The budding internet economy along with the increasing smartphone penetration in social media engagement has changed the entire dynamics of India’s e-commerce industry. According to a recent joint study by Assocham and Deloitte, the Indian e-commerce industry is set to cross the $16-billion mark by the end of this year.
This rapid growth in the digital market has been fuelled by greater customer choice and improved convenience. The buyers now enjoy the ease of having numerous products to select from, which are just a click away. And, with over 250 million internet users and these numbers increasing rapidly, e-commerce players are espousing newer techniques to facilitate efficient online selling and buying. Over the years, dozens of websites have been launched in India—to sell everything from books and appliances, to baby-care products and flight tickets.
E-commerce platforms are going all out to woo the young Indian mobile consumer. The bottom line is that, with the growing number of consumers using smartphones, e-commerce companies have to integrate technologies to enhance both the user interface and user experience for the discerning users.
Initially, the e-commerce market started with an inventory-led model, one of the primary goals of which was to earn the trust of the potential customers. This meant they had to be involved at every step, till the product was in the hands of the consumer. The companies were hands on, to take care of the buyer’s purchasing to post-purchasing experience. The cost of running the business in this model was steep and the revenue generated was bare minimum.
Gradually, the e-commerce industry switched from the inventory-led model to the managed-marketplace model. The model has facilitated a platform for buyers and sellers to meet and carry out business. This model has fostered a wider shopping experience with an array of products for the buyers. Marketplace business models are profitable, scalable and highly valued.
The managed-marketplace model has been successful in providing greater operational efficiency, as some of overheads are transferred to the seller. It also makes sure there are no stress factors related to operations, such as risk of inventory, warehousing and sourcing. This gives scope to the companies to focus on new e-commerce technologies.
The online marketplace is becoming a hunting ground for the best deals, with various multinational and Indian e-commerce giants going the extra mile to offer the best prices to their customers.
Switching to the managed-market place model has revolutionised the e-commerce industry. While right now it is still a kind of hybrid model—as not all operations are on managed-marketplace, and a lot of company activities are conducted the traditional way—but it is just a matter of time before the e-commerce companies completely transform their operations onto the managed-marketplace model.
Enhancing the shopping experience of a buyer has been the focal point in the e-business industry. Coming up with a fresh approach is the name of the game. Following up on new technologies, the e-commerce companies have adopted the omni-channel approach. This approach integrates all sales channels in order to give the buyers an enjoyable and seamless shopping experience. The approach primarily focuses on the customers’ wants and needs and provides them with instant and relevant information, no matter where they are or what device they are using. It also helps retailers increase customer retention and brand loyalty, not only online but offline as well.
Going forward, the omni-channel approach not only presents a significant shift in how we think about retail, but will also provide the e-commerce industry an opportunity to lure the customer with a hunting ground for the best deals.
The author is group CMO & head, Digital Strategy, Askme.com