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E - COMMERCE
Presented by
FOUR SQUARE
Introduction
Types of E-commerce
1.Business to Business
• Manufacturers selling to distributors and
• Wholesalers selling to retailers
– Trade india.com
2.Business to Consumer
• To the general public
• Not limited to just trading
• i.e, includes services as well
– Ola / Flipkart
3.Consumer to Consumer
• Companies review the consumer's requirements
and bid on the project
– Quickr
– E-Bay
4.Consumer to Business
• Photographers selling their work
to ad agencies
E - Tailing
E-Tailing
Contents
• Growth in E-Commerce & E-tailing
• Commodity Distribution in E-tailing
• Conventional Retail v/s E-tail
• Where the products come from
• Pricing Structure
Growth in E-commerce & E-tailing
(In India)
Commodity distribution in E-tailing
Conventional Retail v/s E-tail
• Conventional Retail Model
• E-tail Model
Where the products come from
Supply Mechanism
1. List your products
• Easy to use self-serve portal
• Catalog & photo-shoot partners
across India
2. Sell across India
• Easy dashboard
• Promotions and advertising
• Analytics support
3. Ship with ease
• Dedicated pick-up service
• Packaging support
• Pan-India reach
Requirement
• VAT ID
• PAN CARD
• BANK ACCOUNT
4. Earn big
Fastest payments settlements
Lending partner network
Pricing Structure
Example
Shipment
Marketing
Marketing Strategies
• Focus - to reach the top of search results
• Search engine optimization
• Pay-per-click marketing
• Social media marketing, and display advertising
• Better delivery options
• Personalized approach
• E-mail Newsletters
• K.I.S.S. - keep it simple, stupid
• Narrow Your Focus
• It’s a Mobile Device World
• Partnerships
Marketing Strategies
Valuation
Comparison with conventional business
“Got a great new idea? Are you from IIT? Here's a $5 million cheque”
• Flipkart's valuation – over $15 billion (Rs 100,000 crore)
• Tata Motors - Rs 95,000 crore.
• Hindalco - Rs 16,000 crore
• Snapdeal - Rs 35,000 crore
• Jet Airways - Rs 3,800 crore
• Ola Cabs - Rs 30,000 crore
Myths
• App-based firms - essentially brokers and couriers.
(Ola, Snapdeal, Flipkart, Grofers, Foodpanda)
1. Gross merchandise value (GMV)
Not the actual revenue earned
2. Huge discounts - not excluded from GMV.
Facts
• The real revenue of e-commerce sites is broadly around 5% of their GMV.
• No start-up is listed;
so scrutiny by financial analysts is limited.
• VCs and PEs are betting that sheer volumes will eventually make even five
per cent of GMV a big number!
Examples
• Flipkart - "real" annual revenue of just over Rs 3,000 crore on a GMV of Rs
40,000 crore. i.e 7.5%
• Its audited annual loss on account of discounts in 2013-14 was a
staggering Rs 719.50 Crore.
• But when six-year-old Uber is valued higher than 107-year-old General
Motors, we know that a brave new world is already upon us.
Acquisitions
WHY DID
FACEBOOK
ACQUIRE
WHATSAPP
How Does Whatsapp Make Money
• $1 at a time
• Other SMS apps
• Focusing on growth
• Is it really about the money?
• The Bottom Line
Why 19 Billion $
• By financial metrics, of course not.
• Btw, The company employs 52 people!!(Only?)
The thinking behind the deal
Reason 1. The next billion users
Reason 2. The new SMS
• Reason 3. To stop anyone else buying it
• Reason 4. Face book is now a conglomerate
– (Instagram users love Instragram because it isn’t Face book)
• Reason 5. Engagement
WhatsApp was a warning shot
• Combined Face book, Instragram and WhatsApp will bring Zuckerberg close to 2
billion active users. Naturally there will be significant overlap (figures for which
haven’t been disclosed),
• It grew to 400m users and a $16bn valuation three years after launch. If Face book
gets its strategy wrong another rival will likely grow even faster.
Revenue Generation
Do E Commerce sites in India make money
• Flipkart Vs Amazon Vs Snapdeal:
– Revenues & Losses Comparison
• GMV or Gross Merchandize Value represents the price of products
sold and net revenues is just a fraction of that!
