The impact on the Indian industry

E-commerce has become a first-class distribution channel worldwide: home reclusion and the stop of activities for retail stores during the COVID19 pandemic have accelerated transformation in distribution channels. Such a revolution is more visible in developing countries, such as India.
Even before the pandemic, the country was a super-power among international markets, thanks to its demographic growth and improved living conditions. During the pandemic, the digitalization in the country and the increasing internet and smartphone penetration changed people’s habits. Due to distancing restrictions, e-commerce and online platforms have become the first choice for purchase.

The Italian Trade Agency office in India recently published a market report focusing on e-commerce in India. The online retail market covers 25% of the total organized retail market in India, and the percentage is expected to grow up to 37% by 2030. By 2034, India is predicted to surpass the United States and become the second largest e-commerce market worldwide. Beauty products cover 36% of the value, with the most outstanding performances registered by personal care and beauty and wellness products.
E-commerce is leading to positive effects on society: the growing purchase percentages by all generations, as well as in rural areas, are pushing companies to invest in digitalization, quality standards, and logistics. The direct consequence is a boost in employment and new professional profiles and an increase in export and branding for the Indian beauty industry. The local government is actively promoting digitalization and e-commerce services, delivering specific regulations to protect online consumers and grant loyal concurrency. Besides big multinational companies, new local platforms and start-ups are being launched on the market, providing multiple choices for consumers and brands.

The Italian Trade Agency is entering e-commerce to find new tools for promoting Made in Italy in India. Together with the Italian Ministry of Foreign Affairs and International Cooperation, the ITA agency in India created The Italian Mall project, a progressive marketplace for authentic Italian products hosted by one of the leading e-commerce websites in the country, Flipkart. “To enhance trade opportunities between Italy and India, the Italian Mall is created to simplify the cross-border shopping experience. It also helps break geographical barriers and is strategically aligned with the welfare of its audience and consumers”, said Mr. Fabrizio Giustarini, Trade Commissioner of ICE Mumbai.
Launched in January this year, the Italian Mall currently hosts around 50 brands and 800 products to the Indian consumer, with beauty generating more than 50% of its value. The marketplace is meant to be a stage for products representing the excellence, high quality, and creativity of Italian brands, nourishing the Indian consumers’ taste for Made in Italy products and providing them with an immediate digital interface.

E-commerce and digital tools will remain an integral part of consumers’ habits even in the months to come, leading to omnichannel retail experiences and innovative customer services. The most revolutionary transformations are still to come.

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