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Changing Consumer Behavior towards e-commerce in India

May 09, 2015

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Page 1: Changing Consumer Behavior towards e-commerce in India

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Changing Consumer Behavior towards

E-commerce in India

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Agenda

•  Indian e-commerce Path to Sustainability & Prosperity: Challenges

& Road Ahead

•  Changing Consumer Behavior & Buying Patterns

•  Opportunities and scope for diversification

•  Segments that will drive growth in next 3-5 years

•  Social & Mobile for faster penetration

•  Opportunity of Facebook for Customer Acquisition in India

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Path to Sustainability & Prosperity •  Lot of momentum behind e-commerce businesses in India over the past

two years.

•  E-commerce in India is currently at about INR 75Bn; expected to grow. Consumer and electronic products makes the large chunk of where the market is.

•  A variety of innovative products and services are being offered spoiling customers for choice.

•  The growth of e-commerce industry in India has been phenomenal as more shoppers have started discovering the benefits of using this platform.

•  There is enough scope for online businesses in the future if they understand the Indian shopper’s psyche and cater to their needs.

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•  Travel is the largest category in India, followed by consumer electronics

and apparel.

•  The e-commerce market in India is smaller than in other markets that

Forrester forecasts in Asia, but it is fastest growing.

•  Over the past 12 months, VCs have invested heavily in Indian e-

commerce market, new players have emerged, and the e-commerce

ecosystem has developed. Huge opportunity for companies willing to

work through key logistics and payments challenges in India.

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Challenges

•  The Profitability Challenge

•  The Financial Challenge

•  The Differentiation Challenge

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Growth Drivers

• Payment option • Merchant Push

• Logistical Challenges • Quality of Net Access

• Household Income

• Online Tenure

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Road Ahead

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Growth Ahead

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Growth Ahead

• Today's Online Shopper In India Has Inflated Expectations

Online shoppers expect to see good deals online accompanied by free or

very low-cost shipping.

• Localization is Crucial

Two key areas that companies must focus on in all markets -- localized

payment and fulfillment options -- are particularly essential in India.

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Consumer Behavior & Buying Pattern

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Consumer Behavior & Buying Pattern

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Poised for Rapid Growth E-commerce revenues in India will increase by more than five times by 2016,

jumping from US$1.6 billion in 2012 to US$8.8 billion in 2016. The following

factors are influencing this growth:

• VCs are bullish on e-commerce growth

• Online grocery shopping is starting to appeal to the upper- and middle-

class consumer

• E-commerce is expanding into non metros

• Large retailers are looking to build their online presence

• Social Media and Mobile are helping accelerate e-commerce adoption

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Social & Mobile

•  Mobile internet will play a larger role in Market like India; fundamental

behavior of what people will be transacting from Mobile will be different

from what they are transacting on the ecommerce site. It will play

important role not only as a transactional channel but also enabler of

offline retail.

•  Online retail has seen a heavy overlap with Social Networking and Search

due to aggressive marketing and strong inclination towards Social

Commerce.

•  Expect a larger portion of online retail from Social Commerce with India

positioning itself as one of the fastest growing Social Networked user

base.

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Opportunity of Facebook Marketing

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“Only 20% of marketing budgets are typically spent on retention.

Yet, in many cases, 75% of revenues comes from existing

customers.” Source: Flip the Funnel

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Customer Acquisition

Influence Lead Sale

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Time Has Not Changed

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You were expected to have a Website.

You were expected to have a Blog.

You are expected to have a Facebook

Page.

Hits (2000) > Likes (2010)

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# of Fans: Currency for Success!

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Quiz Time!

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Facebook Edge Rank

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Let’s look at few Case Studies

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25% Revenue through Facebook

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25% of Online Revenue through Facebook

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Over 20% All Sales through Facebook

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INR 1.5 Million Revenue/Month

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30x ROI on FB Ads: 10k+ Tickets Sold

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Page 29: Changing Consumer Behavior towards e-commerce in India

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