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8/3/2019 E-Commerce Market
1/21
An Introduction to E-CommerceMarket in India
by Anirudh Char
8/3/2019 E-Commerce Market
2/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
E-Commerce Market has evolved from a here-also to a dedicated platform to showcase,promote and sell products over the internet to an audience not limited by geography or store
location
1
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Backbone ofe-commerce
formed
NetscapeLaunched
SSLEncryption
enabledOnline
Shopping
One of thefirst large
companiesto reach $1mn in online
sales
GoogleLaunchedits betaversion
USPSLaunches e-stamps
Ebayacquires
PayPal for$1.5 mn
Amazon
posts firstever profits
Facebooklaunched for
collegestudents
AcquiresYoutube
iTunesbecomesthe largest
digitalmusicretailer
Broadband
penetration
witnesses
sudden growthin most
markets
globally3G networks by
Mobile
operators made
operational
New business models startemerging globally such as
Groupon, etsy, Kaboodle, etc.largely oriented to facilitate
online shopping
Mobile commerce witnesses aspurt backed by growingnumber of MIDs
The roots for social e-commerce were laid
Indian companies start toexperiment, new
entrepreneurs start onlinebusinesses
Even traditional players suchas utsav sarees, Chirag Din,
etc. find success in e-commerce
8/3/2019 E-Commerce Market
3/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
The e-commerce market in India is currently in its nascent stage and is expected to grow atabout 35% CAGR over the next 3-4 years
2
The e-commerce market in India is estimated to be valued
at over INR 30,000 Crores and is forecasted to grow ataround 35% CAGR over the next 3-4 years
The usage pattern, however, has remained quite uniform
and skewed over the years with services continuing todominate the overall market while others still lag behind.
Online travel contributes to close to 80% of the total
market
Financial services market, such as online insurance
payments and transactions through trading accounts, grewat an estimated 25% during the one-year period endingDecember,2010
Comprising 8% of the e-commerce market, this
sector is expected to grow by 34% by 2012
Online retailing contributes to about 8% of the total market.
It comprises of buying consumer items such as cameras,
computers, home & kitchen appliances, flowers and toys,gifts online
This category has grown from about INR 980crores in year 2007 to over INR 1,500 in year 2009;and is currently valued at about INR 2,200 crores.
8,146
14,030
19,688
31,598
46,520
0
10,000
20,000
30,000
40,000
50,000
CY 2007 CY 2008 CY 2009 CY 2010 CY 2011
E-Commerce Market in India (in INR Crores)
Travel Non travel Total E-Commerce Industry
Online Travel,
76%
Digital
Downloads,2%
Financial
Services, 8%
Other Online
Services, 6%
e-tailng, 8%
Components of the E-Commerce Market in India
Source: IAMAI report on the E-commerce Market in India
Source: IAMAI report on the E-commerce Market in India
8/3/2019 E-Commerce Market
4/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
Backed by a advances in technology, i.e. internet penetration, security, evolving userexperience management and cost competitiveness, the e-commerce market is only expected
to grow
3
Critical mass of Internet users 100 million Internet users
Mobile Internet is a big growth driver mobile installed base 6x to 8x bigger than PC installedbase
Rising middle class with disposable income consumers that are spread across the country
are computer literate and also have access to devices from where they can access the internet.
Middle class is increasingly turning to e-commerce as the primary outlet for sophisticated consumer
products and services
Payment gateways & logisticsnew breed of domestic logistics companies recognize the
importance of reliable delivery and technology investment, and a number of new payment gateway
companies such as CC Avenue have sprung up to service the growing e-commerce ecosystem.
