This article originally appeared on Retailer India.

The global eCommerce industry in 2024 faced muted growth compared to previous years, with notable trends including TikTok, Shein, and Temu. India, on the other hand, has seen Quick Commerce emerge as a key growth driver. What initially started as an experimental channel for the FMCG sector has rapidly expanded across categories such as beauty, electronics, and even fashion.

Rising Challenges

Despite these advancements, challenges persist. Customer acquisition costs (CAC) and the rising cost of advertising remain pain points for brands globally. Platforms such as Meta and Google continue to dominate ad spend, but the landscape is shifting. Marketplaces like Amazon, Flipkart, Myntra, and Nykaa are positioning advertising as a core revenue driver. For brands, securing traffic and capturing consumer attention have become top priorities, followed by promotional strategies and discounting to drive conversions.

Revolutionizing the eCommerce

Generative AI has been a beacon of innovation in 2024, revolutionising how brands operate. Over two-thirds of eCommerce businesses have integrated generative AI into their workflows, leveraging it across the eCommerce value chain to create personalized shopping experiences, optimize inventory, and streamline operations.

In advertising, generative AI has enabled the rapid production of content and hyper-personalized campaigns. Content creation has streamlined the generation of multilingual content and improved optimization. For fulfilment, AI-driven demand forecasting has allowed businesses to predict inventory needs more accurately, ensuring product availability. These advancements underscore the role of AI as a catalyst for operational efficiency and customer satisfaction.

Equally intriguing is the rise of agentic AI—systems capable of making decisions independently. These technologies are reshaping customer service and supply chain management, operating seamlessly to predict and address consumer needs before they are articulated. This allows businesses to anticipate and fulfill consumer demands more effectively than ever before.

Festive Season Trends

The festive season highlighted the adaptability of eCommerce, with platforms reporting around a 20% increase in sales compared to the previous year. First-time online shoppers, many from Tier 2 and Tier 3 cities, contributed significantly to this growth. These areas are no longer secondary markets—they are central to the future of eCommerce.

Personalization and Authenticity

Consumer preferences have shifted toward brands offering personalization and authenticity, signaling the importance of trust in building long-term customer relationships. Data-driven strategies played a pivotal role in helping businesses deliver record-breaking sales while catering to these nuanced demands.

Quick commerce has solidified its position as a growth pillar in India, reflecting the operational scale needed to meet growing demand. Major players across categories have embraced this model, reinforcing its potential to redefine the eCommerce landscape in India. For consumers, speed and convenience have become non-negotiable, driving businesses to innovate continuously.

Data Privacy

However, this progress is not without challenges. Data privacy concerns have become increasingly prominent, with stricter regulations compelling businesses to prioritize transparency and security. For companies, this is not merely about compliance—it’s about building trust with a more aware customer base. Organizations that proactively address these concerns are setting benchmarks for the future.

Omnichannel Strategies

Omnichannel strategies have also become indispensable. The seamless integration of online and offline channels is no longer a luxury but an expectation. Whether it’s buying online and picking up in-store or personalized digital experiences inspired by physical interactions, businesses excelling in this domain are capturing a significant competitive edge.

Preparing for 2025

As we look toward 2025, the road ahead is clear. Indian eCommerce is poised for continued growth, driven by innovation, trust, and customer-centric strategies. Investments in generative AI, operational efficiency, and localized solutions will play a crucial role in shaping the industry’s trajectory. While challenges like rising CAC and data privacy persist, businesses that adapt and innovate will remain at the forefront of this dynamic and ever-evolving landscape.

Authored By Prem Bhatia, Co-Founder and CEO, of Graas.