The E-commerce Industry in India has come
a long way since its early days. The market has matured and new players have
entered the market space. In the present dynamic scenario, e-commerce market in
the B2C space is growing in demand as well as in the array of services. The
transition to online purchasing from traditional purchasing is taking a long
time in the Indian market. E commerce includes not only buying and selling
goods over Internet, but also various business processes within individual
organizations that support the goal. As with e-commerce, e-business (electronic
business) also has a number of different definitions and is used in a number of
The Process used to collect information
& data for the purpose of making business decisions. The methodology may
include publication research, interview surveys & other research techniques
& could include both present & historical information. Research design:
The researcher has used only secondary data that has been collected from
various articles, journals, books, websites etc.
India had an internet user base of about
354 million as of June 2015and is expected to cross 500 million in 2016.
Despite being the second-largest userbase in world, only behind China (650
48% of population), the penetration of e-commerce is low compared to markets
like the United States (266 million, 84%), or France (54 M, 81%), but is
growing at an unprecedented rate, adding around 6 million new entrants every
month. The industry consensus is that growth is
In India, cash on delivery is the most
preferred payment method, accumulating 75% of the retail activities. According
to a study conducted by the Internet and Mobile Association of India, the
e-commerce sector is estimated to reach Rs. 211,005 crore by December 2016. The
study also stated that online travel accounts for 61% of the e-commerce market.
By 2020, India is expected to generate $100 billion online retail revenue out
of which $35 billion will be through fashion e-commerce. Online apparel sales
are set to grow four times in coming years.
OF E COMMERCE
According to a new study from the Center
for Research in Electronic Commerce, it is such a dynamic field. Every day is a
new day in the world of ecommerce. We see a lot of things, and in the near
future, ecommerce will become the industrial revolution of the 21st Century.
Advances in telecommunications and computer
technologies in recent years have made computer networks an integral part of
the economic infrastructure. More and more companies are facilitating
transactions over web. E-commerce provides multiple benefits to the consumers
in form of availability of goods at lower cost, wider choice and saves time.
People can buy goods with a click of mouse button without moving out of their
house or office. Similarly online services such as banking, ticketing
(including airlines, bus, railways), bill payments, hotel booking etc. have
been of tremendous benefit for the customers. Most experts believe that overall
ecommerce will increase exponentially in coming years. Business to business
transactions will represent the largest revenue but online retailing will also
enjoy a drastic growth. Online businesses like financial services, travel,
entertainment, and groceries are all likely to grow.
The growth of e-Commerce in India has had a
very high correlation to the adoption of Internet in the country. India today
Internet user base. Forty million people in India access the Internet from
work, 30 million from Cafes, apart from 11 million households that have a
broadband connection in place. The time an average Indian spends online today
is now on par to TV viewing time at 16 hours in a week. E-Commerce has,
therefore, grown at a fast clip in India. Certain trends, therefore, have become
apparent and these are further fuelling the growth of e-Commerce in India.
PROSPECTS IN E-COMMERCE
A retailer can save his existence by linking his business with the
on-line distribution. By doing so, they can make available much additional
information about various things to the consumers, meet electronic orders and
be in touch with the consumers all the time. Therefore, E-Commerce is a good
OPPORTUNITY FOR WHOLE
In the world of Ecommerce
the existence of the wholesalers is at the greatest risk because the producer
can easily ignore them and sell their goods to the retailers and the consumers.
In such a situation those wholesalers can take advantage of E-Commerce who are
capable of establishing contractors with reputed producers and linking their
business with the on- line.
Producers can take advantages of e-commerce by
linking themselves with on-line, by giving better information about their
products to the other links in the business chain and by a having a brand
As more people are getting linked with
E-commerce, the demand for centre providing internet
facility or cyber cafe is also increasing. Hence, the people who wish to take
advantage of it can establish cyber and have their benefits.
ESSENTIAL FACTORS FOR GROWTH OF E-COMMERCE
Ø Customer convenience: By providing Cash on delivery payment option
service to customers.
Ø Replacement guarantee: Should be Offers 30 day replacement guarantee
to their customers.
Ø Reach: Enabling mobile-capable sites and supporting M-Commerce
Ø Location based services: Since customers these days are always on
the move, promoting the right product at the right time and location becomes an
Ø Multiple payment option: standard credit cards, debit cards and bank
payments option should be there.
Ø Right content: Getting the right content and targeting customers
with crisp and relevant information is of utmost importance to users on the
Ø Price comparison: Providers offering instant price comparison are
highly popular amongst the price conscious customers.
Ø Shipment option: Low cost shipment should be there. The
convenience of collecting orders post work while returning home should be
Ø Logistical challenges: In India, the geographical spread throws
logistical challenges. The kind of products being offered by providers should
determine the logistics planning.
Ø Legal challenges: There should be legal requirement of generating
invoices for online transactions.
Ø Quick Service: Timely service provided by the company.
Ø Terms and condition: T & C should be clear & realistic.
Ø Quality: The product quality should be same as shown on the
Ø Customer care centre: A dedicated 24/7 customer care centre should
CHALLENGES OF E-COMMERCE IN INDIA
E-Commerce, in-spite of the opportunities it
presents also has poses certain challenges which are sometimes too much to
handle for start-ups:
is the backbone of e-commerce. Unfortunately, in India internet penetration is
so far dismally low at 0.5 per cent of the population, penetration of personal
computer (PC) as low as 3.5 per thousand of population and penetration of
telephone only 2.1 per cent of population, ecommerce is not easily reachable
remains to the common man.
Branding & Marketing
get people to come on an e-Commerce site and make a purchase involves heavy
cost due to branding and marketing. This cost is significant and can be brought
down to cost per customer, if the volumes permit to do so. Experts say that the
average figure for this metric in the current e- Commerce ecosystem is between
INR 500 – 1000 customer, which isn’t sustainable for even medium sized
companies, let alone early stage ones.
the introduction of a large number of players in the already competitive
e-commerce market, the customer is pampered by offering huge discounts, offers,
taking returns etc. resulting in less margins.
& Supply Chain
failure in any area can mean detrimental damage to a startup’s future and can
hurt the brand overall. Add to this the need for a guaranteed return policy.
Getting this right is a challenge.
Tax related issues
Tax rate system of Indian market is another
factor for lesser growth rate of E-Commerce in India in comparison to other
developed countries like USA and UK. In those countries, tax rate is uniform
for all sectors whereas tax structure of India varies from sector to sector.
This factor creates accounting problems for the Indian online business companies.
Touch and Feel
customers are more comfortable in buying products physically. Companies dealing
with products like apparel, handicrafts, jewelry have to face challenges to
sell their products as the buyers want to see and touch before they buy these
Future of e-commerce is not easily
predictable but as per the present scenario e-commerce industry is growing very
speedily. There are some essential factors which will contribute to the boom of
the e-commerce industry in India which includes M-Commerce services, multiple payment
options, replacement guarantee, location based services, shipment options and
quick services ,Terms & Conditions should be clear and product quality
should be the same as displayed on the sites. The total number of internet
users is expected to reach 370-400 million by 2016-17. On the behalf of the
study and experts views the future of e-commerce would be very bright in India
if implemented with the all essential factors.