India is presently in the midst of Internet revolution with nearly 243 million citizens using the Internet. The rising Internet and Mobile penetration has phenomenally changed the way we communicate and do business. Though, India is second only to China and USA in terms of number of Internet users; E-commerce in countries like China and USA has clocked an annual sales of about 150 billion USD. India is still in the infancy stage with only 9% of its internet users shopping online. According to one study, India e-commerce is expected to grow form 10 billion USD currently to 43 billion USD in the next five years. This presents a huge opportunity for current players and new entrants. Foreign investors are investing heavily in Indian online players
For example, retailers claimed that Flipkart sold some of the products at price lower than the cost price on the ‘Big Billion Day’ and took up the issue with Competition Commission of India. E-commerce companies should work extensively to form profitable synergies with retailers. The retailers can register themselves with online marketplace and target new geographies. Offline and Online channels should engage in a ‘symbiotic relationship’ to provide a fantastic customer experience.
• Going Mobile – Mobile is will lead to almost 50% of online sales by 2017. Smartphone penetration in country is increasing. E-commerce companies should make their presence felt on mobile phones by offering an engaging app. Focus should be on making very light weight apps since Internet speed is still very low in most parts of the country.
• Scaling up of logistics capabilities – The reach of e-commerce companies is limited because of logistic issues. For example, Flipkart doesn’t ship products to tehsils (semi-urban agglomerations in India) except books. Demand exists in such places and provides a huge opportunity. Though warehouses can’t be built at such places (because of the huge cost involved), a middle path can be followed (illustrated