How India shops online:

Consumer preferences in the metropolises and tier-1, 2, 3, 4 cities


of the surveyed respondents prefer using apps to shop online.


of the rest of India tend to use COD as a payment mode.


of the respondents look at the ratings and reviews before shopping.


of the respondents tried new brands after watching on social media.

In the past few years, about 12.5 crore consumers in India shopped online for the first time and since then, they have continued to use e-commerce platforms. These consumers – primarily from tier-2, 3 and 4 cities – differ in digital literacy, infrastructure, social and cultural factors from the urban dwellers, who are accustomed to shopping online. 

Online shopping is not just a convenience but a lifeline for millions of consumers in India, especially in tier-2 and 3 cities, where the availability of the latest and popular products in physical stores is limited. These consumers are the drivers of a retail revolution in the country. In the festive season of 2023 consumers from tier-2, 3 and 4 cities contributed to more than 80% of sales for Meesho and Amazon highlighting a major opportunity for brands to tap into the growing aspirations and needs of consumers from these markets.

india shop image

Organisations which serve our vast, diverse nation know how India changes every 100 kilometres – not only in terms of language, dialect and culture but also in consumer behaviour (motivations, pain points and preferences). However, there is a lack of comprehensive and reliable data and insights on the online shopping behaviour of Indian consumers, and the challenges and opportunities across regions. This hinders the development of effective customer-centric strategies and offerings.  

To understand this we conducted  an online survey of 2,100 people, 100 qualitative interviews, and 400 in-person interviews across India with leading experts and industry partners. The insights derived from the study highlights the similarities and differences in the purchasing habits, choices and mindsets of online shoppers across the country.

We aimed to understand the pulse of India’s diverse consumer base and provide insights into their behaviour. 

Understanding the shopping behaviour of urban dwellers and rest of India

Today, consumers from rest of India are dedicating more time to shopping, with order volumes in tier 2 and 3 cities expanding by more than 60% compared to previous years. 

In densely populated urban areas, consumers often come across excessive weekend crowds at malls and limited product variety within physical stores. The absence of premium brands nearby and the persistent push given to some products by sales staff who often lack product knowledge has further fuelled the migration of the consumers to online shopping platforms. Frequent stockouts for specific brands has been an additional cause of frustration for consumers.

In contrast, consumers from rest of India face another set of challenges, including limited access to a wide range of products and brands in local stores. This often restricts their choices. Additionally, unavailability of attractive offers and discounts and other incentives has pushed price-conscious consumers in rest of India to explore digital avenues. 

Like most urban households, in rest of India, big ticket purchases are not solely driven by men and homemakers play an active role in influencing decision making, even though men are the ones making the actual purchase.

The absence of physical stores for premium brands, stockouts of certain products, and a lack of knowledgeable staff in offline stores are the main reasons why the rest of India consumers opt for online shopping. On the other hand, the lack of discounts and special offers in physical stores, along with large crowds in malls during weekends are some of the reasons why urban dwellers prefer to shop online. 

It has been observed that apps are preferred over websites to shop online. However, this behaviour changes when it comes to purchasing high ticket items. 

Social media has amplified the awareness and aspirations and 62% of users tried products after seeing them (perhaps repeatedly) on Facebook and Instagram. As the preferences of the rest of India shifts from TV and radio to digital avenues, social media becomes the most preferred channel for encouraging trials of new products.

Urban dwellers, who prioritise speed in online shopping, are particularly drawn to prompt delivery services which meet their demand for instant gratification and are willing to pay a premium price for the same. But consumers in rest of India are keener on deals. These consumers are bargain and discount hunters.  

Interestingly, the rest of India appears to be leading the purchases in the sports and fitness, home and kitchen, and health and wellness categories, whereas urban residents focus more on grocery, electronics and fashion. Below are some other notable insights across categories:


Urban dwellers and rest of India consumers display comparable acceptance levels of UPI payments, indicating a rise in adoption and familiarity with such payment methods. However, it is worth noting that cash on delivery (COD) remains the preferred option among the rest of India consumers to minimise the risk of frauds.

As most urban women navigate shopping platforms like seasoned pros, weighing their benefits and drawbacks, older women in rest of India tend to approach it with more cautious curiosity than others and are hesitant to shop online due to concerns about payment fraud, credibility of unfamiliar websites and doubts regarding product quality matching the images shown.

Empowering small towns: Driving big business

E-commerce is on the cusp of a revolution, having penetrated to the farthest corners of our country and providing access to several new shoppers.This increased reach can be attributed to social media penetration in the country which has heightened awareness about e-commerce among Indian customers. However, accessibility and affordability of products will remain key drivers. One must consider that the consumer base is constantly evolving and that consumers often adopt new ways of shopping (enabled through new technologies/designs/business models, etc.) quickly, especially when their unmet or unarticulated needs are fulfilled through the rapid phase of innovations. Utilising the nuances of customer behaviour and segment-specific insights brought out by this report, organisations can expedite the crafting of e-commerce experiences that resonate with consumers in these regions (rest of India). 

india shop image 2

While price sensitivity is a key decision-making factor in rest of India, it is crucial to understand that customers’ value perception is based on the total service package (delivery, return experience, loyalty, etc.) delivered by the brand. Newer online users warm up to brands that offer to educate them and provide them guidance like a trusted advisor would. The need of the hour is a well thought-out brand and social media strategy that focuses on this group of users’ unique functional and emotional needs and engages them through their preferred channel(s). 

In conclusion, the call to action is to be simple, clear and local: that is going to be the key to growth in these markets.

Contact us 

Somick Goswami

Partner and Business Transformation Leader, PwC India


Ravi Kapoor

Partner and Retail and Consumer Goods Leader, PwC India


Prateek Sinha

Partner and Experience Consulting Leader, PwC India


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