Surviving the Indian eCommerce Boom (or Bubble)

What is the mantra for surviving the e-commerce boom in India? With multiple websites starting daily, what would separate the real players from "just another player". Online shopping portal shares early trends in Indian e-commerce space.

Mumbai, India (prHWY.com) August 25, 2011 - The Indian eCommerce have apparently been going through one of its best phase. There is visible optimism about the growth story, crazy valuations, Amazon entering the market soon, the FlipKart Story, SnapDeal boom. I have met atleast 10 people who have told me that they are thinking to start an eCommerce venture soon.. And yeah, everyone has started to think that they can make some quick bucks with the dot-com boom. So much optimism is inspirational but will everyone survive the bubble?

We, at DesiDime (http://www.desidime.com/) collect a lot of data on what do the buying community like to purchase, what deals they click or view the most and which stores are effective with their marketing strategies, order fulfillment and customer service. While the e-commerce boom is certainly a reality, I often wonder if the growth is as much as it is made out to be. The mantra seems to be simple with newer firms: get VC funding, throw those funds around at marketing (read: coupons and jaw dropping deals) to generate more traffic, get more funding and rinse, wash and repeat. But are coupons a viable option for customer acquisition? Is generating a traffic spike enough to be labelled as a "Successful venture"?

Here are some of the things we feel will make a huge difference between the real players and players just riding the bubble:

1. Customer Service

I have been guilty of reading almost each and every comment on our forum and the first and foremost thing that separates the real players is their Customer Service. Taking customers for granted is a sure way to failure, no matter how many new leads you generate every day. Some of the big names (read BIG in other verticals) have received horrible ratings from the community for their exorbitant shipping charges, unrealistic shipping delays or for simply sending fake products or less quantity that what has been mentioned on the website. Sadly but surprisingly, such things still happens in the Indian eCommerce space.

On the other hand, the real players treats their customers very well. Simple gestures like speedy shipments, resolving customers issues quickly, no charges for Cash on delivery, sending a thank you note or a free gift brings in a lot of goodwill. Ever heard about success of Amazon? And their customer service? You can draw a parallel there.

2. Technology

If you dont build your product technology back-end well, you will lose customers quicker than you would anticipate. Very few would be interested to save few bucks on a shopping website that is extremely slow or do not do the basics right. Naman on Pluggd.in rightly mentioned, about Flipkart's payment management (a simple but effective step)

a. Auto redirection to banking site: Unlike most other ecommerce sites, Flipkart never lands you on CCavenue page, you are auto redirected to the banks page where the info is required to be filled. Flipkart by-passes 1 unnecessary page by passing the required parameters directly to CCavenue and not through a user interface.

b. Banks Status: Flipkart maintains its own real time status if the bank's netbanking is working or not. So there are no surprises after you have chosen the bank and then go to the netbanking page.

We have seen many times where customers have simply given up ordering since the site was slow or because one was not able to update their cart in some particular browser. You cannot be a real player if you have such bugs right on the page where the customer is ready to give you an order. What is the point of spending bucks on customer acquisition then? We have also seen instances of sites crashing due to moderate load for an offer on a pendrive. You must not spend big on marketing when your website is not yet ready to handle traffic spikes.

3. Price Mistakes/Content Management

Price mistakes could be simply human error and cannot be always avoided. However, a process or system can be built which minimizes such human errors. Honoring price mistakes is a debatable issue and customers will understand if there was a genuine price mistake which simply cannot be honored. However, FutureBazaar for example, had even honored a price mistake of 50k refrigerator delivered for 5k. The mistake would seem genuine(a missing digit) and legally, the company is not always obliged to deliver such orders but honoring such price mistakes also speaks volumes about the ethics of the company.

However, not working on building a process to avoid such price mistakes, shows that your company does not care about the customers and the order cancellation process and refund process that they need to go through, every time someone in your content team is missing their cup of coffee. Repeated price mistakes is a sure and easiest way to lose genuine customers.

Dont surprise your customers with orders they never expected. Lack of information or misleading information (Showing a 16GB pen drive in the image and the title says "8GB pen drive"), about the product would ensure that you never get that precious customer back again.

4. Delivery and Inventory Management

You cannot or must not try to sell something that you do not have. Some popular eCommerce portals simply do not have concept of Inventory Management built in their system. If you believe that you can try to procure your order later or simply refund the money, if you cannot procure later, is another sign that you do not care about your customers. I had this issue recently when I ordered a book, I really wanted in a week's time and only to know 5 days later that the book has been sold out. The website still showed "In Stock". I vowed that I would never buy again with them.

With the concept of "Cash on Delivery" helping the eCommerce boom, providing such an option to your customers without any additional charges, builds up a level of trust and confidence that could help a lot in building a ling term relationship with the customer.

5. Privacy Issues.

If you are a deal regular, How many emails or SMS do you receive every day? Such promotional emails and SMS could be a great way to reach out to customers but if you forget to provide an "Unsubscribe" option, you will surely end up frustrating your customer and de-valuing your brand. Handling customer data better is a pre-requisite for building a brand like Amazon and I hope more players take such issues seriously.

Sending them an email daily that they are lucky winner today to receive an Adidas bag free or sending them enticing mails like Get Rs. 59 petrol for Rs. 5, could earn you brownie points for innovative marketing strategies but will not help you in the long run, when everyone is educated about such gimmicks. Rather one must spend those bucks on providing competitive prices and better service and gaining long term customers would be much easier then.

With Amazon soon entering the Indian shores and Flipkart setting very high standards, it sets up a big challenge for everyone to ensure that they do not continue to remain as "just another player" but sets them apart with high ethical standards, exceptional customer service, high quality and fully functional website and better inventory and shipping management process(es) in place.

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Tag Words: shopping trends, flipkart, desidime, shopping in india, ecommerce

Categories: Shopping

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