India witnessed an increase in demand for e-commerce platforms in the last quarter of 2020, indicating substantial change in consumer behaviour during the Covid-19 situation

The e-commerce space posted a significant uptick in demand in 2020 due to the Covid-19 pandemic. The last quarter of 2020 saw e-commerce order volume growing by 36 per cent in India with Personal care, Beauty and Wellness (PCB&W) segment being the biggest beneficiary, according to a report

In October to December 2020 period, PCB&W and FMCG & Healthcare (F&H) categories' volumes grew by 95 per cent and 46 per cent year-on-year (YOY) respectively, said the Q4- 2020 -E-commerce Trends Report', released by Unicommerce and Kearney.

The spike in volume growth of Q4 2020 indicates the significant demand for e-commerce platforms. The report noted that the Covid-19 pandemic and related lockdowns led to a massive change in consumer habits with many new users and sellers joining the digital platforms.

Tier 2 and 3 cities accounted for a 90 percent YOY incremental volume and value growth, the report said.

It said brand websites reported a 94 percent volume growth in fourth quarter of 2020 as compared to the same period last year.

According to the report, the last quarter of 2020 saw e-commerce grow by 36 percent and 30 per cent YOY in terms of order volume and gross merchandise value (GMV) respectively, while the average order value declined by five per cent in Q4-2020 as compared to the same period last year.

The Electronics category witnessed 12 per cent YOY growth in average order value (AOV) in addition to 27 per cent YOY growth in volumes. Fashion and accessories continue to be the largest segment by volume. It reported 37% YOY volume growth, but AOV declined by 7% YOY in Q4-2020 compared to the same period last year.

With people still working from home, the growth of the category is supported by the purchase of lower value products such as comfort wear and loungewear, the report said.

The lockdowns and reluctance to venture out resulted in many first-time online grocery shoppers, making it an important category for mainstream e-commerce players like Flipkart and Amazon to actively focus and promote the grocery business.

CEO of Unicommerce Kapil Makhija was quoted as saying in a wire agency report that the impact of the COVID-19 pandemic has been widely visible ever since the lockdown was announced in March last year.

The e-commerce industry has emerged as the backbone of the retail industry and small and big players have realized the immense potential that e-commerce holds, he added.

The Partner, Kearney, Siddharth Jain, was quoted as saying, "The Personal Care, Beauty & Wellness category is an incredibly interesting area of growth online, as it has seen stupendous volume growth of over 95 per cent in Q4-2020, as compared to the same period last year".

"Tier II and Tier III+ markets have shown maximum growth potential, outpacing that of Tier I cities. During the quarter in review, these cities accounted for a whopping 90 per cent YOY incremental volume and value growth," Jain said.

Read the full report in Business World