The eCommerce sector has seen unprecedented growth in 2014. The growth was driven by rapid technology adoption led by the increasing use of devices such as smartphones and tablets, and access to the internet through broadband, 3G, etc., which led to an increased online consumer base.
In 2015, eCommerce players see mobile commerce as the most preferred route with mobile wallet as the preferred way of payment. With 4G services expected to be launched in 2015, internet penetration is likely to take a significant leap, which is likely to give another boost to mobile commerce. Changes in lifestyle and shopping choices will see buyers preferring online and mobile channel over physical channel to save time and seek wider range and possibly comparative pricing. For mobile wallets, improvements on the payments front with multiple payment instruments and increase in payment gateways aided by enhanced security with multiple authentication layers will help the consumers with a seamless mobile experience .
According to Forrester Research, by 2020, eTail in India is expected to account for 3% of total retail. Further, orders per million are expected to more than double from five million in 2013 to 12 million by 2016, which will mean more opportunities for both consumers and eTail companies.
Continuing with the research facts, I would also like to share one of my experiences with working on a key engagement for a leading art marketplace client. Their objective was to create marketplace for potential buyers and sellers around the world. We enabled an e-commerce platform that provides the opportunity to buyers and sellers to showcase artwork and perform transactions. This platform builds trust with the art community through transparency and complete accessibility. The platform is automated, self-standing, robust and scalable. With our solution, this company removed traditional bottlenecks in the art marketplace, bringing global artists and potential buyers closer than ever before. PwC’s research suggests some of the efforts which will help eCommerce companies accelerate and sustain growth .
Things the eCommerce companies need to do to accelerate growth
- Customer experience: As the customers progress from research to purchase to fulfillment stages, their expectations change fast. eCommerce companies need to understand these change drivers and adapt their proposition accordingly.
- Technological advancements: eCommerce companies constantly have to upgrade their offerings with changing technology. For instance, shopping through mobiles have truly arrived, they need to devise easy to use mobile apps for their websites. They need to ensure that their websites have the required speed to do fast business, especially during sale, deals and discounts.
- Convergence of online and off line channels: As the customers progress from research to purchase to fulfilment stages, their expectations change fast. eCommerce companies need to understand these change drivers and adapt their proposition accordingly.
- Delivery experience: With lack of integrated end to end logistics platform, the eCommerce industry is facing issues related to procurement operations and transportation. Online purchases from Tier-2 and Tier-3 cities are expected to significantly increase, thanks to the emergence of low cost smartphones, however, poor last mile connectivity could act as a deterrent.
- Payments and transactions: India continues to be a cash-based society due to limited banking and credit card penetration. This, combined with a lack of consumer trust in online merchants, has forced companies to offer CoD services, which imposes significant financial cost for firms in the form of labour, cash handling and higher returns of purchased items.
- Tax and regulatory environment: Laws regulating eCommerce in India are still evolving and lack clarity. Favorable regulatory environment would be key towards unleashing the potential of eCommerce and help in efficiency in operations, creation of jobs, growth of the industry, and investments in back-end infrastructure.
There is humongous potential for eCommerce companies owing to the growing internet user base and advancements in technology. However, this will not be without its share of challenges, be it operational, regulatory, or digital. How a company prepares itself to meet these challenges will decide whether or not it succeeds.