• Flipkart leads the race here to losing 2.23 rupees for every 1 rupee
of revenue. Amazon loses 1.90 and Snapdeal has least amount of
losses at Rs. 1.72.
Ways of earning revenue
1. Pay Per Click Advertising
• Pay Per Click (PPC) / cost per click (CPC)
• Click-through rate (CTR)
You can find PPC adverts for your website at these popular sites:
Google AdSense
Chitika
Clicksor
BidVertiser
2. Cost Per Mile Advertising
• Instead of getting paid on a per-click basis, you get paid according to the
number of impressions (page views) you get.
3. Text Link Ads
• Non-intrusive way to monetize.
• Sign up to that specific product affiliate advertising scheme.
4. In-text Ads
• In-text ads’ are adverts that are placed inside your text content.
• The user can then decide if they want to click on it, which will make you a
small amount of money.
• More obvious than the previous type.
5. Advertising Widgets
• Mixture of PPC, text link ads and affiliate programs.
6. Advertising Space
• Selling space on your website for advertisers
– Facebook allows other companies to post ads
7. RSS Adverts
• Google FeedBurner
8. Audio Advertising
• Pay per Play (PPP)
• Podcast ads
• less intrusive
• Like commercial breaks
9. Pop-ups/Lightboxes
• Indirectly - PopUp Domination
• (sign up to our email list)
10. Affiliate Marketing
• If they buy, then you get a commission, maybe 10-20%
– Check out these great websites that have links to loads of affiliates:
• ClickBank
• ShareASale
• Skimlinks
• AffiliateWindow
Understanding Revenue Models
Understanding Revenue Model
Contents
• PAYTM Revenue model
• Customer perspective
• Partner Perspective
• Transaction fee & Top Merchants
PAYTM Revenue Model
Advertising Subscription
Advance Commission
Transaction
Customer perspective
• Chat messaging(for bargaining)
• Easy accessible
• Quick payment at paytm
• Mobile friendly
• Safe and secure payment
• RBI approved digital wallet
• 45+ banks for net banking.(one of the largest Payment Gateways in India.)
Partner perspective
• Highest success rate of payment gateway transactions
• India's largest Digital Wallet
• Amazing User Experience
• Wide Range of Payment Options - 0+ net banking options
• Simple Payment
• Great Dashboard
• Awesome conversion
Transaction Fee
Nature of transaction Charges
Loading money into wallet Nil
Purchase at merchant site Nil
Wallet to wallet transfer Nil
Wallet to bank transfer 4%
Top Merchants
Impact of E-Commerce
Advantages of E-Commerce
1. Customers Point of View
• Convenience
• Time saving
• Options, options, options
• Easy to compare
• Easy to find reviews
• Coupons and deals
2. Business point of View
• Increasing customer base
• Rise in sales
• 24/7, 365 days
• Expand business reach
• Recurring payments made easy
• Instant transactions
Disadvantages of E-Commerce
1. Customers point of view
• Privacy and security
• Quality
• Hidden costs
• Delay in receiving goods
• Need access to internet
• Lack of personal interaction
2. Business Point of view
• Security issues
• Credit card issues
• Extra expense and expertise for
ecommerce infrastructure
• Needs for expanded reverse logistics
• Sufficient internet service
• Constant upkeep
Gaining confidence
Case of - Hindustan Unilever Ltd (For Lakme )
• Companies warn or debar offenders -
typically on receiving a complaint or if their
“algorithms” flag suspicious behaviour from a particular device, phone
number, email address or locality.
• Flipkart immediately removed all three merchants from its online
marketplace.
Flipkart’s Big Billion Day Sale
• Underrated and underestimated its customers of their intelligence
• Monitor/track prices - Pricify and Chrome extensions like BuyHatke
• Similar to big bazars – Mahabachat / Wednesday bazar?