Alternative payment methods such as net-banking and cash on delivery are now mandatory
offerings for leading e-commerce platforms
User ExperienceCustomers prefer a trusted relationship with an e-commerce brand, and theconveniences and reliability of e-commerce businesses have to outweigh the benefits of traditional
retail outlets
8/3/2019 E-Commerce Market
5/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
Marketing Companies
Business models in the space have evolved across the spectrum, engulfing personalizedtime-share on every device
4
E-Retailers -Brands
E-Retailers -
Stores
3rd Party Seller
PlatformsPrivate Sales Daily Deal
Stores
Mobile
Commerce
Push Deals
Penny Auctions
Infrastructure Execution / Integration Processing / Order
Fulfillment
Traditional E-Commerce Emerging E-CommerceBusinessModels
ServiceProviders
8/3/2019 E-Commerce Market
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
with convergence as the theme today
5
E-Commerce models are converging as different marketplaces and disruptivebusiness models are springing up and growing fast
amazons investment in living social
Groupon rejected offer by Google
GSI Commerce acquisition of Ruelala
E-Commerce is no longer only an alternative distribution channel, but a way for
brands and merchants to reach out to customers in a targeted manner
Convergence of e-commerce, distribution and services with full-service/marketing
E-Commerce is converging with content and social to create strong audiencerelationships and enable sophisticated audience segmentation and targeting
Higher content engagement, greater content stickiness
Higher consumer yield and consumer lifetime value
Greater audience reach and segmentation through social mechanisms
8/3/2019 E-Commerce Market
7/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
Friend Centric Social Shopping is fast evolving as a the next big wave, especially backed bythe increasing socially connected user bases on social networking sites
6
Group Buying /
Daily Deal
They offer deep discounts up to 90% off local products, services and events.
The sites are able to offer massive discounts because they rely on group buying offering local businesses a
slew of new customers who all purchase the deal in bulk
E.g.:Groupon, Snapdeal, etc.
Reviews and
Recommendations
People tend to trust peer reviews over corporate advertising. These types of shopping sites usually have a list
of products that are rated and reviewed by members of the site
This is nothing new think Amazon but with the latest social shopping craze, these recommendation sites
have really stepped it up: many offer discounts for reviewing a product or points for recommending a
purchase to friends and family.
Real-Time OnlineShopping
Users log on to a site and either connect with their friends via Facebook or another social network, or invitetheir friends and family via email. They can then shop online at the same time, discussing products and
getting each others opinion on services.
E.g.: Wet Seal, DoTogether
Geo LocationBased
Amid a relatively new form of commerce comes an even newer way to leverage social technology for
consumers: geo-location-based social shopping. Using a geo-location service like Foursquare or FacebookPlaces, this type of social shopping happens in brick-and-mortar stores. Upon entering, you are usually given
some points or are directed to in-store deals from within the geo-location app on your smartphone. Users can
also look up product information and interact with other shoppers, all via their smartphones.
The points earned can be redeemed for gift certificates at that stores
E.g.: Shopkick, myShopanion
Rewards Based
Social Shopping
Users are rewarded based on their purchases and on visiting stores (virtual or brick & mortar) which can hence
be redeemed for later buys. These are similar to credit card programs and more the users spend the faster they can accumulate the credits
Charity-BasedShopping
Another major trend in the social shopping experience is combining consumerism with charity. There are
several websites and apps that a llow users to somehow donate to charity when they shop. This donation is
usually either added on as a percentage of the sale, or, more commonly, costs the consumer nothing and
instead is given by a sponsor or corporate partner of the social shopping service
8/3/2019 E-Commerce Market
8/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
Hence, it is imperative for an E-Commerce company to develop the right set of capabilities tocapture the vast opportunities in the space, including but not limited to managing a users
experiences
7
Free Fall Stage Decisions are not
consciously made Actions do not have
consistancy Daily happenings direct
business Key factor for success is
luck
Guess Work Stage Decisions are based on
opinions Actions have limited
consistancy Personal motivations
direct business Key factor for success is
experience
Impromptu Stage Some decisions are
based on facts Some Actions
consistancy Facts direct some parts
of business Key factor for success is
focus
Imformed Stage Decisions are based on
absolute facts Actions have
consistancy Facts direct business Key factor for success is
accuracy
DecisionQuality
Maturity of
Decision
Towards mature decisions
UnawareAware Interested
Purchase
Loyal
Moving online store visitors up the relationship ladder provides significant opportunities for growth: Loyal customers have almost double visit to carts Loyal customers have almost triple conversion rate
