Market Research & Feasibility Study Services for India’s Growing E-commerce Businesses

India is one of the biggest digital marketplaces in the world after China and the USA. The rise of India’s digital economy is rooted in multiple factors, including pandemic growth, a surge in smartphone & internet penetration, rapid adoption of digital payments, spurred urbanization, and transforming consumer behavior. Other macroeconomic fundamentals such as a rise in disposable income, increased liquidity, active participation of millennials in the consumer marketplace, and favorable government policies have helped the digital economy grow fast.

As per the India Brand Equity Forum, by 2023, internet penetration in India reached ~900 million. Out of this, metropolitan regions constitute 55% of subscriptions, while the remaining is led by semi-urban and rural set-ups. Meanwhile, mobile internet subscription is set to cross 1.1 billion by 2025. Expansive digitization offers a natural impetus to the digital economy and e-commerce. To tap into this growing market, businesses are increasingly focusing on market research for retail business in India, ensuring that strategies align with evolving consumer trends and digital adoption.

India’s digital economy is set to touch USD 1 trillion by 2030, out of which the e-commerce segment will be valued at around ~USD 350 billion. If we talk about the e-retail segment, it is slated to reach USD 221 billion. Interestingly, 60% of e-commerce activities are coming from tier-2 cities, smaller towns, and semi-urban set-ups. This shift highlights the importance of market research for retail business in India to understand the purchasing behavior of consumers across different regions.

India’s E-commerce Market Landscape & Trends

India’s e-commerce market has witnessed whopping growth since 2019. The segment grew at a CAGR of 21.1%, reaching USD 188 billion by 2025. The market is driven by factors like urbanization, booming internet penetration, a growing tech-savvy population, and various government initiatives. As a result, the market is expected to grow at a CAGR of 13.2% in the next five years, reaching USD 350 billion by 2030. With a significant increase in online transactions, the e-commerce sector of India has been expanding into tier-2 and tier-3 cities as well. The growth of digital payments across the country has enabled the wider adoption of the e-commerce landscape.

Smartphones and consumer electronics collectively accounted for more than 50% of the total revenue generated by the e-commerce segment. The GOI has permitted 100% FDI in B2B e-commerce to facilitate trade between manufacturers such as manufacturers, wholesalers, and retailers through online channels.

India’s E-Grocery Growing at a Scorching Pace

India’s e-grocery held a minuscule share in the overall grocery retail till 2019. However, during the time of lockdown and social isolation, there was a spike in demand, giving prominence to players such as Grofers (later on it became Blinkit), Big Basket, etc. Horizontal e-commerce giants such as Flipkart and Amazon also entered the grocery segment through Flipkart Supermart and Amazon Fresh. The online grocery market size of the country was USD 30.65 billion in 2024, growing at a CAGR of 29.1% since 2021.

Today, e-grocery is a major player in India’s digital retail ecosystem. Though total e-grocery penetration is still moderate at 2-3% (compare this with China, where it stands at 19%), the segment is set to grow fast. Besides metros, e-grocery is also expanding into semi-urban catchments, Tier-2 & 3 cities, and beyond. To effectively tap into this rapidly evolving sector, businesses are increasingly focusing on market research for e-commerce business in India to understand consumer behavior, optimize logistics, and improve product offerings.

Consumers are understanding the significance of online grocery in terms of convenience, home delivery, availability of multiple options, discount offers, avoidance of crowded marketplaces, and much more. The segment is also getting transformed with the active participation of PE players who are helping incumbent players grow and thrive fast. Increased fund flow has enabled these platforms to invest seamlessly in dark stores, warehouses, effective delivery ecosystems, AI-backed data analytics, and more.

Within the e-grocery space, the concept of Quick Commerce (Q-commerce) is also picking up, with a host of players such as Blinkit (backed by Zomato), Swiggy Instamart, Zepto, and Reliance JioMart, which generally deliver grocery items within 10-30 minutes at the doorstep. It is expected that by 2025, Q-commerce will cross USD 5 billion.

E-Pharmacy has Crossed USD 1 Billion in 2025

The Indian e-pharma sector continues to grow at a staggering pace. Currently, there are close to ~50 players active in the space, almost doubling down from 2021. This also includes participation by major players such as Tata, Reliance, and Flipkart, etc. The overall size of e-pharma has crossed USD 1 billion, jumping up significantly from USD 565 million in 2021.

Both Tata and Reliance have bought stakes in 1 MG and Healthkart, respectively. Other key players in the segment are Apollo Pharmacy, Pharmeasy, Flipkart Health Plus, etc. Players such as Practo, which are largely into e-consultation, are also venturing into the delivery of medicines.

Just like other major e-commerce verticals, it was the lockdown that enabled the digital pharma industry to grow fast in the country. During the time of suspension of physical visits outside, digital pharma helped in seamless last-mile delivery of medicines. However, post-lockdown, the segment continues to thrive due to growing convenience and increased digitization replacing local chemist shops. As the industry expands, businesses are increasingly conducting feasibility study for e-commerce venture to assess profitability, operational efficiency, and regulatory compliance in this competitive space.

Online Food Delivery Systems an Integral Part of Urban Indian Lifestyle

Online food delivery systems have been active in India since the early years of the previous decade. Many platforms emerged at that time (a few became defunct since then), mainly acting as aggregator platforms. Since then, the space has evolved significantly, with online platforms deploying their own delivery infrastructure, rating & feedback mechanisms, discount schemes, and much more. The market has grown at a CAGR of 25.3% in the last five years, reaching USD 11.63 billion in 2024.

Currently, the market is largely duopolistic in nature, dominated by Swiggy and Zomato. Besides, there are a few other players such as Uber Eats, Eat Sure, Magic Pin, Nearby, etc. Like other retail businesses, many individual restaurants, food chains, QSRs, and Cloud Kitchens are also adopting D2C models.

How The India Watch can Help with Feasibility Study Practices 

If you are a start-up enthusiast, high net worth investor, investment & funding agency or any other business entity with an interest in starting an e-commerce business venture, then The India Watch can offer valuable assistance. As a research agency we can help you with tailormade feasibility plans and market studies. Our scope of services include but are not limited to the following 

 

•    Market size of the industry, past trends & future projections

•    Market share analysis

•    Key competition, capacity, USP, growth plans, etc.

•    Major investments, merger & acquisitions, fund raise, etc

•    Major customer segments, needs & wants, market gaps, etc.

•    Customer decision making journey mapping

•    Potential assessment & market scanning

•    Pricing benchmarking & strategy 

•    Go-to market strategy

•    Sales and marketing strategy 

•    Policy & regulatory insights, subsidies, incentives, etc. 

•    Distribution structure analysis  

•    Addressable market size estimation 

•    Financial projection and plan, ROI, ratio analysis, sensitivity analysis, etc. 

•    SWOT analysis

•    Key success factors, growth enablers, risks & challenges

•    Future growth roadmap based on the overall research

For any further query, feel free to drop us a mail at info@theindiawatch.com

 

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