Smaller towns and rural areas driving e-commerce in India, reveals eBay census

eBay, one of the leading e-commerce marketplace in the country, today unveiled the eBay census that provides insights into the online buying and selling behaviour of the consumers based on the transactions. The fifth eBay census takes into account the online transactions on the site from July 1, 2011 to December 31, 2012. 

One of the key trends observed this year is what is being termed as "massification" of e-commerce as online shopping is now truly mainstream and nationwide phenomenon. India registered a healthy 30 percent rise over last year’s census when it came to number of cities and towns engaging in e-commerce. Out of the 4,306 e-commerce hubs, 3,281 are the so called Bharat hubs (smaller towns) and 1,015 rural hubs, while the rest were the metros. 

Maharashtra emerged the leader when it came to states, while it was Delhi that took the crown as the number one e-commerce hub in the country. Mumbai came in second, followed by Jaipur, Bengaluru and Chennai. On the other hand, Andhra Pradesh topped the list as the state with the most number of e-commerce hubs, closely followed by Tamil Nadu. In terms of rural hubs, Guntur (Andhra Pradesh), Choryasi (Gujarat), Kartikapall (Kerala), Villupuram (Tamil Nadu) and Dindori (Maharashtra), emerged as the top five e-commerce hubs in the country.

Abhimanyu Lal, Head-Category Management, eBay India, sharing key findings 

Electronics continue to be the number one category driving transactions and contributes to 48 percent of domestic transactions, but what’s also increasingly gaining traction is the lifestyle category at 41 percent. Under electronics, it’s the smartphones, mobile accessories, tablets and laptop accessories that drive sales when it comes to trading within the country. And people seem to be importing smartphones and mobile phone cases as well. When it comes to the exports – natural diamonds, fashion necklaces, herbal remedies, sarees and gardening supplies ruled the roost. While the rural areas exported lifestyle products, what they shopped for was electronics, especially smartphones, Bluetooth, tablets and interestingly, they imported solar energy panels. Coming to the brands, it was Samsung that emerged as the clear leader followed by Apple, while Sony and Nokia, which were leaders last census, took up third and fourth position respectively. 

The census also revealed a growth in m-commerce; out of the $67 billion online transactions in 2012 world over, mobile transactions constituted for nearly $13 billion. While the figures have been encouraging and they believe m-commerce will rise in the coming years, Abhimanyu Lal, Head – Category Management, eBay India, says that their focus currently isn’t on mobile transactions. He says, “eBay has been present on the mobile platform from 2010, in the form of both mobile site as well as apps. But we are focusing on getting our offering out there and not the transactions. Way we look at it today is in terms of traffic, what we find is that people are using it to basically check prices. We are not trying to drive transactions on the mobile platform, in fact in some of our apps we haven’t enabled the buy option, and it’s designed as a price check option.”

He states further, “It’s really about behaviour change, how do you encourage people to use these things. It’s simplistic to say that if I have the app then I will get the business, but really what we are talking about is changing people’s ways. What this is helping us do is that it is helping us understand that behaviour and how the ecosystem is working like what are the things they look for using this platform, when does the traffic come, etc. So we are in the process of understanding the behaviour at the moment. But yes, m-commerce is bound to grow.”

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The Future Of E-Commerce For Small Businesses

The future of e-commerce looks promising for small businesses. Let’s take a closer look at how independent merchants can continue to sell more and stand out in competition with big-box retailers who also have moved online.

Consumers are adopting new technologies quicker than ever. According to a recent study by Pew Internet Research, nearly half of all Americans now own a smartphone. That’s a 28.5 percent increase versus 2011 – and the market still has great potential for growth. A recent study from comScore also found that 86 million Americans are using their smartphones to shop online.

The major shortcoming with online shopping to date has been the instant gratification that comes with in-store shopping and the ease with which consumers can get their hands on products in real time. As new technologies such as Near Field Communications emerge, that advantage for traditional retailing may shift.

NFC is a smartphone technology that allows for easy communication and data transfer over short distances. By connecting NFC-enabled devices to a credit or debit card, paying for goods or services is simpler and faster than ever before. Imagine simply waving your phone over a product to purchase it online.

That kind of transaction has the chance to be a real game-changer in the e-commerce space. By 2022, brick and mortar retail spaces will be little more than showrooms. Instead of loading up a cart with goods to purchase in store, consumers will try on or sample the products in store, quickly scan and purchase the items they desire, and have them delivered to their homes within 24 hours. The shopping mall as we know it today will be much different 10 years from now.

Does this mean brick and mortar stores are dead or dying? No. They’re simply evolving as consumers find new technologies that simplify their lives. The challenge for businesses going forward, large or small, is adapting to this change in consumer behavior or even predicting it.

So where should small business be focusing their efforts so they’re not tripped up by the next disruptive technology?