Loyal customers have 10% higher cart value
8/3/2019 E-Commerce Market
9/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
and effectively using the data collected is imperative to business success
8
Focus Area Objective Sample KPIs Guidelines
Visits to theplatform
Attract different types ofvisitors to site using alternativechannels and approaches,providing differentiating valueadd
# of Visits per Month Unique Visitor Count per Month Advertising Cost per Visitor % of Visitors Bookmarked Site Page Rank of Homepage
Use search engine optimization using trafficInsights
Utilize variety of acquisition Channels Customize acquisition approach by prospect
Segment Provide additional reasons for visiting site
Subscriptionof visitors
Motivate subscription at firstsight, providing additional valueadd and good first impression
Subscriber / Visitor Ratio Total Unique Subscriber Count Number of Subscriptions per Month % of Subscribers with Full Data Duration From Visit to Subscription
Call to action for subscription on landing Page Make subscription fast and Convenient Provide immediate value add for Subscription Promote competitive value Propositions
Creatinginterest initems
Make items of interest easilyaccessible and pro-activelycommunicaterelevantinformation on merchandise
# of Items Viewed per Visit # of Items Viewed per Subscriber % of Subscribers Viewing Items # of Categories Viewed per Subs. % of Items Not Viewed for Long Time
Use effective and alternative categories for items Pro-actively recommend Items Provide ability to search with alternate means Provide creative and instructive item views
Creatingcustomerloyalty
Avoid abandonment of addeditemsproviding convenient transitionto check-out and following up
% of Item Adds Abandoned % of Item Adds Removed % of Cart Value Proceeded to Checkout Average Item Time in Cart Average Time to Checkout
Provide one click check-Out Make single item purchase faster Cross-sell before check-out Make added items accessible even if abandoned
Site
ReduceCartAbandonment
Ensure completion of check-outwith convenient processesandcart follow-up
% of Check-outs Abandoned % of Potential Value Abandoned % of Abandoned Carts Purchased Later % of Abandonment to Competitor Site % of Subscribers with Abandoned Carts
Provide convenience and speed in Checkout Remind and follow up abandoned Cart Motivate abandoned cart purchase with benefits
Make cart available in next visit if abandoned
8/3/2019 E-Commerce Market
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
and thereby, increasing sales, time spent and valuation of the platform
9
Focus Area Objective Sample KPIs Guidelines
StreamlinePaymentprocesses
Process payment securelyand using alternativemeans
% of Payments Bounced % of Potential Value Bounced % of Bounced Payments Abandoned Payment Attempts per Purchase Number of Fraudulent Cases Identified
Provide alternative payment modes
Ensure and promote payment Security Keep customers informed about payment Process Follow-up and recover failed Payments
Promote re-visit and re-purchase
Identify and motivate non-returning customersproviding additionalinformation and value add
% of Subscribers with 2 Purchases % of Subscribers with >2 Purchases % of Subscribers with >1 Visit % of High Value Loyalists % of Subscribers with Returned Goods
Regularly provide new content and Offerings Pro-actively take actions for dormant Visitors Provide value add for repeat Business Recommend for cross and up-sales
Promotesocial aspectson theplatform
Identify and promote thesocial aspects of the e-commerce platform toincrease sales and
valuation
% of subscribers liking products % of subscribers recommending products % subscribers commenting on products % subscribers visiting other platforms from
ours for comparison
Develop a rating scale for products Enable users to share the products either on thesame platform or other platforms
Motivate users to become prosumers by providingadditional value to them brand ambassadorprograms
Increaseinteractivitybuyer seller,seller-sellerand buyer-
buyer
Promote businesses aswell as business for themembers on the platform
% comments and replies on products % sellers responding to user queries # of comments on blogs and responses
Provide sellers with information on consumers fortargeted marketing
Provide interaction session off-line to promoteinteractivity between buyers and sellers
Hence, E-Commerce performance management, through effective strategies and tactics across customerlifecycle is imperative
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The key success factors
8/3/2019 E-Commerce Market
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
The key success factors for a start-up ecommerce platform
11
`
Key SuccessFactors
Procurementand deciding
on what to
sell
UserInterfaceDesign
ConversionRate
Personalization andProduct
Recommendation
ProductRecommend
ation
How and
when a
product isdelivered
8/3/2019 E-Commerce Market
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on What to Sell Deciding on product categories that is amenable to bemoved to the online space and thereby developing a niche for the e-commerce platform
decides its success
12
While targeting a large user-base is important, developing a niche product portfolio is essential to developing a brand image.
