The research firm Gartner recently stated, the Asian digital commerce market is growing at more than 40% each year. According to an SBI research report India’s e-retailing sector, comprising of online stores and online marketplaces, is the fastest growing segment. The report stated that in 2015, e-retail was worth $6 billion, which may be an understatement.
The real impact of Indian ecommerce came into effect in 2015 with its ecommerce exploits. And reports say a 36% growth in Indian ecommerce is certain during 2015-20. We have the rising use of smartphones and impressive online discount offers to thank for this. However, these factors were just the gateway to an impending outcome. The Indian workforce is made up of young consumers who enjoy shopping and are willing to spend. Only problem, they lack the time for conventional shopping at brick and mortar stores. This is where ecommerce in India gets its advantage. Furthermore, attractive online offers and purchase plans make this method of shopping more appealing to Indian consumers.
The considerable improvements in the ecommerce market and online payment structure, have gotten both sellers and buyers over their fears of online business risks. The big (ecommerce) fish like Flipkart and Amazon made successful attempts to get hundreds of sellers online, which drew more attention to ecommerce this year.
So what were the noteworthy trends and achievements of such a grand year in ecommerce?
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Making the most of popularity – Joining the ecommerce bandwagon
Reliance and Birla Group are mega offline retailers and their entry into ecommerce did not go unnoticed. In fact, their ecommerce debuted was a result of coaxing from Flipkart and Snapdeal. By October, Reliance’s main man Mukesh Ambani informed everyone that Reliance Industries plans on launching its ecommerce portal by the end of 2015; for fashion goods and electronics. On the other hand, the Aditya Birla Group launched its online portal for all things fashion! The one stop shop for the trendiest fashion.
Many other vendors joined the online scene this year on account of the opportunities and to get a hold of their own ecommerce exploits. They either ventured out on their own or joined forces with other ecommerce players. Marketplace sponsored advertisements, product listing ads and specialized apps to assist sellers have been made available to online retailers to improve their experience in various online marketplaces and encourage more sellers to join the digital market space.
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By all means
2015 has been the year of innovative logistics. Shipping and delivery in India can be problematic due to the lack of development in rural areas and the traffic clogged city routes. Many online marketplaces have devised solutions for their last mile delivery making it as simple as:
- Dabbawalas collecting packages from Flipkart’s distribution centers in Mumbai and getting them to the correct recipient just in time for lunch. It’s low-tech, inexpensive, extremely effective and error free.
- Kirana stores are your local grocery stores. There are at least 12 million of them (give or take) and Amazon is using this network to test out its shipment pickup strategy. Where customers can go to pick up their packages themselves.
- India Post has 154,882 post offices (as of 2014 only) and a vast majority of them are found in the nation’s villages. Online marketplaces ShopClues and Snapdeal are working with state owned India Post to reach their shoppers in the remote corners of the country.
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Anything sells online, what have you tried?
The most popular products in India’s online marketplaces this year have been mobile phones and other related electronics. Next in line is apparel, followed by consumer durables according IAMAI. But did you hear about the strangest products sold this year? Well it’s cakes, cow dung cakes or patties to be exact! It may be an unusual product on ShopClues, Amazon and eBay, but the mix of dried cow manure and hay is selling like hot cakes on the internet because of its multiple uses in Indian homes for cooking, gardening, religious rituals and heating. And its limited availability in the cities makes it a good albeit odd product to sell online. Which goes to show almost anything can be sold online!
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The shift to smartphones
Myntra went App-only this year and everyone is still on the fence regarding whether or not it is the best or worst move. Unconfirmed news about Flipkart going App-only in 2015 seems to be untrue. That does not mean the ecommerce mega star won’t kick their desktop site to the curb this year. As a matter of fact, many marketplaces have been concentrating on the use of their mobile apps. Word is, smartphone sales are increasing and by 2018, 9 out of 10 hand held devices will be smartphones.
Flipkart’s CEO Sachin Bansal said in an interview while specifying why mobile commerce makes sense, “The payment innovations are also mobile-centric. Some 100 million smartphones are being sold every year in India, even as desktop/laptop sales are declining. It clearly makes more sense to think mobile.” Which explains why the Big Billion Days were app exclusive.
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Festive season = Ecommerce warfare!
October was all about the festive season, yes, but the battle of the marketplaces was on everyone’s mind. It wasn’t entirely three dimensional this year with Paytm looking for a piece of the action. However, the cash back strategy they used wasn’t much of a game changer.
The main contenders:
Flipkart – Big Billion Days Sale
– Focused on app-only sales
– Sales pitch – ‘Abhi Nahi Toh Kabhi Nahi’, which built urgency
– 20 million visits in 19 hours and 150 million total visits
Amazon – Great Indian Festive Sale
– Used attractive deals and discounts
– Sales pitch – ‘Try Toh Kar, Hoke Befikar’, telling everyone there is one place for everything and that is Amazon
-Top deals sold out in 30 minutes
– 65% of orders came from Tier 2 and Tier 3 cities
Snapdeal – 5 Day Diwali Sale
– Extended festive sales to every Monday till Diwali
– Sales pitch – ‘Yeh Diwali, Dil ki Deal Wali’, aimed to tug at the consumers emotions
– 6 million orders shipped during the Diwali sale
– 98.6% on time deliveries during Diwali
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Shocking investments
Do they have favorites or are they just playing the field? Major ecommerce investor, Tiger Global has an investment of $16.3 billion in Amazon, when it acquired 2.44 million shares of the international ecommerce giant. Tiger Global also has an investment in Amazon’s rival Flipkart with other investors, which is worth around $1.7 billion dollars. Another big name to invest in rival marketplaces is Alibaba. Economic Times reports, a huge investment of around $680 million went towards the purchase of 20% of Paytm, which increases Alibaba’s stake in the company. And out of the $500 million Snapdeal received as investment this year, Alibaba is just one of the investors. The legendary Ratan Tata is known for his business sense and incredible judgment. But he too happens to have invested in Paytm. That’s not all, Ratan Tata’s ecommerce investments include Bluestone, Urbanladder, Snapdeal and Zivame. There is no favoritism visible here, just strategic investment to spread out the risks.
Who’s at the top?
Amazon was officially India’s largest online store in 2015, which is its biggest of all ecommerce exploits in India. Around 55,000 new products are added to its inventory every day. It is also the most visited e-commerce site according to comScore. Despite this, Flipkart was the most Googled word of 2015 in India, whereas, Amazon is the fourth most searched word, Snapdeal fifth and Paytm tenth.
