Mumbai: Shop Culture has released insights from its latest report, “The Commerce Reckoning: 2025 Global Intelligence Report,” highlighting a major shift in global e-commerce dynamics, with profitability pressures reshaping growth strategies and India’s quick commerce segment emerging as a key driver.
Based on observations across 20+ markets, the report notes that while global e-commerce is projected to surpass $6.86 trillion in 2025 with 2.77 billion online shoppers, brands are facing declining returns. The average return on ad spend (ROAS) has dropped to 2.87:1, driven by rising advertising costs, inefficient operating models, compliance challenges, and outdated growth strategies.
The report identifies three major structural shifts redefining commerce. Retail media costs are rising sharply, with platforms like Amazon reporting a 15.5% year-on-year increase in average CPC to $1.12. At the same time, while 77% of e-commerce professionals use AI daily, many brands are failing to unlock meaningful gains due to weak underlying systems. Additionally, geographic diversification is increasingly being viewed as a margin strategy, with brands expanding beyond single-market operations.
Commenting on the findings, Subarna Mukherjee, Founder & CEO, Shop Culture, said, “The e-commerce industry has a nostalgia problem. In 2022, the playbook was simple: list aggressively, spend on ads, and ride the wave of post-pandemic digital adoption. It worked. Revenue grew rapidly. But by 2025, the industry is seeing the consequences of those structural shortcuts. E-commerce itself is not slowing down the challenge lies in how brands are operating within it.”
A key highlight of the report is India’s rapidly expanding quick commerce ecosystem, projected to reach $5.38 billion in 2025, growing at 17%—making it one of the fastest-growing segments globally. Beyond convenience, quick commerce is increasingly being seen as a strategic margin lever for brands navigating rising marketplace costs.
Case observations cited in the report show that quick commerce can significantly impact performance, with one packaged food brand deriving 70% of its online revenue from the channel and achieving 130% year-on-year growth. Similarly, a beauty brand recorded 25% higher average selling prices on quick commerce platforms compared to traditional marketplaces.
The report also emphasises the growing importance of structured international expansion and regulatory readiness. It notes that markets such as the UK and Germany can serve as more effective entry points compared to the US, while compliance preparedness—especially in European markets—has become critical to faster go-to-market timelines and sustained revenue generation.
On the role of AI, the report highlights measurable gains when implemented effectively, including 10–15% improvement in conversion rates, 7–10% reduction in TACOS, and a 20% reduction in stockouts. However, these outcomes depend heavily on strong operational foundations.
Adding to this, Mukherjee said, “AI is not a growth strategy, it is an amplifier. It enhances strong systems and exposes weak ones.”
The report concludes that as brands head into 2026, success will depend on building sustainable margin structures, diversifying channels, ensuring compliance readiness, and adopting AI strategically—marking a clear shift from aggressive expansion to disciplined, profitability-led growth.