A new start-up can focus on one or a mix of the following to develop their own brand image in the market
1
Options What it means to the e-commerce platform
Luxury products at aunbelievable discounts
Developing relations with large brands offering them scale and in turn seeking discounts that can be passedon to the consumers
Constantly negotiating with the product / brand owner for better deals against larger volumes Constantly finding new brands to be showcased on the platform Maintaining product delivery time agreed with the customer as well as the product originator/aggregator
Niche products not available inthe geography/market
Sourcinga niche portfolio of products from other geography/ market such that it is cost effective for theusers
Maintaining product delivery time agreed with the customer as well as the product originator/aggregator Dealing with regulatory nuances in the local market for the product
Making day-to-day productsavailable convenience andprice
This can entail developing a large distribution network for delivering day-to-day products to the customers atgiven times
Sourcing the products on time each time Negotiating based on volumes, product portfolio and exclusivity in the region of presence
Linked to a larger cause Sourcingproducts that are linked to a larger cult or cause or aspiration in the domestic market
Large offline scale beingexploited online
All large retailers and aggregators can avail of this opportunity through tie-ups with regional logistics vendorsto have an online presence as well as a means of value added service to the customers
Products unavailable in the store can be added to wish-lists and sent to the customers to offer additionalvalue and maintain loyalty
A i i U I f D i f i fl d b h
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on User Interface Design entrepreneurs often get influenced by thecomplexities of their business and begin designing the experience for exceptions that
only apply to 5-10% of visitor
13
Abercrombie & Fitch
Apple
Crate & Barrel
Ann Taylor
TOOBYDOO
Russell & MacKenna
While user experience is critical to success on all types of websites, it is especially critical for ecommerce websites given that
visitors purchase decisions are linked to the aesthetics to the website. A poor user experience will result in loss in sales
Below are some examples of what I consider are aesthetically designed user interfacesOther examplesof well designed
e-commerce
websites include
1. DesignCode
2. Shoe Guru
3. J.Crew
4. Nestliving5. Naked &
Angry
6. Hard Graft
7. Hard Graft
8. Crate and
Barrels
9. ArmaniExchange
10..
2
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
in other words, a shop should give an average user the feel special, pampered andmotivated to buy, alongside subconsciously inducing trust
14
Identified below are some of the specific factors that are generally present on well-designed e-commerce websites
Design Aspect Why its important?
Navigation
Design for thedumbest andlearned willappreciate!
E-commerce sites often face considerable challenges with navigation because of the number of products that are presented on the
site Large sites, such as those of department stores, have to be especially careful with navigation, because finding what the user
wants will usually become increasingly difficult with more options
One factor to consider is how the average visitor will attempt to find a particular product
Sufficient user testing is extremely helpful for identifying potential navigational issues
Productshouldoverpower Design
A design that is extravagant for no legitimate reason will do more harm than good, it will draw attention to the design of the site
and away from the products
The focus of design should be on the product rather than on making the website a piece of art
Focus on Check-out
If the checkout process involves too many steps or is confusing, shoppers will wind up abandoning their cart with items left
unpurchased
Ideally, check-out should involve a minimal amount of steps and should be as easy as possible for shoppers Processing time is another aspect that should be taken care
Design to matchthe product
When designing an e-commerce site its important to consider the style of the products that will be available on the site
If the design style does not match well with the particular products that are for sale, there will be a disconnect that exists and
visitors may have a hard time relating to products and determining if it is right for them.
