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Offline Commerce Is The Battlefield For The World's Third Largest Consumer Market - India

Photo of Map of India On the Globe

By AltG Research On Behalf Of Poornima Vardhan And Taponeel Mukherjee

The past decade in Indian commerce has been characterized by fierce competition between online giants like Flipkart, Amazon, and Meesho (same model as Shopclues), and offline players like Reliance, Aditya Birla, and Dmart. Meanwhile, RetailTech ventures like Khatabook, Bikayi, and Udaan were expected to revolutionize Kirana stores. However, recent financial data paints a more complex picture. Meesho reported INR 3359 Crores in revenue but a loss of 3248 Crores. Khatabook's revenue was 78.19 Crores, but it incurred a loss of 111.19 Crores. Bikayi had a revenue of INR 2.07 Crores, but a loss of -10.22 Lacs. In contrast, Dmart saw a net profit of INR 1492 Crores on revenue of 30,976 Crores, with a compounded growth rate of 30% over the last ten years and profit growth of 38%.

Despite the popularity of e-commerce, which currently only represents 3% of the market, 97% of Indians still shop offline in brick-and-mortar stores. This suggests that many consumers may bypass "Online Only" commerce models and embrace "Phygital Commerce" - a blend of discovery online and shopping offline. This trend could be analogous to how India skipped the desktop era and went straight to mobile internet access.


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