Opportunities & Challenges for Online Retail in India

Opportunities & Challenges of

Online Retail.

Iksula Managed Ecommerce Services.

and many more..

Main Index.

1. Online Retail ----------------------------------------------------------------------------------------------------------------------------------------------------------------

1.a. Introduction to Online Retail ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

1.b. Online Retail in USA ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

1.c. Current Retail Industry in USA ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

1.d. Online Retail in India ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

1.e. Online Retail Market Size ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

1.f. Challenges in Pure-Play Online Retail ------------------------------------------------------------------------------------------------------------------------------------------------------------

2. Online Retail Operations --------------------------------------------------------------------------------------------------------------------------------------------------

2.a. Building blocks of Online Retail -------------------------------------------------------------------------------------------------------------------------------------------------------------------

3. Future Interesting Innovations --------------------------------------------------------------------------------------------------------------------------------------------

--

Effects on Retail Purchase Decisions with Ecommerce.What's happening.

Store 1

Store 2 Store 1

Store 1

Store 2

Search

Engines

Targeted AdsStore 1 Online

Website

Store 1 Online

Website

Purchase Decisions have got very informative but very

complicated for retailers.

Why are people choosing Online Retail ?The Reasons remain the same over years.

E retail Consumer Value Proposition.

Online Retail :: Online Retail in USA ::

WHAT HAPPENED IN THE US ??

Online Retail :: Online Retail in USA :: History of Online Retail US. ::

Online Retail boom started in 1994 in US.

2

41.6 %

17

6.0 %

18

16.0 %

29

5.6 %

118

4.9 %

24

8.9 %

20

8.4 %

57

11.6 %

53

7.8 %

Source: Internet Retailer „10

Launched macys.com in 1997.

Launched jcpenney.com in 1994.Launched gap.com in 1997. Launched toysRus.com in 1998.

Starts victoriassecret.com in 1995.

Launched staples.com in 1997.Launched ae.com in 1998.Launched staples.com in 1996.

Launched staples.com in 1998.

WEB SALES AS A % OF TOTAL SALES

INTERNET RETAILER TOP 500 RANKING

Within 4 years all major stores went online.

Online Retail :: Online Retail in USA ::

Retailers entering online space and dominating the online retail space.

But Amazon.com (a pureplay) still remains the market leader….

Source: Internet Retailer US

Convenience

Hard To Find

Price

Online Retail :: Online Retail in USA ::

Proposition of Online Retail in US.

Online Retail :: Online Retail in USA :: Proposition of Online Retail in US ::

Convenience : The Consumer Proposition.

Convenience

Books, Music,

Movies,….

Sit @ Home

and Get it

Selection

Deep

Research

Value Proposition , Categories and Formats.

Hard to Find

Antiques, Coins,

Radio Controlled

Toys ….

C2C Commerce

Cannot get it

Anywhere Get it

here

Local became

National with

second hand goods

Online Retail :: Online Retail in USA :: Proposition of Online Retail in US ::

Hard to Find: The Consumer Proposition.

Value Proposition , Categories and Formats.

Inventory Clearance

Discount

Price

Electronics,

Computers,

Price Discovery

Auction, Volume

Aggregation

Online Retail :: Online Retail in USA :: Proposition of Online Retail in US ::

Price: The Consumer Proposition.

Value Proposition , Categories and Formats.

Online Retail :: Online Retail in USA :: Share of revenues by Category. US ::

Detailed Category Division. US.

Source: Internet Retailer.US 2011

Online Retail :: Online Retail in USA ::

The Growth and Share Story…..

“Lets hold the plans to open another two retail stores, lets invest

the same capital to build a online web store for „GLOBAL‟ sales”

…a top US offline store.

Retail versus Online Retail.

Online Retail :: Online Retail in USA ::

Case Study.

Walmart. vs Amazon.

Round 1. Market Performance.

Walmart. vs Amazon.

Round 2. Products & Prices.

Food For thought

If the cost of monthly shipment and cost of trips to retail shops equals Amazon

would always be cheaper and occupy the pricing proposition completely

Walmart. vs Amazon.

Round 3. Brand Performance.

Amazon by proving higher brand ranking and customer service has proven that

this model can deliver to consumer expectations

Walmart. vs Amazon.

Round 4. Expansion & Innovation.

Walmart. vs Amazon.

Projected Revenue.

Key Take Away

•Amazon is projected to surpass

Wal-Mart in sales revenues in the

year 2024.

Online Retail :: Online Retail in USA :: Trends to Watch for ::

The “Store Killer” App.