• Apology letters to the customers
Conclusion
• Types of E-Commerce
• E-tailing
• Marketing
• Valuation
• Acquisitions
• Revenue Generation
• Understanding revenue models
• Impact of E-Commerce
Sources
• ecommercetimes.com
• onlineincometeacher.com
• pwc.in
• paywithpaytm.com
• Fipkart.com
THANK YOU Amulya
Ankit A
Ankit P
Deepashree
Disha
Kavita
Manasa
Nikita
Rohit
Savita
Sufiyaan
Our TEAM

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E commerce

  • 1. E - COMMERCE Presented by FOUR SQUARE
  • 4. 1.Business to Business • Manufacturers selling to distributors and • Wholesalers selling to retailers – Trade india.com 2.Business to Consumer • To the general public • Not limited to just trading • i.e, includes services as well – Ola / Flipkart
  • 5. 3.Consumer to Consumer • Companies review the consumer's requirements and bid on the project – Quickr – E-Bay 4.Consumer to Business • Photographers selling their work to ad agencies
  • 7. E-Tailing Contents • Growth in E-Commerce & E-tailing • Commodity Distribution in E-tailing • Conventional Retail v/s E-tail • Where the products come from • Pricing Structure
  • 8. Growth in E-commerce & E-tailing (In India)
  • 10. Conventional Retail v/s E-tail • Conventional Retail Model • E-tail Model
  • 11. Where the products come from Supply Mechanism 1. List your products • Easy to use self-serve portal • Catalog & photo-shoot partners across India 2. Sell across India • Easy dashboard • Promotions and advertising • Analytics support 3. Ship with ease • Dedicated pick-up service • Packaging support • Pan-India reach Requirement • VAT ID • PAN CARD • BANK ACCOUNT 4. Earn big Fastest payments settlements Lending partner network
  • 16. Marketing Strategies • Focus - to reach the top of search results • Search engine optimization • Pay-per-click marketing • Social media marketing, and display advertising • Better delivery options • Personalized approach • E-mail Newsletters
  • 17. • K.I.S.S. - keep it simple, stupid • Narrow Your Focus • It’s a Mobile Device World • Partnerships Marketing Strategies
  • 19. Comparison with conventional business “Got a great new idea? Are you from IIT? Here's a $5 million cheque” • Flipkart's valuation – over $15 billion (Rs 100,000 crore) • Tata Motors - Rs 95,000 crore. • Hindalco - Rs 16,000 crore • Snapdeal - Rs 35,000 crore • Jet Airways - Rs 3,800 crore • Ola Cabs - Rs 30,000 crore
  • 20. Myths • App-based firms - essentially brokers and couriers. (Ola, Snapdeal, Flipkart, Grofers, Foodpanda) 1. Gross merchandise value (GMV) Not the actual revenue earned 2. Huge discounts - not excluded from GMV.
  • 21. Facts • The real revenue of e-commerce sites is broadly around 5% of their GMV. • No start-up is listed; so scrutiny by financial analysts is limited. • VCs and PEs are betting that sheer volumes will eventually make even five per cent of GMV a big number!
  • 22. Examples • Flipkart - "real" annual revenue of just over Rs 3,000 crore on a GMV of Rs 40,000 crore. i.e 7.5% • Its audited annual loss on account of discounts in 2013-14 was a staggering Rs 719.50 Crore. • But when six-year-old Uber is valued higher than 107-year-old General Motors, we know that a brave new world is already upon us.
  • 25. How Does Whatsapp Make Money • $1 at a time • Other SMS apps • Focusing on growth • Is it really about the money? • The Bottom Line
  • 26. Why 19 Billion $ • By financial metrics, of course not. • Btw, The company employs 52 people!!(Only?)
  • 27. The thinking behind the deal Reason 1. The next billion users Reason 2. The new SMS
  • 28. • Reason 3. To stop anyone else buying it • Reason 4. Face book is now a conglomerate – (Instagram users love Instragram because it isn’t Face book) • Reason 5. Engagement WhatsApp was a warning shot • Combined Face book, Instragram and WhatsApp will bring Zuckerberg close to 2 billion active users. Naturally there will be significant overlap (figures for which haven’t been disclosed), • It grew to 400m users and a $16bn valuation three years after launch. If Face book gets its strategy wrong another rival will likely grow even faster.
  • 30. Do E Commerce sites in India make money • Flipkart Vs Amazon Vs Snapdeal: – Revenues & Losses Comparison
  • 31. • GMV or Gross Merchandize Value represents the price of products sold and net revenues is just a fraction of that! • Flipkart leads the race here to losing 2.23 rupees for every 1 rupee of revenue. Amazon loses 1.90 and Snapdeal has least amount of losses at Rs. 1.72.
