Opportunities & Challenges for Online Retail in India.

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Presentation for leading retailers of India at Delhi Retail Summit 2012 to educate them on Ecommerce and Online Retail.

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Opportunities & Challenges for Online Retail in India.

  1. 1. Opportunities & Challenges of Online Retail.
  2. 2. Iksula Managed Ecommerce Services. and many more..
  3. 3. 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 ------------------------------------------------------------------------------------------------------------------------------------------- --
  4. 4. Effects on Retail Purchase Decisions with Ecommerce. What's happening. Store 1 Store 2 Store 1 Store 1 Store 2 Search Engines Targeted Ads Store 1 Online Website Store 1 Online Website Purchase Decisions have got very informative but very complicated for retailers.
  5. 5. Why are people choosing Online Retail ? The Reasons remain the same over years. E retail Consumer Value Proposition.
  6. 6. Online Retail :: Online Retail in USA :: WHAT HAPPENED IN THE US ??
  7. 7. 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.
  8. 8. 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
  9. 9. Convenience Hard To Find Price Online Retail :: Online Retail in USA :: Proposition of Online Retail in US.
  10. 10. 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.
  11. 11. 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.
  12. 12. 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.
  13. 13. Online Retail :: Online Retail in USA :: Share of revenues by Category. US :: Detailed Category Division. US. Source: Internet Retailer.US 2011
  14. 14. 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.
  15. 15. Retail versus Online Retail. Online Retail :: Online Retail in USA :: Case Study.
  16. 16. Walmart. vs Amazon. Round 1. Market Performance.
  17. 17. 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
  18. 18. 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
  19. 19. Walmart. vs Amazon. Round 4. Expansion & Innovation.
  20. 20. Walmart. vs Amazon. Projected Revenue. Key Take Away •Amazon is projected to surpass Wal-Mart in sales revenues in the year 2024.
  21. 21. Online Retail :: Online Retail in USA :: Trends to Watch for :: The “Store Killer” App. Customers researching offline but buying online.
  22. 22. 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…..
  23. 23. 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.
  24. 24. Online Retail :: Online Retail in India WHAT’S HAPPENING IN INDIA ??
  25. 25. 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”.
  26. 26. 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.
  27. 27. 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
  28. 28. 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
  29. 29. Online Retail :: Online Retail in India :: Challenges in Online Retail :: Heavy Competition:: 429+ significant players now operating… and many more…. Source : Iksula Consulting
  30. 30. 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.
  31. 31. Online Retail :: Online Retail in India :: Indian E-Retail Landscape: A Summary. Vertical Source : „India Goes Digital‟ - Avendus
  32. 32. Online Retail :: Online Retail Operations.
  33. 33. 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.
  34. 34. 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
  35. 35. Ecommerce in the Future.
  36. 36. 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.
  37. 37. 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
  38. 38. Social Shopping
  39. 39. Future of Ecommerce :: Social Shopping :: Buying with Approval, Kaisa Lag raha hain? Instant show and Tell.
  40. 40. Future of Ecommerce :: Social Shopping :: What do my friends like? Peer Acceptance is Key in Shopping Process. Isn't it …. Instant show and Tell.
  41. 41. Innovations
  42. 42. Future of Ecommerce :: Innovations :: Payments :: Ease and Payments at a Click of a Button. New innovative payment solutions.
  43. 43. Future of Ecommerce :: Innovations :: Extra Convenience :: Using the digital platform to offer in-store experience. Efficient Selling.
  44. 44. Future of Ecommerce :: Innovations :: Improving Suggestions :: How Service Retailing can use Digital …….. Efficient Selling.
  45. 45. Thank You Feel free to contact us for further queries samar@iksula.com

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