Customers researching offline but buying online.

A few category retailers in US. shut down stores as

unable to compete with online retailers & competitors.

Online Retail :: Online Retail in USA :: Trends to Watch for ::

Online Retailers have affected a few industries very hard…..

Online Retail :: Online Retail in USA :: Managed Ecommerce Solutions ::

A Lot of Retailers opted with outsourcing it to Managed Services Companies.

A lot of retailers opted to outsource the area of non competence

and left it to a specialist.

GSI Commerce® is a leading

provider of ecommerce and

interactive marketing services

for the world’s premier brands

and retailers.

Online Retail :: Online Retail in India

WHAT’S HAPPENING IN INDIA ??

Online Retail :: Online Retail in India ::

Traditional Retailing Scenario in India.

3. The Product Advantage

Though the range of products sold by them is

only limited, they have the advantage of

selling in small denominations which majority

of the customers favor.

This keeps them the most understanding retailer

than the modern retail.

1. The Location advantage

Grab it from the next door shop is always

possible as the spread of traditional store is so

strong.

This is one advantage which the modern

retailers would be interested in adapting.

Almost every street in the country has a retail

identity.

2. The Familiarity Advantage

The traditional retailers are the familiar

one to generations.

Interestingly, this familiarity leads to building the

strongest relationship as well as the trust

mutually.

4. The Credit Advantage

Another interesting area is that they offer

monthly credit to the customers.

“This not only helps the salaried class but also it

relieves our worries for keeping the change

ready every time we purchase”.

Online Retail :: Online Retail in India ::

Indian Retailers getting into eRetail.

fulfillmntcust carecontenttech mkting

Offline Retail Online Retail

Store retailers are now getting into online retail as consumers are moving

online.

Online Retail :: Online Retail in India ::

Online Retail Market Size in India.

The market is growing significantly but early days.

Online Retail is still very small percentage of

the ecommerce pie and significantly under

penetrated in comparison to US Market

Online Retail :: Online Retail in India ::

Products Bought Online within and across the world.

Source: Ebay Reports

The Impact of E-retail is increasing across geographies

and product lines

Online Retail :: Online Retail in India :: Challenges in Online Retail :: Heavy Competition::

429+ significant players now operating…

and many more….

Source : Iksula Consulting

Online Retail :: Online Retail in India :: Challenges in Online Retail :: Taggle.com story ::

“It Also Happens in India”

Seems like a last man standing game has

started in pure play internet retailers.

Online Retail :: Online Retail in India ::

Indian E-Retail Landscape: A Summary.

Vertical

Source : „India Goes Digital‟ - Avendus

Online Retail :: Online Retail Operations.

Online Retailing.

technology content marketing

fulfillment cust care

But what you see is just the tip

of the iceberg.Seems easy and quick to build.

Online Retail :: Online Retail Operations.

Building blocks of E-Retail.

tech

mkting

fulfillmnt

cust care

Front End Back End

Customer 4

content

2

3

1

5

Order Sent

Order Fulfilled

Key Components of Digital Retailing

Ecommerce in the Future.

Online Retail :: Future of Ecommerce :: M-Commerce ::

Mobile Commerce.

Mobile App

At present, there are over 500 million mobile subscribers in the country.

By 2015, $350 billion in payment and banking transactions could flow

through mobile phones.

Future of Ecommerce :: Innovations :: T-Commerce. ::

Commerce on Tablet PC’s.

Aakash tablet

Only Rs.2,500 – 2,999

•The Ubislate website accessed 2012-02-07 informs that a lakh Ubislate 7+ devices

are being pre-booked each day.

•There is an additional requirement of 22 crore units of tablets.

Aakash tablets will boost mobile commerce in India.

Ecommerce on

Tablet PC

Social Shopping

Future of Ecommerce :: Social Shopping ::

Buying with Approval, Kaisa Lag raha hain?

Instant show and Tell.

Future of Ecommerce :: Social Shopping ::

What do my friends like? Peer Acceptance is

Key in Shopping Process. Isn't it ….

Instant show and Tell.

Innovations

Future of Ecommerce :: Innovations :: Payments ::

Ease and Payments at a Click of a Button.

New innovative payment solutions.

Future of Ecommerce :: Innovations :: Extra Convenience ::

Using the digital platform to offer in-store experience.

Efficient Selling.

Future of Ecommerce :: Innovations :: Improving Suggestions ::

How Service Retailing can use Digital ……..

Efficient Selling.

Thank YouFeel free to contact us for further queries

samar@iksula.com