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Deep dive into ecommerce by GBG Mumbai - Sep 20th 2014
This document summarizes a presentation given by Sreeraman Thiagarajan on e-commerce in India. It discusses the growth of the Indian e-commerce market from 2012 to 2021 based on Technopak estimates. It outlines key factors driving online shopping adoption in India like time poverty in major cities and the proliferation of internet and smartphone usage. The presentation covers topics like the market scenario, consumer buying behaviors, opportunities for selling online through marketplaces, and how companies like Google can help drive e-commerce through tools like product listing ads. It also discusses emerging models like hybrid commerce leveraging local retailers and the potential of local language e-commerce.
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Similar to Deep dive into ecommerce by GBG Mumbai - Sep 20th 2014
Deep dive into ecommerce by GBG Mumbai - Sep 20th 2014
- 1. Deep Dive Into e-commerce September 20th, 2014 at MPSTME, NMIMS, Mumbai
- 2. @GBGmumbai @sree_raman @rajivPrakash @singlaharish
- 3. What’s GBG? GoogleBusiness Group (GBG) – Mumbai helps startups and entrepreneurs to use Web Technologies and Digital Marketing for business success.
- 4. What We do? • Workshops • Seminars • GDayX • WoW Programs Know more here http://gbgmumbai.org/events/
- 5. Best in thenation, 2nd in the world (L to R. Sirish from GBG Belgaum, Aditi from GBG Jaipur and Sreeraman from GBG Mumbai GBG Mumbai was awarded as the ‘Best Chapter’ In India by Google at the ‘Google Community Summit, Asia 2014’ held at Sri Lanka during the last week of August
- 6. Time to DiveDeep into e-commerce Keynote by Sreeraman Thiagarajan, Chapter Manager, GBG Mumbai
- 7. What’s the biggestthing that happened in last 48 hours that makes Amazon a dwarf?
- 8. Alibaba finished the day at $93.89, giving the company a market value of $231 billion, larger than Procter & Gamble Co
- 9. The Basics e-Tail E-tailing is a subset of e-commerce that entails the sale of product merchandise Does not include sale of Services viz. railway tickets, airlines tickets, portals, etc. e-Commerce Encapsulates all “commerce” conducted via the Internet
- 10. The Market Scenarioin India e-Tail 2012: USD 0.6bn 2021: USD 76bn e-Commerce 2012: USD 10bn 2021: USD 100bn Source: Technopak
- 11. Lets talk somebuyology
- 12. Money rich, timepoor Bangalore Mumbai Delhi Chennai Time poor citizens of India now buy everything from groceries, movie tickets, fashion goods, or bill pay and utilities online to get that extra time which they can spend for personal reasons or leisure.
- 13. Lets thanks theseguys Habit is a very important in the process of buying. While BSNL and MTNL were the pioneers to provide internet connectivity, Tax & Railway department has made people comfortable to use internet for transacting
- 14. Travel related purchaseis the most common entry point for ecommerce This group is likely to spend more than 2x the regular user Source: Google, Nielsen study
- 15. This proliferation ofInternet usage will alter the manner in which such Internet-habituated consumers will pick up trends, form opinions, learn about new things, and consume merchandise. Source: Technopak
- 16. Shift in Internet-habituatedconsumers E-mails News Travel Social Media Shopping Gaming Video Streaming Application downloads Mobile / Internet Banking 2010 2008 2012 Source: Technopak
- 17. Where are thesepeople? 167mn Active Internet User Top 8 metros contribute only 32% Towns with less than 1mn population contribute nearly 50% Source: Technopak & Comscore
- 18. Who are thesepeople? 60mn+ SEC A Segment Over 60mn people from the SEC A segment who form the part of population with highest buying power Source: Rajan Anandan’s keynote talk
- 19. The Masses arenot left behind too The transition from feature phone to smartphone 40 mn SP In 2012 600 mn In 2020 380 mn FP In 2012 450 mn In 2020 Source: Technopak
- 20. Top 5 Motivationsto Buy Online • Fast Delivery • Ability to pay COD • Discounts • Access to branded products • Cash back guarantee on faulty goods Source: Google, Nielsen study
- 21. Top 5 FactorsPreventing to Buy Online • Inability to touch • Limitations in returning faulty goods • Unwillingness to post personal or financial information online • Inability to bargain and get better deal Source: Google, Nielsen study
- 22. How Can GoogleHelp you?
- 23. Drive Based onInsights To begin with, Use Google Trends to map what volume of search happens from a given location over a time period. These insights will help in crafting your product/service offerings.
- 24. Drive Based onInsights Trends result for search term ‘online shopping’ has largely come from the eastern sister states in India, which are relatively smaller contributors to GDP and the reason for high search volumes can be attributed to lack of branded stores and malls. Hence they make buy online.
