India’s E-Retail Boom: Set to reach $190 billion GMV by 2030: Bain report

India’s e-retail market is set to grow to 170–170–170–190 billion by 2030, driven by an expanding shopper base, innovative models, and rising GDP. Currently the world’s second-largest e-retail shopper base with 270 million consumers, the sector is recovering from slowed growth in 2024. High-frequency categories like grocery and lifestyle will dominate, while quick commerce and trend-first commerce emerge as key drivers. Smaller cities and Gen Z shoppers are reshaping demand, creating opportunities for inclusive, tech-driven growth across India’s e-commerce landscape.

India’s e-retail industry is poised for an impressive transformation, with its gross merchandise value (GMV) projected to skyrocket to $170–$190 billion by 2030. This remarkable growth will be driven by an expanding consumer base and innovative business strategies, according to a joint report by Bain & Company and Flipkart.

As of 2024, India holds the position of the world's second-largest e-retail shopper base, boasting over 270 million online consumers. While the market, currently valued at $60 billion, has experienced a slowdown in growth—dropping to 10–12% in 2024 from over 20% in previous years due to macroeconomic challenges—the future looks brighter. The report projects that the sector will regain momentum, achieving over 18% annual growth by 2030, coinciding with India’s per capita GDP surpassing $3,500–$4,000, a critical threshold often associated with rapid e-commerce expansion globally.

High-frequency categories such as grocery, lifestyle, and general merchandise are expected to dominate, contributing to approximately 70% of the sector's incremental growth by 2030. Penetration in these categories is anticipated to increase two to four times over the next few years.

One standout segment is quick commerce (Q-commerce), which currently accounts for around 10% of the e-retail GMV and 70–75% of the e-grocery GMV. With an annual growth forecast exceeding 40% until 2030, Q-commerce is redefining the market through larger order sizes and reduced logistics costs. This model is now branching out beyond grocery into other categories and expanding its reach to new cities.

“We have seen a 40 per cent increase in average order values, 3–4 percentage points improvement in gross margins and 30 per cent lower logistics cost per shipment in mature catchments over the last two years. To sustain profitable growth, players must adapt their business models and supply chains as they expand selection, geographies and manage competition," said Manan Bhasin, partner at Bain & Company.

The report also highlights the rapid growth of e-retail in smaller cities. Since 2020, Tier-III and smaller cities have contributed around 60% of new online shoppers and 45% of total orders. This trend is mirrored on the supply side, with 60% of merchants onboarded since 2021 hailing from Tier-II and smaller cities.

Another emerging trend is “trend-first commerce,” particularly in fashion, which is gaining significant traction. By 2028, online penetration in the fashion segment is expected to surpass 50%, driving its value to $8–$10 billion. This innovative model is also making inroads into categories such as beauty, electronics, and luggage.

Additionally, hyper-value commerce, which caters to lower-middle-income consumers, has seen its share of the e-retail GMV grow from 5% in 2021 to 12–15% in 2024. This growth is particularly strong in smaller cities, reflecting the increasing inclusivity of India’s e-commerce landscape.

Generation Z shoppers, who represent about 40% of the country’s e-retail consumers, are reshaping shopping behaviors. This tech-savvy demographic relies heavily on social media for brand discovery, spends three times more on emerging fashion brands, makes quicker purchase decisions, and prefers Unified Payments Interface (UPI) for digital transactions.

"The rise of quick commerce, trend-first commerce and hyper-value commerce is transforming the landscape, creating exciting opportunities for brands and retailers who can cater to the diverse needs of Indian consumers. The democratisation of the shopping landscape with widening access to national brands and assortment in Tier-III and smaller cities and remote, underserved areas is a key driver of growth," said Arpan Sheth, partner at Bain & Company.

With its diverse consumer segments, innovative business models, and rapid adoption of technology, India’s e-retail industry is set to enter an exciting new chapter, offering immense opportunities for brands, retailers, and consumers alike.