Showcase what isrelevant
Showcase the popular products rather than forcing products on to the shoppers
A number of sites are using a large area on the homepage that they can use to promote current sales, new product lines, or
whatever will generate interest
On theses sites, this area will often be updated frequently, or it may include some type of slideshow.
Promote relatedproducts
Promoting the right products that buyers are likely to be interested in is key regardless of the approach that is used
Photos whowantsto seeunclear photos?
Selling online is different than selling in a physical store because the buyer cannot touch the product or see it in person before
making a buying decision
Providing quality photos that accurately portray the product can help to overcome this challenge and can make the buying decision
easier on visitors
2
A viewpoint on Increasing Conversion Rate traffic is not the best metric to judge an e
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on Increasing Conversion Rate traffic is not the best metric to judge an e-commerce platform, instead, conversion rate is the metric new entrepreneurs should
worry about
15
3In the virtual world - online conversions can come in many forms. If youre selling a product online conversion happens whena visitor makes a purchase and becomes an active customer, and if youre offering a service your conversion might be gettingvisitors to phone-in
Flaunt yourUSP
Be open tocriticism
Agility toprice
variations
1 2 3
Mirror YourOffers on all
channels
WidenProductPortfolio
WidenPortfolio of
offers
4 5 6
Unless the USPs are copied across the site, a they might never be seenso make sure your USPs are visible across the site
Constantly look at additional communication channels such as onlinechat, Voice Over IP providers such as Skype and online feedback formsto ensure you cater for enough visitors as open communication can helpincrease your credibility
80% of customers research before committing to buy hence whilecomparing and adjusting your prices, look at the overall price to thecustomer also taking into account any shipping fees and taxes
Employ multi-channel coherent marketing to promote your products andservices
Always be on the lookout for new opportunities and closely followcustomer trends and taste Analyze, Analyze and Analyze
To become an appealing proposition, consider catering to as manycustomer groups as possible by diversifying your product offers
4
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on Personalization and Product Recommendation Move away from aproduct centric model to a customer centric model
16
4
Converse with your customer to understand their needs their aspirations
to reward themand trust on the backend numbersbut dont force your thoughts ontoyour customers, let them choose whatthey want
4
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on Product Recommendation give the users the power to identify,recommend and vote
17
4
aggregate wisdom Capturing and utilizing the wisdom of the masses to pro-actively caterto their needs.
Design Aspect Why its important?
Top RatedProducts
Visitors are recommended products based upon the rat ings received from other customers.
The products that receive highest aggregated ratings in any given category or sub category start appearing as recommendations for
visitors when they visit those categories or subcategories
Some e-tailers have actually started adding more predictive attributes in the rat ings, to help other individuals make better dec isions.