  • 32. Ways of earning revenue 1. Pay Per Click Advertising • Pay Per Click (PPC) / cost per click (CPC) • Click-through rate (CTR) You can find PPC adverts for your website at these popular sites: Google AdSense Chitika Clicksor BidVertiser
  • 33. 2. Cost Per Mile Advertising • Instead of getting paid on a per-click basis, you get paid according to the number of impressions (page views) you get. 3. Text Link Ads • Non-intrusive way to monetize. • Sign up to that specific product affiliate advertising scheme. 4. In-text Ads • In-text ads’ are adverts that are placed inside your text content. • The user can then decide if they want to click on it, which will make you a small amount of money. • More obvious than the previous type.
  • 34. 5. Advertising Widgets • Mixture of PPC, text link ads and affiliate programs. 6. Advertising Space • Selling space on your website for advertisers – Facebook allows other companies to post ads 7. RSS Adverts • Google FeedBurner 8. Audio Advertising • Pay per Play (PPP) • Podcast ads • less intrusive • Like commercial breaks
  • 35. 9. Pop-ups/Lightboxes • Indirectly - PopUp Domination • (sign up to our email list) 10. Affiliate Marketing • If they buy, then you get a commission, maybe 10-20% – Check out these great websites that have links to loads of affiliates: • ClickBank • ShareASale • Skimlinks • AffiliateWindow
  • 37. Understanding Revenue Model Contents • PAYTM Revenue model • Customer perspective • Partner Perspective • Transaction fee & Top Merchants
  • 38. PAYTM Revenue Model Advertising Subscription Advance Commission Transaction
  • 39. Customer perspective • Chat messaging(for bargaining) • Easy accessible • Quick payment at paytm • Mobile friendly • Safe and secure payment • RBI approved digital wallet • 45+ banks for net banking.(one of the largest Payment Gateways in India.)
  • 40. Partner perspective • Highest success rate of payment gateway transactions • India's largest Digital Wallet • Amazing User Experience • Wide Range of Payment Options - 0+ net banking options • Simple Payment • Great Dashboard • Awesome conversion
  • 41. Transaction Fee Nature of transaction Charges Loading money into wallet Nil Purchase at merchant site Nil Wallet to wallet transfer Nil Wallet to bank transfer 4%
  • 44. Advantages of E-Commerce 1. Customers Point of View • Convenience • Time saving • Options, options, options • Easy to compare • Easy to find reviews • Coupons and deals 2. Business point of View • Increasing customer base • Rise in sales • 24/7, 365 days • Expand business reach • Recurring payments made easy • Instant transactions
  • 45. Disadvantages of E-Commerce 1. Customers point of view • Privacy and security • Quality • Hidden costs • Delay in receiving goods • Need access to internet • Lack of personal interaction 2. Business Point of view • Security issues • Credit card issues • Extra expense and expertise for ecommerce infrastructure • Needs for expanded reverse logistics • Sufficient internet service • Constant upkeep
  • 46. Gaining confidence Case of - Hindustan Unilever Ltd (For Lakme ) • Companies warn or debar offenders - typically on receiving a complaint or if their “algorithms” flag suspicious behaviour from a particular device, phone number, email address or locality. • Flipkart immediately removed all three merchants from its online marketplace.
  • 47. Flipkart’s Big Billion Day Sale • Underrated and underestimated its customers of their intelligence • Monitor/track prices - Pricify and Chrome extensions like BuyHatke • Similar to big bazars – Mahabachat / Wednesday bazar? • Apology letters to the customers
  • 48. Conclusion • Types of E-Commerce • E-tailing • Marketing • Valuation • Acquisitions • Revenue Generation • Understanding revenue models • Impact of E-Commerce
  • 49. Sources • ecommercetimes.com • onlineincometeacher.com • pwc.in • paywithpaytm.com • Fipkart.com
  • 50. THANK YOU Amulya Ankit A Ankit P Deepashree Disha Kavita Manasa Nikita Rohit Savita Sufiyaan Our TEAM