• Invest in mobile: Consumers can now shop anywhere at any time, whether from their PC, smartphone or tablet. IBM’s Digital Analytics Benchmark survey recently showed that online shopping on Thanksgiving and Black Friday was up over 14 percent versus 2011, with 24 percent of consumers using a mobile device to visit a retailer’s site. On Cyber Monday alone, purchases made from mobile devices accounted for 13 percent of all online purchases. International Data Corp. has predicted that by 2015 mobile web usage will actually outpace PC web use. With the smartphone and tablet markets continuing to grow, it is safe to say that in order to be competitive in the online retail space, an app or a mobile website is a must-have. At the very least, make sure an existing website is optimized for mobile.
• Video content: The impact of social media in business is indisputable at this point. For consumer-facing companies, especially online retailers, an active social media presence is essential to maintaining a core consumer base and quickly marketing your store. Small online retailers need to take efforts a step further and start leveraging the power of online videos to sell more. In the past, text updates and photos were sufficient to drive traffic to your online store, but video offers unique opportunities. The opportunity to develop video content (which includes little cost outside of time and some basic video editing software) is too big to ignore.
• Social advertising: Many small businesses are still trying to understand how best to deliver content to their customers via their social media channels while also reaching new prospects. Advertising on social channels like Facebook and Twitter can be that bridge to a new frontier. While there is some debate about the overall value of social advertising, it is hard to argue that it offers some of the best targeting available to business owners; especially when the amount of time U.S. consumers spend on social media sites on a daily basis is taken into consideration.
• Digital couponing: It was only a matter of time before large stacks of coupons got replaced with something digital and eco-friendly. A recent report presented by comScore found that digital coupons were seen as the number one method of savings for consumers. The same report also showed that 35 percent of respondents found that digital coupons “helped with new ideas,” essentially the discovery of something they didn’t know they even wanted to purchase. Over one-third of those surveyed indicated that they actually prefer receiving coupons online versus any other format.

So what does the future of e-commerce look like for small businesses? Smarter, faster and more promising.

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The Essential Elements of Building an E-Commerce Website

If you plan to sell anything online, having an e-commerce plan is as important as your original business plan.

The first step in writing an e-business plan is to decide what kind of experience you want your online customers to have. Think not only about today but also two and five years down the road.

Your e-commerce plans starts with website goals. Who are your target customers? What do they need? Are they getting information only, or can they buy products at your site? These key questions, asked and answered early, will determine how much time and money you'll need to develop and maintain an online presence.

Second, decide what products or services you will offer. How will you position and display them? Will you offer both online and offline purchasing? How will you handle shipping and returns?

Additionally, don't overlook the customer's need to reach a live person. A toll-free phone number should be prominently displayed that customers can call anytime to get their questions answered by a live person.

If you decide to sell online, you'll need a shopping cart component, which is a means of handling credit card processing, and an organized order fulfillment process.

Finally, even if you build an amazing website, don't assume people will find you on their own. If you want to develop a consistent flow of traffic to your site, it's essential that you plan and maintain an ongoing and multifaceted promotional strategy that's carefully targeted to your audience.

Once you've decided to have a website, one of your first 'to-do' items is to make a list of possible website names or URLs.

Then run, don't walk, to the nearest computer, log on to the internet, go to your favorite search engine, and type in "domain registration." You will find a list of companies, such as networksolutions.com, godaddy.com and register.com, that will guide you through the simple domain registration process.

For a modest fee ($8 to $75), you can register a domain name for one or more years.

From the available names, choose one that's easy to spell and remember, and describes what your company does. Make sure, however, you're not imposing on someone else's trademark or copyrighted name. In many cases, the name of your company, with the addition of dot-com (www.[YourCompanyName].com) is a suitable domain name that you should definitely register.

Once you've registered your domain name and have a plan in place for what you want to offer prospective and existing customers online, the next major challenge is designing and building your actual website and online presence.

What makes a good website? Before getting enmeshed in design details get the big picture by writing a site outline. The content you develop and publish should directly relate to and help you achieve the goals and objectives you've set for the website.

A well-thought-out site outline includes:

Content. The key to a successful site is content. Give site visitors lots of interesting information, incentives to visit and buy, and ways to contact you. Once your site is up and running, continually update and add fresh content to keep people coming back.

Structure. Decide how many pages to have and how they'll be linked to each other. Choose graphics and icons that enhance the content.

Design. With the content and structure in place, site design comes next. Whether you're using an outside designer or doing it yourself, concentrate on simplicity, readability and consistency. Remember to focus on what you want to accomplish.

Navigation. Make it easy and enjoyable for visitors to browse the site. For example, use no more than two or three links to major areas and never leave visitors at a dead end.