Collaborativefiltering
A highly advanced algorithm does statistical match across different product combinations and the recommendations are made
purely based upon the affinities across various products
The good thing about collaborative filtering is that it minimizes the level of manual involvement from category managers and
automatically finds patterns of product combinations based upon aggregate purchase behavior This is what powers People who purchased this product also purchased. type of recommendations at Amazon
Although these type of recommendations require a relatively high implementation cost, they minimize the need for setting upmanual business rules and can run on a Auto pilot mode to some extent
Though the biggest downside with collaborative filtering recommendations is that they tend to produce Averaging effects which
causes the overall most popular items to be recommended more often which means that they will be consumed and rated more
frequently as a result
Experts voiceHumans need a
human touch
Although it is good to see statistically relevant recommendations based upon a democratic way of collecting insights, humans bynature would take recommendations more seriously if they are coming either from experts in the category or from other individuals
who have similar tastes For example, a serious audiophile visiting bestbuy.com may not be interested in the best selling home theater systems on the site
The true power of online recommendations is where customers are able to get advice and recommendations from others like
them who they can trust more than the average crowd
5
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All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on Securing the Payment Channel Assurance and trust are key to repeatpurchases
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5All online retailers are concerned about minimizing charge-backs and payment fraud. This is one of those costs that can beminimized if appropriate and proactive steps are taken
Securing
your ownservers
Securingconnections
with yourusers
Securingthe
paymentchannel
1 2 3
Unless the USPs are copied across the site, a they might never be seenso make sure your USPs are visible across the site
Constantly look at additional communication channels such as onlinechat, Voice Over IP providers such as Skype and online feedback formsto ensure you cater for enough visitors as open communication can helpincrease your credibility
80% of customers research before committing to buy hence whilecomparing and adjusting your prices, look at the overall price to thecustomer also taking into account any shipping fees and taxes
Employ multi-channel coherent marketing to promote your products andservices
Always be on the lookout for new opportunities and closely followcustomer trends and taste Analyze, Analyze and Analyze
To become an appealing proposition, consider catering to as manycustomer groups as possible by diversifying your product offers
An e-commerce platform faces the followingsecurity threats
6
8/3/2019 E-Commerce Market
20/21
All views and opini ons in this document are personal and / or have been gathered based on extensive researc h in the sector and personal i nterest. All data points have been c ollected through secondary r esearch, informal industry contacts and I havenot undertaken any additional work to establish the reliability of the sources or to evidence independence of the relevant source . Furthermore, collection of data for market assessment has been limited to such information as can be collected fr omresources on the published public domain and meetings with market participants. Wherever suffici ent information was not available in the public domain, suitable assumptions were made to extrapolate values for the same. Hence, would request anyuser reproducing the information to contact me before using the same,
A viewpoint on Delivery How and when a product is delivered can decide the fate ofa platform
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6A developed and integrated logistics set-up is key to assuring and ensuring repeat business. Differentiation in terms ofproduct packaging and delivery provide the users the assurance
Giving the user the option to set delivery date and time can be makecustomers feel special
How a package is received at the door-step and how the customer isgreeted has a long term impact on sales
People dont like to wait, hence delivering the product on-time in the
best condition possible will influence loyalty as well as increasecustomer base
Customer is king and why should the customer pay for a damagedproduct? INSURE the product that is sent to the customer and tellthem that you are doing them a favor,
Who wants a product that doesnt look and feel like, what it seemed onthe platform? Give the users the option to return the product in casethey dont like it. This way a consumers confidence on the platform
increases
All the above cost money, and hence it becomes integral to identify thebest suited solution to the problem at hand
Options oninformed
delivery
PackagingOn-timedelivery
1 2 3
Insuranceon products
ReturnPolicy
ManageCosts
4 5 6
Challenges ahead an e-commerce start-up
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+91 91360 11000+91 99102 61161
a.chari
Working as a management consultant, for over 4 years I have had the
opportunity to work on several projects for Indian and International clients in theareas of Strategy Formulation, Validation & Implementation, Business Planning,
Entry & Expansion Strategy, Feasibility studies & Location Advisory and Market
Assessment. This entailed, advising several companies across sectors, such as,Telecom, Media & Entertainment, Mobile Value Added Services, Information
Technology, Infrastructure & Financial Services, Real Estate, Manufacturing,etc.
My technical background & my management degree from IE Business School
have not only provided me leverage while assisting my clients during project
delivery, but also while pitching for new assignments and cross selling theservices of the firm.
I have also been involved in a few start-ups and entrepreneurial ventures overthe past years that failed. The most recent venture was an online commerce
platform with a unique social value proposition. The other ventures have been in
the power sector and second-hand auto retailing.
Anirudh Chari
mailto:[email protected]:[email protected]:[email protected]:[email protected]