4 Reasons that has fuelled the growth of Indian Ecommerce
There are about 100 million online shoppers in India (the 2ndmost populated country in the world)which includes large educated workforce. In comparison U.S has 205 million online shoppers. Quite close, Isn’t it ? This means Indian ecommerce market has grown, growing and will certainly grow drastically in coming years. There are many ecommerce website operating in India. But what makes these 3 ecommerce websites – Amazon, Snapdeal and Flipkart to become most popular?
Given below are our observations on the ecommerce trends in India.
Crazy behind Mobile Commerce
Indians love mobile. Almost 65% of consumers buy products through mobile. The top reason behind this is affordable mobile cost with cheap mobile data plans and the convenience to buy products anywhere, anytime. Whereas desktops and laptops are expensive and not very portable. Population which cannot afford both goes to internet cafes.Now even the rural population is contributing to mobile commerce growth, as rural residents start obtaining mobile devices.
Somewhere or the other consumers get price conscious at some moment. But Indian are little bit more price conscious and this point is rightly used by giant ecommerce marketplaces. They offer heavy discounts, do promotions, give away coupons or freebies to attract them. This tactic worked well in India but retailers are not very happy with it because it cut downs their profit margin. So they have started a new trend of consumer loyalty points and better personalization of products to overcome cost cutting of products.
As price sensitivity has made its home in consumer’s mind, few retailers have unfortunately started selling counterfeit products in Indian markets that give them good profits. This led to short term profits and traffic but resulted in a long term loss to Indian ecommerce product authenticity. Every online marketplace can be legally suedfor selling counterfeit products to consumers. Hence ecommerce websites are making efforts to regain consumer confidence by guarantying product authenticity. These giant marketplaces post disclosure in their website pages about their product authenticity and post reviews for the same from their registered consumers or sometime mysterious consumers.
Favourite Payment Method – Cash on Delivery
Just like any other ecommerce website abroad, Indian ecommerce websites has all popular payment methods but Cash on delivery has fuelled the growth of Indian ecommerce. Yes, Cash on delivery is the most preferred payment method in India. This is because Indians are not very fond of using credit cards due to security concerns. But cash on delivery increases additional burden on marketplaces, logistics and otherwise increases the chances of order cancellation rate. Ecommerce companies are therefore making efforts to convert more customers to credit cards and direct bank transfers by giving cash backs and purchase points.But it would be much better if the marketplaces otherwise improve their cash-on-delivery processes.
From internet sources we found that Amazon’s C.E.O., Jeff Bezos, recently announced a $5 billion investment into the Indian ecommerce market, further confirming the opportunity in that country. No wonder that Indian markets are easy to enter, sell and flourish.