- 25. Who is thisguy and why’s he important for driving ecommerce in India
- 26. Its Mobile allthe way • The big guys of Indian ecommerce such as Makemytrip and Flipkart are now driving consumer to try their mobile apps. • They even incentive to download their apps Images here show the grabs from their TVC where prominence is given for the mobile app
- 27. Driving the next40mn smartphones in few months • Sundar Pichai launched Android One in India during the 2nd week of September. • Android One aims to empower the common man with the power of internet. • The effects of this will be increased ecommerce transaction form mobile
- 28. Product Listing Ads Know more here http://www.google.co.in/ads/innovations/productlistingads.html
- 29.
- 30. enable your store/ service / business Solve a problem for your customers • If you are a brick and mortar store. At first level, enable your customers to buy from you online and allow COD or online payment solutions. • If you are starting new, try to solve a problem creatively and efficiently and customers will love you and stay loyal with you.
- 31. Keep up withthe way people buy… See the demo from Google I/O 2014 on How Wearable will change the way customers order online. Click here to watch http://youtu.be/s_LYIQwwQVQ?t=11m46s
- 32. @sree_raman Thank you! Continued…
- 33. eCommerce 2.0 RajivPrakash @rajivprakash
- 34. 34 3 4 Quo Vadis – Where is eCommerce headed? Photo credit: REUTERS/ K. K. Arora
- 35. A caveat “Whateveryou can say about India or eCommerce, the opposite is also true.”
- 36. 5 thoughts abouteCommerce 2.0 1. Marketplace First 2. Hybrid Commerce: your neighbourhood kiranawalla eCommercewalla 3. Apni Basha: localisation 4. Rural (e)Commerce: how to get to Sangrampur, Buldhana 5. Content, Community and Commerce: a new trinity Disclaimer: Next In works with some of the companies covered in this presentation, namely, Reverie, iPay, Martjack, Find Me A Shoe and in3Access.
- 37. Image credit: JonahKessel.com 3 7 India is now a Marketplace First eCommerce market Regulations Selection &Sellers Customers – Search & Transactions Capital
- 38. Implications for Sellers(Retailers and Brands) • Sell on multiple marketplaces • Management of multisite operations and inventory • Customer Service - marketplace ratings and reviews • Price comparison and transparency • Online only brands • Need for myownwebsite.com, search marketing?
- 39. Feeding off amarketplace transaction Sale Price Marketplace Commissio Seller Payment - = n Customer Acquisition Cost - Affiliate Commission, Price Subsidy Payment Gateway Fulfillment Warehousi ng Operations Cost Price
- 40. Marketplace First ecosystem– a possible scenario Market places Online only brands Retailers Distributors Freelance sellers Brands Marketplace Selling Services Marketplace Retailers Marketplace Selling Technology Platforms Warehousing & Order Processing Content Creation Hybrid Channels Catalogue Aggregators Couponing Comparison Shopping Search Ad Networks, Retargeting, Email, Social selling, etc Online Customer Service Technology Plug-Ins for Marketplaces – Fit, Localisation, LookBooks, Online Chat, Analytics Events Training & Certification Seller Management Systems Logistics Logistics Payment Gateway and collection Services Customers – B2C&B2B Marketplace Sellers Marketplace Seller Support System Marketplace Support System & Channels
- 41. Opportunities along theconsumer shopping journey Discover Consume Learn / Research Buy Collect Comparison Shopping Reviews Marketplaces Hybrid Channels Hybrid Channels Reviews Customer Service Coupons Social engagement Affiliate Sites Content – Community – Commerce Models Content – Community – Commerce Models Payments
- 42. Hybrid Commerce –your friendly neighbourhood eCommercewallah
- 43. Tapping into thefield entrepreneur network • General Trade accounts for over 80% of retail – 10 million + field stores – kiranas and others • Current culture – people buy from people. Drivers – trust, access, knowledge and convenience • Proven model in airtime sales. • Tablet based sales model. Potentially, download an app and get started. • Issue – IP based Affiliate commission model. Should one own the buy side too? • Examples: Big Bazaar Direct, iPay, eDabba, Walmart Cash n Carry and Unilever - Peelworks
- 44. Apni Basha –The Indian Language Opportunity Spot the local language user
- 45. Background • 90%of Indian literate population (over 700 million) are non-English users • 11 languages cover over 90% of Indian population • 9 out of top 10 Indian newspapers = Indian language publications • 70% of TV viewerships = Indian language channels • By 2020, what % of internet users will be Indian language users? • And for them, the mobile will be the first and only personal computing device. • Myth: Local language is a bottom of the pyramid opportunity
- 46. Local language businessawareness and user adoption in digital domain is growing • 100 million smartphones to be sold in 2014-15 : by Q4, over 60% will have local language support – rendering of local languages and Indian language input keypad (source – Reverie). • Reverie powered Micromax Unite 2 – Indian language phone. 1 million sold in 3 months. Fastest for Micromax • NewsHunt – 7 million + monthly users, approaching 100 million user base • Opportunities: Affiliate eCommerce Sites in Local languages eg Running Flipkart Tamil as a service, Localisation Services to eCommerce companies, local language versions of all popular eCommerce utilities.
