In the past decade, e-commerce in India has grown to become a massive industry that is moving as we speak at a breakneck speed. With the emergence of smartphones and the internet penetration due to this phenomena, the rise of tier II and III cities and aggressive competition by key players in the market, the Indian e-commerce industry is growing at a compound annual growth rate of 52% and poised to break the $36 billion mark by 2020. The industry witnesses between 1 and 1.2 million orders per day on an average, which can give an idea of the size and scale of the sector.

While all this may be true, it is also important to set a realistic picture in front of us. In the Indian online retail market, the big players like Flipkart, Amazon, etc. occupy a privileged position, accounting for more than 90% of the total market share, according to this Business-Standard report. The rest ten odd percent is then divided into thousands of small and medium online retail enterprises that operate online. The other important consideration is that the online retail industry in India only comprises of about 3% of India’s total retail industry.

Internet penetration, which e-commerce thrives on, is not an enviable statistic when it comes to the Indian market, with only about 34% of the country connected to the internet, according to Internet Live Stats. These numbers make the Indian online retail industry look as cut-throat as it is lucrative. And it is true – being an online seller is not an easy job, especially if you want to get it right.

It would be wise to remember that as an online seller, one encounters competition from a large spectrum of competitors – from sunday sellers on eBay to giants like Flipkart. It is therefore important that one keeps a few key features about market behaviour and business in mind before making any move, for it may end up costing you a lot. Here are a few common mistakes that you should avoid as an online retailer in the Indian market.

Common Online Retail mistakes and the Lessons you need to learn

1. Market Misrecognition

Your target market may be one that inherently deludes clarity – markets generally tend to do that. You can never be completely sure that a particular person will or will not be interested in buying a particular product. But at the same time, it is a mistake to completely misrecognize your market, because it leads to low interest in your product without it being the product’s fault. It is therefore important to enter online retail by performing a few extensive product and market related surveys that help you get a better idea about the kind of customer who would be interested in your product, their whereabouts and the ways in which they can be reached, both physically and over the internet through social media, among other things. Armed with this information, you can now strategize about creating a stable customer base that you can directly address and interact with.

2. What kind of Online Seller are You?

There are many kinds – there are drop shippers who act as links between the customer and the wholesaler and earn profits on commission. Or you may want to partner up with a logistics service provider in your area so that you can gain some control over the delivery of your product. If you have the capital, you may even want to invest in an in-house logistics arm that would make you completely responsible for shipping your product.

You may even want to list yourself as an online seller on one of the bigger marketplaces and use their shipping services to deliver your product. Instead, you may want your standalone website to be the only online store that sells your product. Or, you might want all the above things along with a brick-and-mortar store to run your business. The point is that every online sales outfit is unique in how it aligns itself with the rest of the industry. It is important to know where you stand, for this will give you a clear idea of how to move about in your long term plans and strategies.

3. Underestimating Logistics

Logistics is an aspect of online sales that often operates under the shadows so to speak, but that does not undervalue its importance. It would be safe to say that there is no online retail without logistics, because there is no online transaction until the product is delivered to the customer. Various online sellers take different approaches towards logistics, with some deciding to leave it alone completely and opting for something like drop shipping, or others who aggressively enter the fray by operating logistics in-house. Either ways, as an online seller, one has to pay extra attention at logistics.

If you are planning to outsource shipping, it would be wise to triple check the background of your partner and carefully monitor the proceedings. Although a mistake in this case would be the shared responsibility of the logistics provider and the seller, since the seller is the one in contact with the customer, it is easy to see how harmful such situations can become. This is not just limited to delivering products on time, but extra attention should be given to things like Cash on Delivery and product returns management.

4. Social Media Missteps

Social media forms the backbone of the online retail industry due to its extensive and personal reach and opportunity for customer involvement. As so many companies with social media mishaps can testify, it is not easy to manage your social media account, and getting into trouble here can lead to massive consequences. Achieving social media success is more art than science, although it is important to collect and analyze a lot of data so that you can visualize your customer better. Facebook, Twitter and Instagram are great ways to not just start a conversation about your product, but also solve customer grievances, offer discounts, find new customers and grow your brand. A good tip would be to look into a social media management portal like HootSuite and also to talk to a social media marketing expert.

5. Not Investing in an Inventory Management System

Finally, in our list of newbie blunders that you can commit on the online retail market is, not investing in an inventory management system. If your aim while entering the online retail market is to scale up, you must have systems in place that allow you to do so. An automated inventory management system is a must-have for an online seller, simply because today’s market, that thrives on fast fulfillment, demands it. A multi-channel inventory management system like Browntape handles incoming orders from all your online sales channels and connects them to your warehouse, allowing you to disburse your products in an efficient and timely fashion. Moreover, additional features like automated tracking mails to your customers and the sheer ease of managing all your listings allows you to focus on the more exciting aspects of your job as an online seller.

These are some of the common rookie mistakes that online sellers regularly commit. To know more, get in touch with Browntape. We are India’s leading e-commerce solutions experts and we are always happy to help!


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