eCommerce in India gaining traction?

eCommerce in india has predominantly been about booking travel tickets (Bus, Rail, Air) online. My view of the Indian market was that, we are more touch-and-feel oriented when it comes to shopping and hence there are only a limited set of items that can be sold online. There were other factors which were affecting the sector: Technology/platforms to support online payments, Online Bank accounts integration, public mistrust towards online purchase (Fear of fraud), Nascent usage of Internet (Indian internet users were more content-consuming, communication and community oriented rather than Commerce oriented)…

Cut to today!

eBay is an online Supermarket selling about 30 Categories of goods…even Jewellery (which is their best category in terms of demand!!)

Flipkart sells books, a whole plethora of electrical and electronic goods, healthcare and even stationery products!

quickr lets you post almost anything online to connect to a potential buyer and vice versa!

There is a growing market for buying and selling second hand stuff! (gears, bikes, even real estate!)

of all the stuff that are sold online, jewellery was the least expected category in India. I would have never guessed that people would look at a picture of jewel set and click to purchase it online!! where was the touch-and-feel hypothesis? Atleast for jewellery dont you have to wear it before you decide? Dont the ladies care anymore to sit for hours in a shop and try out different pendants? How the heck did people just decide to buy a “Gold & Real Diamond Mangal Sutra Pendant” worth more than Rs 150,000  online? What more? you cant even bargain (which is a fundamental indian buyer behavior) online!! The times really are a- changing.

There are 2 recent incidents that tells me that eCommerce in India is here to stay.

A book shop owner near my apartment started making huge profits due to the Pre-University and Engineering college nearby. Each student studying in the institution accounted for thousands of rupees in revenue and every year brought in 500 more students as customers! This shop survived just by selling Engineering text books! Stationery, notebooks, passive reading books and magazines were, for a lack of a better term, a “side-income”. But now, he is on the verge of closing the shop! “Students dont want to even visit my shop anymore. They just go to and find that the same book is available at 30% discount, brand new!! I can NEVER match that, not even with bulk purchases” The amusing part is that, I didnt expect him to know about the existence of the website, let alone check it out and compare prices! This guy has seen the competition and has  declared defeat. He cant survive a few more months of this reduced business… he has to shut down!

We went to a small 10′ X 15′ mobile store to buy a entry level phone, nothing fancy – just within Rs 2000. I knew i could order one from Flipkart, but still went in to check anyway. We bought a Nokia 101 for Rs 1500 (Flipkart has it for 1450). We then needed a Micro SD card and asked the owner for the price of a 16GB one. “Rs 1300” came the reply! I lazily remarked to my wife “we could probably get it from Flipkart at a cheaper price”. I didnt even look at the guy when I said that…after all, what are the chances of a small time shop owner to have known about Flipkart, right?  He immediately remarked ” Okay, I can sell it to you for Rs 700″ !! I was taken aback. Not only does this guy know about Flipkart, he knows enough that it is his competitor and immediately offered a discount… of almost 50%!!! At that moment I didnt know how much exactly I could get from Flipkart and hence didnt buy at the store.  I checked online at home and found that Flipkart sells 16GB SD cards as low as 650Rs!

The Govt is worried about Big-Retail affecting the small shopkeeper? I think it should be as worried about the growing eCommerce world as well!

But then again, we still have a long way to go…To start with, there are only a estimated 10 Million internet users who indulge in eCommerce (and most of these are still ticket bookings). The eCommerce websites arent profitable yet. We still have a whole range of categories to be put online (like packaged Fruit juice, party stuff for example) and the logistics of managing all this is yet to evolve! This is one interesting life-changing domain and I am hooked!


… and a pointer for Flipkart. If there was a phone number i could call to check the price of an item in your store, I could

a) Bargain for a better price with the store dealer (which might not help you) or

b) I might decide on the spot to buy it from you (which helps you)

I am sure there is a customer care number I can call to, but that kind of a service is not marketed enough to people to be taken advantage of!


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