- 47. Rural Commerce –going beyond Mere Desh Ki Dharti Is this the rural market?
- 48. Opportunity Landscape :filling the media – market gap - Majority of Indians live in semi-urban and rural areas - 100,000+ pincodes: India Post - Media reaches most of these pincodes but markets don't - 30,000+ pincodes by courier firms - Rural people are not an alien customer segment. Similar to urban customers, they too are highly aspirational, have high levels of disposable income and are increasingly brand conscious - Problems – Mindset, Reach and Sales Channel - Example in3access: Selling products through Post Offices and MFIs/NGOs – 1 million orders in 2013-14.
- 49. The new trinity- Content, Community and Commerce Source : Mary Meeker, Internet Trends, KPCB 2014
- 50. Houzz.com – bestexamples of CCC Source : Mary Meeker, Internet Trends, 2014, KPCB
- 51. Indian environment •Strong appetite from brands to use a CCC approach to eCommerce : combines marketing and commerce. Eg Godrej Nature Basket • Pioneers and startups: JJ Mehta & Co, Stylecraze and Urbanhomez
- 52. Other trends •Return of Enteprise/offline eCommerce projects : Brands and Retailers • Affiliate Based Models – Sweet Couch, AllMemoirs, etc • Solving a difficult technical problem: Find Me A Shoe • Getting Offline to Online in non-traditional and unorganised sector - EatAds: Marketplace for Outdoor Advertising. • Export and import eCommerce • Made to Order eCommerce (Shoes of Prey)
- 53. eCommerce 2.0 RajivPrakash @rajivprakash Continued…
- 54. Online Marketplaces By@singlaHarish
- 55. Online Marketplace Opportunity Online Sales Opportunity Own ecommerce Site B2B Selling – Indiamart, Justdial, Classified Listing Online Marketplaces Short-term – 3 to 9 Months Instant Brand Recognition Smaller Sales Initially Long-term - > 9-12 months Decent Incremental Sales Branding Supports Off-line Sales
- 56. Marketplace – TheRight Place to be… Ancient Mandies Market s Baza ars Shopping Malls Online Marketplaces
- 57. An Online Marketplace “An online marketplace (or online e-commerce marketplace) is a type of e-commerce site where product and inventory information is provided by multiple third parties, whereas transactions are processed by the marketplace operator.” “In an online marketplace, consumer transactions are processed by the marketplace operator and then delivered and fulfilled by the participating retailers or wholesalers (often called drop shipping).”
- 58. Stages - Sellingon Online Marketplaces Tie – up with Marketplaces •Product Selection •Agreement •Negotiate Commercials Product Display •Photo-shoot •Cataloging – Content Writing •Upload on various Marketplaces Warehousing •Warehousing as separate inventory for online •Actual Time Inventory Update Order Management •Downloading Orders – Manually or software •Pick, Pack, Invoice, Label, Manifest, Dispatch After Sales •COD Returns Management •Customer Service •Maintaining Good Ratings Payments •Reconcile Payments at single transaction level •Raise dispute (if any)
- 59. Critical Success Factors– Online Marketplaces Product Display Picture Quality of Product No. of Pictures – Diff Angles Display in Actual Use Content Written about the product Price Competitive Pricing Customer Discount Participate in discount campaigns No. of Options No. of unique products With full range – Color, Sizes etc. Big Catalog Big Sales Inventory Items stocked as separate inventory Stock sync frequency No Compromise Factors Dispatch within 24 Hours No Order Cancellation / Wrong Product Follow Packaging Guidelines Invoice, Label, Tape etc. Instant Response to Customer query Seller Score / Rating – Best in Class
- 60. Revenue and Charges How marketplaces charge its sellers Realistically how much sales one can expect
- 61. How Marketplaces charge– An Example: - Selling Jeans Net Credit • Credit after Charges and Taxes • Rs.799 – 202 – 40 = Rs.557/- Taxes • VAT - @5% or Rs.40/- • Total Charges including VAT Rs.242/- or 30% Marketplac e Charges - FK • Fees 15% - Rs.120/- • Courier Charges – Rs.50/- • Fixed Fees – Rs.10/- • Service Tax on All Charges – 12.26% Rs. 22/- • Total: Rs.202/- or ~25% MRP • Rs.799/-
- 62. Economics of StartSelling Online Marketplaces Manpower Cost – 2 of Rs.20k p.m. each Computer / Software to Download Orders – Rs.10k p.m. Admin / Sitting Cost Rs.5-7k p.m. Each • To Break-even for Rs.1 Lac cost, sales required Rs. 5 lacs/500 orders p.m. @20% margin • >500 orders – You may need more employee • Hence total cost for selling online goes 30%+20% = 50%+ • Hence Better Outsource to Expert eDistributors Your own Time 30% Cost – Rs.30k p.m. Total Cost for selling online Approx. Rs. 1 Lac p.m. You can not get manpower at lesser cost as employees who know this business are not at all available. Job Catalog, Upload, Campaign, A/c Mgrs. Follow-up, Dispatch, Inventory etc. Software needed to download/tract orders, Inventory sync, computer systems etc. available at p.m. basis – otherwise huge capital expenditure Depending upon location there is real-estate cost / rental for making one employee sitting + other admin expenses Director’s / Owner’s own time is expensive. As he/she spends same time on core business, might get better returns. Hence this is huge cost to tally payments, campaigning, Promotions, talking to account managers etc.
