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Wednesday, Oct 23, 2002

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B2C e-com spending to cross Rs 2,300 cr in 4 years: IDC

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BUSINESS to consumer (B2C) e-commerce spending in India is expected to jump by 88 per cent in 2002 and touch Rs 238 crore, said an IDC study, conducted recently to map the B2C e-com market in the country, amongst the Internet shopping Web sites and the people who have actually bought on the Net.

Music CDs, gift items, books and consumer electronics top the list of items purchased on the Net in terms of volumes transacted, while travel has emerged as the fastest growing category in value terms.

Categories favoured by `early adopters' have become the staples of B2C environment, while gift items and consumer electronics followed by travel top the list in value terms. A forecast said that B2C e-commerce spending would cross Rs 2,300 crore by the end-2006 at a compounded annual growth of 79 per cent, the IDC release said.

"What is interesting is that travel has emerged as the fastest growing category for the B2C e-commerce segment. Currently it is estimated to contribute 23 per cent to the B2C market and is expected to account for nearly 60 per cent of the B2C market by 2006. With Indian Railways and domestic airlines launching the online sale of tickets, this segment is expected to grow at a phenomenal rate of 140 per cent," said Mr Munish Myer, Head - Internet, Communications and Convergence Research at IDC (India). Mobile phone is the second fastest growing segment.

Not only is B2C e-commerce growing, but also Internet-assisted commerce has grown by around 70 per cent over 2001 and is estimated to be around Rs 210 crore for the year 2002. Financial services and home loans account for nearly 45 per cent of this particular segment followed by auto and real estate.

A survey to understand the experiences and behaviour of Internet buyers revealed that nearly 40 per cent of the buyers preferred shopping on the focused shopping sites, while an equal number of people did not have any specific preference between a shopping site and large portals offering shopping amongst other things. is a strong favourite with nearly 35 per cent of the buyers having transacted on this site.

While, convenience has emerged as the single most important reason for buying on the Net, cash on delivery has emerged as the most preferred mode of payment, followed by credit card.

Mr Dinesh Jindal, Senior Analyst, IDC India said, "What is heartening is that more than 80 per cent of Net buyers term their online experience as satisfactory or highly satisfactory. This is very important because these people will act as referrals for these shopping sites and will be instrumental in getting more people to the Net. Prompt customer service and ability to track the order is something that most of the buyers value a lot.''

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