e commerce from india context

E-Commerce from India Context

Presented by: Elamurugu SundararajTitle: DirectorCompany: Raj Competency Development CenterWebsite: http://www.rcdc.co.in

Contents

Types of E-CommercePopulation SpreadInternet UsageUsage ClassificationMarket SpreadThe Future – Pushing and Limiting Factors

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Types of E-Commerce

Definition: 1. Commercial transaction through a network

enabled medium is known as Electronic Commerce.

2. E-commerce is the use of electronic communications and digital information processing technology in business transactions to create, transform, and redefine relationships for value creation between or among organizations, and between organizations and individuals.


Types of E-Commerce• B2B: Business buying products / services from another business. Example:

Manufacturing units to Dealers• B2C: Consumer buying products / services from Business. This form is

becoming popular now after amazing success by Flipkart, Amazon etc• C2B (Consumer-to-Business) Consumers directly posting or publishing

requirements in a network medium and the business bid for it. Example: Furniture requirement postings, Home purchase etc.

• C2C: Consumer buying products / services from another consumer. Classifieds business for example, will fall into this category. Companies like MyHome-MyNeeds.com are operating in this business space.

• M-Commerce: Mobile Commerce is the niche market which further facilitates the commercial transaction on the fly, since the business is done thru hand-held devices with wireless network. This takes all the above formats. People say it is a subset of e-commerce.


http://www.myhome-myneeds.com/

Government Participation

• B2G: Government Tenders, Auction Notices are digitalized and business bid for them. This can bring transparency in Order Selection and Execution.

• C2G: Government can directly reach citizen without any middlemen or offices to disperse its schemes, subsidiesm etc.


Population Spread As we look at the geo-spread,

nearly 8% of India population, with each 5million people are living in the tier1 cities and much of e-commerce transactions happening here.

Approximately around 4% of population from 32 cities, with an average of 2.5 million each are participating in this market.

That sums up to the range of 25% to 30% of 1.2 billion people who are the active customers in e-commerce space.


This is the census data as of 2011 and geo analysis done by Forester Research.

Internet Usage


As we see the present and projected and planned usage is getting increased by multi-fold.

As per the projection given by TRAI, by 2020, there will be an estimated internet users of 600 million with minimum of 2MBPS data speed. This target seems to be quite realistic with the advent of 4G in place.

Internet Usage Classification


People get into internet for various purposes - Entertainment, to play games, listen to music

or movies etc To communicate with others, be it text chat or

video chat or send mails etc To avail any online services such as scheduling

appointment or to use Government services and schemes etc

Here comes the next big thing - eCommerce. As we look at the data, the % of current usage and the estimated future usage for commercial transactio is more than 60%. But the reality has surpassed all estimates and is now more than 100%.

People use it for Social Networking like Facebook, Twitter etc

To avail and record for Financial purposes like tax paying, Insurance claim, Utility Bill pay etc

Other important sector, which could be the next major sector is about integrating and addressing all Rural needs such as Agri, loans, subsidies etc. Since this works out at the municipal or rural level, government initiatives are already underway.

Market Spread Today, online ticket booking is the

major sector in eCommerce, which takes the lion share of 71% from overall market primarily because of time saving, convenience to search, compare and reserve, friendly cancellation policies, acceptance of e-tickets by operators, associated or add-on facilities like hotel booking etc make this segment more attractive.

The next major segment is eTailing. Online product purchase is fast picking up.

6% of online eCommerce users use it for Tax filing, Insurance, Share trading, utility bill pay and banking etc

The classifieds business takes the next big share from this market.

Miscellaneous services like scheduling appointment, government schemes etc takes remaining portion of it..


The Future - AdvantagesAdvantages of E-Commerce

– Reduction of transaction costs such as:• Logistics• Intermediaries

– No Queue and No wait time– Elimination of trade barrier, location divide.– Price Consolidation. Since the buyers can cost compare,

the price variation will come down significantly.– Employment Generation– Government Initiatives


The Future - ChallengesConsumer perspective:• Credibility as the market is yet to mature. This problem is more

acute in service sector due to reliability of people.• No defined or systematic way for product returns or payment

refunds in case of defects.Business perspective:• Availability of skilled resources and high attrition rate• Risk of fraud and cyber issues• Order fulfillment• Cost of Advertisement or Reach is high with the thin margin.

This poses threat on Business scale-up and sustenance issues.


Conclusion• Both planned and ad-hoc purchases make this segment lucrative. Convenience of

order booking at one place and deliver at another place without worrying on logistics, package and time (the Gift sector, for example) make this market further attractive.

• Accelerated usage of Smart phones, gradual adoption or transition of pay wallets, for example paytm.com, e-money will trigger this market move upwards.

• Vast amount of data getting generated on the consumer preference and spend power which in turn opens up other niche business segments such as Analytics using BigData etc.

• Warehouses will be much more decentralized. The inventory control might become a challenge due to demand volatility and competition pressure.

• As the usage becomes more common and awareness increases, the businesses will be interfacing with one another through tested API’s so as to provide an integrated shopping experience.


Thank You

Presented by: Elamurugu SundararajTitle: DirectorCompany: Raj Competency Development CenterWebsite: http://www.rcdc.co.in