Perspective | E-Commerce - prospects, issues and challenges

With a current estimated internet users base of 122 million in India which is expected to nearly triple to 350 million, India is in the midst of an e-commerce revolution. Enhanced exposure to internet amongst Indians has definitely impacted the Indian e-commerce ecosystem. The e-retail industry is about $ 2-3 billion at the moment as compared to $ 50-80 billion in China and well over $ 150 billion in the US. There is no doubt that the scope for the e-commerce industry in India to develop is immense, as also for the budding entrepreneurial talent to grow. But at the same time the industry faces a number of challenges.

So how are the opportunities for e-commerce and what needs to be done to overcome the various challenges that the industry faces? In an exclusive feature, Adgully sought to find answers to a myriad of these questions and spoke to a number of players in the  e-commerce space to find out the road ahead for the industry. In this two part exclusive, present here is the first part that essentially talks about the opportunities in the e-commerce space, what the companies in this space need to do to stand out amongst the clutter and to build customer traffic & thereby loyalty.

India has all the pre-requisites for e-commerce, they are fast getting established and we are certainly in the midst of an e-commerce revolution. For example broadband penetration is beginning to take off. Says Rajesh Iyer, Chief Marketing Officer,, “Internet consumption has gone beyond from seeking information and is now co-related to several lifestyle needs of the customer whether it’s booking tickets or watching a live stream of a cricket match and customers shopping online are future confident with great disposable income. All these augur well for the growth of ecommerce in India which has experienced high growth in the last few years. The best is yet to come.”

Furthermore traffic congestion, crowded retail infrastructure and quick adoption of online shopping by the younger population will further fuel the demand for products and services available online. Adds Ankur Mehrotra, Managing Director, Delivery On, “Consumer today looks out for convenience as he is short of time and wants to reach his search results faster, exploring a website is always easier than exploring a physical store. Smart phones and mobile application will add more value towards this and search on the go will make consumer buying more convenient.”

Giving a different perspective, Nikita Bhargav, Creative Director, says “From the happening cities to the quiet corners of the country, people revel in this opportunity to erase physical and geographic limitations when it comes to catching up with the trend. And this shift in shopping pattern is in steady acceleration.” There is no doubt about several more changes in the industry and how consumer buys. With the move towards the mobile applications a new field, buying spree would flow in.

While all these augur well for the growth of ecommerce in India, there are a few things that need to be taken care of. Says Shipra Jain, Chief Merchandising Officer,, “E-commerce players are still struggling with operations and customer service needs to be stabilized with time. Consolidation of the industry would be the next phase where the incompetent players would be weeded out.”

A key factor in ensuring success to any business - new or established is efficient customer service. The e-commerce industry too is not an exception to this. Operational efficiency is very important to stay ahead of the curve. One needs to lead new customers to the site and also make sure that the existing customer base stays satisfied with all aspects of online shopping.
Offering wide variety at great value is definitely a win-win. Variety has two aspects: width and depth and it’s important for an e-commerce site to offer both to claim true variety. For instance a site may offer products across a spectrum of categories but range in each may be limited or a site may offer a wide range of products but play in a limited set of categories. The ability therefore to showcase uncompromising variety backed by great value, supported by great customer experience and policies will make a difference.  It’s about doing the simple things right the first time and then every time.

Citing an example, Ashutosh Lawania, Co-Founder and Head, Sales & Marketing says, “What differentiates Myntra from others is the wide catalogue of lifestyle products that are available on our website. We offer over 30,000 products from more than 500 national and international brands. We are also the first e-commerce platform to offer current season, full catalogue of footwear, apparel and merchandize at MRP. We also lay great emphasis on the customer experience and ensure that from the time a shopper visits our portal, till the time they receive their order, the experience is hassle free.

According to Prashant Tandon, MD and co-Founder,, “The standout companies would deliver some exceptional value – they have to solve a consumer need in a manner that is clear and differentiated. It will all boil down to the strength of operations, the innovation in business models and processes and the ability to attract and retain quality customers. Also, strong companies will have solid vendor partnerships and supply systems – it is important to create value for your partners as well as you to succeed together.”

Agrees Rajesh Nahar, CEO & Co- Founder, Cbazaar, “No mee-too online player can survive for long. There are many players in same genre. Do something that is different. If a website does not have a unique positioning and differentiation factors vis-a-vis their competition then it becomes difficult to build the brand identity and these sort of website do not survive in the longer run.”

Says Manish Chopra, CEO,, “there are two forces at play currently- the proliferation of undifferentiated me-too e-commerce models and the growth of online savvy customer base. AN example is THE Fashion category which offers the unique opportunity of being mass in appeal yet individualistic in selection thereby leveraging the advantage of being online by offering a single storefront to all but being able to customise the experience at an individual level.  Brands that understand the online audience well enough to provide a differentiated shopping experience, have significant potential to stand out and grow with the online customer base.”

So what should e-commerce companies do to build customer traffic and loyalty?

To generate traffic in short term is comparatively very easy through the available digital marketing mediums today. There are various means to generate enough traffic, thanks to all the social media tools today like Facebook, Pinterest, Twitter etc.

Agrees Shipra Jain, “These mediums have become an effective communication channel for building customer traffic.  However to build a long term customer loyalty the product, operations and customer service is a must.” Providing a valuable insight Ankur Mehrotra adds, “Consumer loyalty is what all e-commerce companies look out for, but in the foray we are missing, that the purchase is on the discount not on the web portal. A retailer in the local market has more loyal customers, still offering no discounts, consumer knows the retailer in his local market and still prefers to buy from him.”

E-commerce sites should be designed in a very user friendly way, with clear navigation and checkout. Also, the product range, descriptions, images and pricing should be compelling enough to drive a purchase. “Thereafter, you need to delight the customer with high quality and quick delivery systems. Also, you must implement analytics based CRM systems to drive repeat purchase from the consumers leveraging the learning you already have about that consumer based on his/ her pervious transaction,” says Prashant Tandon.

Meeting customer expectations in terms of service, product quality, look and feel are the key to gaining customer loyalty, feels Manish Chopra. Avers Rajesh Nahar, “In India offline too play an important role in building the trust factor of an online business. Therefore many companies spend aggressively on television, radio and other offline mediums too.”

Therefore while online marketing is certainly the most efficient and effective way for a site to build traffic as one is focusing on customers who are internet savvy; outside of marketing optimized SEO efforts is very important to drive organic traffic to the site which leads to trial generation. One cannot undermine the customer retention efforts thereafter, engaging them through effective merchandising, promotions and great customer experience. Offline promotions also aid in optimizing online marketing efforts of an ecommerce. Customer loyalty eventually happens after all these efforts are consistently met.

Watch out for the concluding part of this exclusive feature on e-commerce tomorrow…


News in the domain of Advertising, Marketing, Media and Business of Entertainment

More in Media

Get daily Newletter from
Stay updated with the latest News in Advertising, Media, Marketing and Entertainment.
CAPTCHA ImageRefresh Image