor performing government banks and e-commerce websites which are not user-friendly.
According to our latest report, Top E-commerce Cities in Asia, Mumbai is among top e-commerce cities in Asia, along with other cities, such as Shanghai, Bangkok, Tokyo, and many more. The report aims to shed light upon the significance of e-commerce landscape in the region and its quick adaptation to global trends. The report defines an "e-commerce city" here as an urban city with interconnected infrastructure that makes up an e-commerce ecosystem that helps it thrive.
Nevertheless, the government's digital initiative has been a key factor in enhancing internet penetration across the country, leading to a whole host of services being digitally delivered. Domestic high demand and consumption is the obvious driver to play out in the e-commerce. With the largest English-speaking middle-class population, English language in e-commerce portals plays a big role in the e-commerce growth along with the local languages in India.
E-commerce, being one of the most significant sectors in this industry 4.0 era, has also grown rapidly for the past couple of years in Mumbai. The city of 21.3 million people with 72% internet penetration rate and at the same time boasting the highest number of internet user all across India, has experienced significant growth of approximately 50% from 2013 – 2017, thanks to the adaptability of the players in the industry to serve the customer by providing cash-on-delivery payment method in the early stage of the development and also increasing e-literacy in the region.
With an astounding USD 2.86 trillion in 2018 and are estimated to grow further to USD 6 trillion in 2022, the e-commerce industry has continued to witness Ascending growth around the world. Furthermore, the Asia Pacific market alone had a 35% economic growth rate in 2018 with USD 1.8 trillion retail e-commerce sales, making the region as a leader to achieve one-fourth of global e-commerce share by 2023, according to our studies.
Mumbai and other global cities can improve their e-commerce ecosystem by learning from the provided recommended framework in the report, consisting of 5 key building blocks for startup ecosystem to reach its full potential. This encompasses: stable and predictable regulatory environments; market readiness and robust infrastructure; adequate talent; funding to scale up the business, as well as global culture to empower innovative ideas.
Download the full report on Top E-Commerce Cities in Asia.