Online travel continues to dominate Indian e-commerce

Travel was the first industry to garner significant digital sales in India.

And according to the Internet and Mobile Association of India (IAMAI) and Indian Market Research Bureau (IMRB) International, it remains by far the biggest segment of B2C e-commerce sales.

Totaling US$6.44 billion in 2012, online travel sales accounted for nearly three-quarters of all B2C e-commerce sales, as noted by the IAMAI and IMRB’s “Digital Commerce” report.

While travel remains dominant, other types of e-commerce are catching on, and the IAMAI estimates travel’s share will decrease to 71 per cent by December 2013.

Online retail sales – ‘etailing’, according to the report – are expected to grow more than 50 per cent in 2013 and reach just more than US$1.87 billion by year’s end, driving non-travel sales’ increase in market share.

While other types of e-commerce are gaining steam in India, online travel sales are still rising fast, estimated to increase by US$1.9 billion in 2013, a greater raw increase than for total etailing sales, which is by far the largest not-travel category.

The IAMAI/IMRB report noted that transit tickets – air, rail and bus – comprised 97 per cent of all online travel sales in 2012, with this category heavily dominated by domestic air tickets (50 per cent of all online travel sales) and rail passes (39 per cent).

Only two per cent of all online sales came for lodging accommodations, which means there’s still plenty of room for growth in online hotel bookings.

eMarketer’s projection for travel e-commerce sales in India is higher than the IAMAI’s, with the category estimated to have reached US$9.61 billion last year.

But the growth forecast for 2013 is similar: eMarketer anticipates digital travel sales will rise by 29.1 per cent this year. The IAMAI expects growth of 26.7 per cent.

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