Online Shopping

Online Shopping

INTRODUCTIONOnline shopping is the process whereby consumers

directly buy goods or services from a seller in real-time, without an intermediary service, over the Internet.

An online shop, eshop, e-store, internet shop, webshop, webstore, online store, or virtual store evokes the physical analogy of buying products or services at a bricks-and-mortar retailer or in a shopping mall.

Online shopping offers B2C as well as B2B services. The largest online retailing corporations are eBay.com and Amazon.com both of which are based in the US.

HISTORYIn 1990, Tim Berners-Lee created the first World

Wide Web server and browser. It opened for commercial use in 1991.

During that same year, Netscape introduced SSL encryption of data transferred online, which has become essential for secure online shopping. 

Also in 1994, the German Company Intershop introduced its first online shopping system.

In 1995, Amazon.com launched its online shopping site, and in 1996 eBay appeared.

GROWTH IN INDIAOnline shopping in India, saw 128% growth in interest

from the consumers in the year 2011 to 2012 in comparison to only 40% growth in 2010 to 2011, making 2012 the tipping point for online shopping in India.

In terms of product categories, consumer interest on Google search for apparels & accessories (30%) emerged as the second biggest product category after consumer electronics (34%) and is expected to become bigger than consumer electronics in 2013 in terms of absolute query volumes.

Other categories that Indians searched for online were Books (15%), Beauty & Personal care (10%), Home & furnishing (6%), Baby products (2%) and Healthcare (3%).

 Rajan Anandan, VP & Managing Director of Google India, said “With approximately 8 million Indians shopping online in 2012, online shopping industry in India is growing rapidly and will continue to see exponential growth. By looking at the trends in 2012, we expect 2013 to be a strong growth year

Situational analysisStrengths• Ability to compete with other

companies global and locally• Specialization and niche

selling• Low overhead cost and low

barrier to entry• Direct consumer

communication

Weaknesses• High Customer Expectations• Search Engine Unpredictability

Opportunities• Global Exposure• High Availability: a 24/7

business• Strong business-to-business

networking• Industry Growth

Threats• Competition• Innovation• Fraud• Privacy Concerns • Future Legislation

Porters 5 force model

Conclusion of porters 5 force model

It is a growing market with competitions increasing day by day even though the initial cost required is high but will have a very good future.

Pest AnalysisPolitical factors

Intellectual property

Taxation

Policing and regulation

Social factors

Privacy

Cultural diversity

Absense of touch and feel

Technical factors

Security issues

Realibility

Bandwidth

Intigration difficulties

Economic

factories

Cost justification

Internet access

Telecommunication infrastructure

Lack of knowledge and

skilled personnel

ISSUESMarket is still very unorganized and

fragmented, most of the bigger online stores are just like a layer over eBay model where the buyer and seller are directly interacting.

Only appeal to net savvy people .

Shockingly, majority of people fails to use netbanking too.

Most of the Indian and international e-commerce players are not complying with e-commerce laws and regulations of India.

CHALLENGESRampant frauds in online space.

Gaining the trust of the customer.

Computing is on pirated software and anti-virus is not updated.

Payment gateway.

Handling customer complaints.

Value chain

Supply chainBased on the type of the Business model the

web site adopts.

Various type of Business Models are as follow:B2BB2CC2C

Bidding Websites (B2B)

Business Firm

Web Portals

Business Firm

Dell Computers (B2C)

ebay.com (C2C)

Web Portal

CustomerCustomer

CASE STUDY

Snapdeal is an e-commerce company based in India.

It is a daily deals' website that features discount offers across lifestyle segments such as dining, health & beauty, entertainment and travel. It also offers discounts on products like electronics, perfumes, watches, bags, sunglasses, coaching classes, apparels and mobile phones.

Headquartered in Delhi, Snapdeal.com was launched in February 2010. The company was founded by Kunal Bahl, a Wharton graduate and Rohit Bansal, alumnus of IIT Delhi who were friends since school.

COMPANY PROFILE

How does ‘snapdeal.com’ earn?

• Snapdeal(SD) gets the best offer possible from the merchants from around 65 cities across India and then deducts a small amount of commission.

• SD aims at showing at least 40-90% off in the deals from what actually one has to pay. Depending upon how good the offer is, SD deducts their commission starting from Rs. 99 going up to Rs. 299.

Snapdeal: PRODUCTS & PRICING For products, SD has a

particular set of commission. The most ideal amount of commission SD charges with selling a product is 23%.

More than 50-60 thousand products are available online for customers to choose from.

SNAPDEAL: GROWTH

In June 2010, Snapdeal.com acquired Bangalore-based group buying site, Grabbon.com for an undisclosed amount.

Snapdeal has been rated the #1 e-commerce site in India, in terms of traction by Dataquest/Sapient E-commerce Survey 2011.

Major changes that will be seen in the eCommerce industry in 2012 and in the coming years:

1. Increase of industries going online

2. Mounting the social media

3. M-Commerce – that will create a new wave

4. Online group buying will start off on a large scale

5. Changes in the business model used by the online stores

6. Hiring the best of people

7. Government policies in the best interest of growth of the eCommerce industry

The eCommerce industry has arrived in India, while it is true that as per the current situation there are some weak links; however with further improvisation in technology they will be ironed out leading to better convenience and security in the eCommerce industry. As of now the use of eCommerce is limited to businesses like electronics, classifieds, travel packages, movie tickets, gaming subscriptions and food delivery; however the trend will soon witness a change with many more industries going online. Although the competition is fierce, but there are signs of consolidation and improvisation in the industry.

Key learningsWill have to make togeather so meet early tomo

in the coll

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