- 63. Success Stories &Learnings Few Successes Denim Brand • New business, not interested in online, Low price Jeans for Men MRP Rs.899/- onwards • Listed a year back, regular sales from day 1, Presence on Top 10 Portals • Success: - Today 4-5 lacs per month, Launched Women Denim, Jackets, 3/4s on our request – No Discount given so far, Always good stock, Display Good, Price OK Salwar Suits Manufacturer • Small manufacturer of Women Ethnic wear, Wanting more sales, MRP Rs.2000-5000/- • Listed a year back, Sales went up and down, Presence on all portals, Regular Sales • Success: - Today sales Rs. 5+ Lacs online contribute 25% of his total sales, Launched low price Kurties, Unstiched Suits, Kids wear etc. on our advise, Mantra – Good Quality at reasonable price, Awesome display, Stock depth etc. Few Learnings Linen Shirts’ Brand • Established Manufacturer, New product line, Non-basic product, Price 1800/- onwards, Slim-fit only • Listed on major portals, few rejected due to price equivalent to Zodiac, Nice photo-shoot & content • Failure: - High price, Slim-fit of a product meant for 35+ age, quality issues, Target segment confusion, sold just 30 pcs in 3 months, no same day shipping, no discount offered..
- 64. BluBox.in Model (www.Reitindia.in) Tie – up with Marketplaces • Product Selection • Agreement • Negotiate Commercials Product Display • Photo-shoot • Cataloging – Content Writing • Upload on various Marketplaces BluBox.in Warehousing • Warehousing as separate inventory for online • Actual Time Inventory Update Order Management • Downloading Orders – Manually or software • Pick, Pack, Invoice, Label, Manifest, Dispatch After Sales • COD Returns Management • Customer Service • Maintaining Good Ratings Payments • Reconcile Payments at single transaction level • Raise dispute (if any) BluBox.in Provides Single Window Service Brand 1 Brand 2 Brand 22 Brand 99 Flipkart Snapdeal Amazon Ebay C U S T O M E R S No need to tie-up separately with each portal Single Payment cycle End 2 End service Provided by BluBox.in Still your own brand name is displayed Model Making Online Selling Easy Simple sales and inventory back-end panel
- 65. Thank you Youmay reach me: [email protected] 9321779010 Continued…
- 66.
- 67. What comes toyour Mind when you have to Buy or Sell used stuff Online or Find a Flat-mate or Search Services? Various Online Classified Apps / Websites
- 68.
- 70. What IF Youdo not have to worry much about the trustworthiness of the Seller. Some of Your friends are looking for stuff which you are selling or Some of your friends are selling what you are looking for You can help your friend who is in need of something which you don’t need anymore.
- 71. Here comes India’sFirst Social Classified Website
- 72. Search what your friends are selling Sort Ads based on Trust Factor Follow people and get notified about their Deals
- 73. . Trust Factor We have developed an Algorithm which gives a rating to each Ad based on certain parameters. We call it TRUST FACTOR. Some of the Parameters are: Facebook Friend Mutual Friends Photos Posted Spams Reported Followers’ Count Data Filled
- 74. Connect https://www.facebook.com/trusty deal https://www.twitter.com/TrustyDe al http://www.pinterest.com/trustydeal pin https://plus.google.com/+Trustydeal [email protected]
- 75. Deep Dive Into e-commerce Join GBG Mumbai at http://gbgmumbai.org/join-gbg-mumbai/