Delhi, Mumbai, Bengaluru continue to be central hubs for online sellers, shows Shiprocket study

Major cities like Delhi, Bengaluru, and Mumbai continue to be central hubs for online sellers, with Delhi alone contributing approximately 6% of total orders in 2023, according to a recent report by the e-commerce enablement platform Shiprocket.

The report, titled “How MSMEs of Bharat Sell Online,” was unveiled at Shiprocket's flagship event, Shiprocket SHIVIR, in New Delhi. It highlights that despite the strong seller presence in urban areas, with Maharashtra leading at 15%, around 71% of orders still come from non-metro regions, showcasing significant growth potential beyond the major cities.

Regionally, Northern India has experienced an increase in orders, with its share rising from 26% in 2021 to 29% in 2023. While the Western region has remained steady, Southern India has seen a decline from 27% to 25%, indicating potential shifts in regional demand dynamics.

The report also notes that MSMEs receive the majority of their orders—about 84%—on weekends. Personal care products are the most sought after, comprising 27% of orders in Q1 2024, followed by apparel and footwear at 20%, electronics at 9%, and books and e-books at around 8%. Automobile-related products are the least in demand, accounting for about 1%.

Digital payments are gaining traction, with 42% of buyers choosing prepaid methods. Maharashtra, Karnataka, and Uttar Pradesh are significant contributors to order volume, accounting for 15%, 10%, and 9%, respectively. Buyer behavior shows that 53% of consumers are discount seekers, while 84% prioritize quality over price.

The data further indicates that 68% of orders in 2023 were discounted, with peak shopping hours occurring between 12 PM and 6 PM. These insights underscore the importance of targeted marketing strategies and highlight the substantial growth potential of the e-commerce sector.

“At Shiprocket, we are witnessing how MSMEs, the backbone of India’s e-commerce industry, are driving the market toward its projected $300 billion future. This growth is not confined to urban centers but resonates deeply across Bharat, showcasing the heart and resilience of our nation,” remarked Saahil Goel, Shiprocket's MD and CEO.

The report also highlights a rise in MSMEs using WhatsApp for direct marketing, increasing from 25% to 30%. Advanced technology solutions, including marketing automation tools, are being leveraged to optimize campaigns, personalize customer interactions, and enhance efficiency. Social media marketing, particularly on WhatsApp, has seen increased adoption, with usage among long-tail sellers rising from 35% to 40% and among SMBs from 25% to 30%. Data analytics tools are empowering MSMEs to better understand customer behavior, refine product offerings, and make strategic business decisions.

Looking ahead, the report emphasizes the need for inclusive growth as the Indian e-commerce market progresses toward a $300 billion future. Women-led MSMEs, which represent 20.5% of registered businesses and generate 19% of employment, are crucial contributors to this expanding market. Additionally, growing consumer concerns about sustainability are prompting MSMEs to adopt eco-friendly practices, such as sustainable packaging and electric vehicles. There is also increasing demand for ethically sourced products, including vegan beauty items, organic wellness products, and sustainable pet care products.