Credibility. This is an issue that shouldn't be lost in the bells and whistles of establishing a website. Your site should reach out to every visitor, telling that person why he or she should buy your product or your service. It should look very professional, and give potential customers the same feeling of confidence they would get with a phone call or face-to-face visit with you. Remind visitors that you don't exist only in cyberspace. Your company's full contact information -- company name, complete address, telephone, fax and e-mail -- should appear on all or most of your individual web pages and be displayed prominently on your site's home page.

An outline helps you get the most out of your website design/e-commerce budget. It will also help you determine whether you, or someone in your company, can design portions of the website, or if you need to solicit outside help. That way, when you hire someone, it will be for only the parts of the job that you'll need to have outsourced.

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How shopping trend in 2012 has changed!

Year  2012 has seen significant growth in online shopping and mobile shopping in India. According to Google research data online shopping has seen a growth of 128% in year 2012 compared to 40% in 2011. Also the number of shopping queries through mobile has sought up to 2X accounting 30% of queries received for online shopping is through Mobile.

With the help of Google trends and research conducted by TNS Australia where they have taken survey of respondents from major cities of nation including cities like Delhi, Mumbai, Bangalore, Kolkata, Pune, Ahmedabad, Hyderabad & others keeping a sample size of 800 with an average monthly income of 50K.

Some facts from the study

• 200% growth in the shopping queries received from mobiles accounting more than one fourth of total shopping queries received in India.
• Consumer electronics, Apparels & Accessories and  Books generated the maximum online shopping queries totaling over three fourth of total queries. others in the list were: Beauty & Personnel care, Home & Furnishing, Baby Products, Healthcare, etc.
• Looking from the buying behavior perspective, Apparel & Accessories category topped the list with more than 80% respondents. Successive categories in the list are Consumer Electronics, Beauty & Personnel care, Books, Household Products, Baby Products and Health & nutrition relatively from highest to lowest figures.
• Apparel & accessories category also topped the list in repeat purchase criteria of study. This category has seen most repeat buyers than all the other categories making this category most profitable.
• One more fact was that the consumers who buy online tickets are likely spend more on the online shopping averaging double than what first time online buyers spend.
• Another most Important result for the online retailers is that more than 75% buyers opt for Cash on Delivery as payment option compared to Debit cards & Credit cards.

Summary from Great Online Shopping Festival

In the last month of 2012 Google organized a 24 hour online shopping festival called Great Online Shopping Festival, where around 90 well known eCommerce players of India participated in the event. The main aim of the festival was to spread awareness about online shopping. Google nearly achieved its aim as most of the participants witnessed significant impact on the traffic of the website as well as on the sales. Some of them reported that they went out of stock for their products which were listed for GOSF in the first half of the event. As this was the first year of the event Google didn’t go with all gun blazing for the marketing as they kept it only to the online marketing but learning from their first year success & experience Google may plan for a much bigger event next year.

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Few facts about online buyer’s behavior and impact of it on a webstore.

Over the past few years after studying so many e-commerce sites  we have collected a valuable data on customer behavior . The data has surprised us all and we decided to put together all the information in a graphics to explain the behavior.

What are some of the most surprising trends we noticed?

• High priced products earn more profit.
• Mostly users share positive opinion than negative.
• Customer never writes a review at the time of buying.

In the article we will we will drill down what does these trends mean to store owners.

High priced products earn more profit.

This one is somewhat counter-intuitive: online, cheaper isn’t always better. It seems there is a correlation between how expensive a store’s products are and how much that store is likely to sell. Across the sites it has been seen that site that sell products with higher price are likely to earn more profits but the catch is that too high a price also lowers the sell.

What does it mean for your store?
If you’re a shop owner, this means you may want to focus on selling more unique — and possibly more high-end — products. Make sure your products stand out from the crowd. Don’t worry if it costs you more to make something of high quality — your shoppers will reward you for it!

Mostly users share positive opinion than negative.

Turns out that the adage “everyone’s a critic” doesn’t hold true for online shopping. The data shows that shoppers are much more likely to talk about products they love rather than products they hate. Five-star reviews are shared across social networks 85 times more than one-star reviews.

What does it mean for your store?
This is pretty great news for online merchants. If people are more likely to talk about a product they love, then you don’t have to worry so much about negative reviews. People aren’t as likely to spread these. This means you can feel free to put up a product you’re not sure people are going to love. Take chances!

Customer never writes a review at the time of buying.

On Saturday, the amount of purchases shoppers make drops significantly. But at the same time, people leave more reviews on Saturday than they do on any other day. Why does this happen? Maybe people only get to try their new products over the weekend, so they end up writing about them then.

What does it mean for your store?
Knowing that shoppers are more likely to leave reviews over the weekend lets you tailor your incentives to increase both reviews and sales. Offer a coupon, valid only during the week, for any review that is left on a Saturday.

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