E-commerce in India: Inspiring Infographic

How big is the current Ecommerce Industry in India? What s the potential for growth? What are the main challenges ahead??

Find these answers and more in the simple Infographic below

Key points that catch my attention are:

* Current Growth Rate = 47% CAGR (Compound Annual Growth Rate)
* Payment model Innovation – Pre paid card, Mobile Banking, Swipe on Delivery, Cash on Delivery (pretty obvious)
* +84% increase in Mobile Internet users next year
* +98% increase in Rural Internet users next year
* Global players (Amazon) entering India (after a looong wait)

Have a look at this detailed Infographic –

India E-commerce Overview - Infographic

Courtesy: Referral Candy

Related Blog Post:
Key Commercial Considerations for Ecommerce Growth in India

Ecommerce in India – Key commercial considerations for Growth

Ecommerce has been one of the most challenging and thought provoking modules in my Masters Degree. Inspired by cutting edge practices from multichannel and pure-play internet retailers in the US and the UK, I was curious to explore how this fits into the Indian market scenario.

Ecommerce landscape in India –

According to a report by Internet and Mobile Association of India (IAMAI), even though India’s estimated 100 million Internet users comprise the third largest online population; the total Indian e-commerce market is just 3% of the U.S. market at the end of 2010. This implies that Ecommerce is still at a nascent stage in India, when compared to the other established markets.

Considering the fact that Indian ecommerce is at a nascent stage, is setting up full-fledged Ecommerce operations viable for retailers in India?

Based on IAMAI research, e-commerce in India is expected to grow by 47% to over 46,000 crore INR by the end of 2011. It is interesting to note that Indian Venture Capitalists have already invested over $50 million in seven e-commerce companies in 2011, reporting a 400% increase in funding over the same period last year. Based on these considerations, the future for Ecommerce in India looks quite promising. This growth is primarily driven by the online travel industry, which contributes 76% to the total net commerce industry in India today.

Key commercial considerations for Ecommerce in India

Rural adoption – Presently, the Tier I and Tier II cities contribute a major chunk of revenue to the Ecommerce industry. Considering the fact that more than 50% of India’s population is in rural areas, rural adoption for embracing Ecommerce is a potential area where retailers should seriously consider.

According to research reports, rural India is expected to be a significant contribution source of ecommerce revenue. From a commercial perspective, one of the key areas lies in overcoming rural infrastructure challenges.

Group buying – Based on the consideration that majority of India’s middle class is price sensitive and look for discount purchases, group buying options offered by internet retailers seems to be a lucrative option. Earlier this year, international major Groupon entered the Indian market by acquiring the Indian firm SoSasta.

The rise in group buying has been propelled by the growth of e-commerce and the increased spending power of India’s middle classes. The commercial perspective for retailers lies in leveraging promotions / group offerings which have a strong connect with the average Indian consumer psyche.

Alternate payment gateways – It has been found that Indians are not at ease with credit card usage – only an estimated 2% of the nation has a credit card in the first place.

According to an article by ‘Business Insider’ magazine, alternate payment methods such as cash on delivery and net-banking are alternatives for leading e-commerce platforms and have the potential to drive nearly 75% of all online transactions in India. However, alternate payment gateways in India generally charge a high service fee on online retail transactions. The commercial implication is that retailers need to evaluate service costs vs increased revenue potential for setting up alternate payment gateways.

Mobile growth – It is estimated that by 2020, nearly half of India’s population will use handheld devices for online transactions. These projections highlight the potential of mobile facilitating internet commerce.

According to John Donahoe, eBay’s President and CEO ‘E-commerce is taking off slowly here but I think the Indian market can experience significant growth over the next few years as 3G services are launched and mobile broadband gets more ubiquitous’. It is interesting to note that the emergence of mobile internet would mean a fundamental shift in consumer attitudes in terms of willingness and the ability to buy online.

Integration of ‘online’ channelHow do users in India use the online channel for purchase decisions? According to a research report, ‘large numbers of Indian surfers use the Internet to look for information about the product or service they want to buy followed by a physical visit to a shop for purchase. The commercial benefit to the retailer lies in further integration of ‘online’ with multichannel proposition.

Have more points to add on? Would love to hear your thoughts…

Marketing in the Digital Age: Principles of Permission Marketing

With the advent of media channels and the web, businesses cannot rely only on traditional interruption based advertisements. It has been found that mass advertising is often ignored by large sections of the audience, and increased expenditure on media spends are showing decreasing results on ROI.

Marketing in the Digital age looks at this contradiction from a new paradigm. For a better understanding of this paradigm, I would like to highlight key principles of ‘Permission Marketing’ as popularized by Seth Godin.

Value of Permission marketing – Seth Godin says that permission marketing offers to convert strangers to friends, and friends to lifetime customers. The principle works on identifying potential customers, offering a tangible value exchange, getting their opt in, building long lasting relationship with them over time, and leveraging on this relationship to increase sales from each customer.

Permission is an Investment – It is important to realize that seeking permission is really an investment, as each potential customer is worth a lot more when data is harnessed across the customer lifecycle. Also, building deep relationships fosters word of mouth marketing, and reduces cost per acquisition in attracting new customers. It seeks to increase share of customer, rather than just share of market.

Frequency builds trust – Sending communications of high relevance and frequency fosters trust and has an indirect benefit on brand building as well. Messages should be anticipated, personal and relevant to each user.

Permission levels – It is interesting to note that permission being granted by customers could be on various levels, such as intravenous, points based, personal, brand trust and situational. The marketer should know which permission level to access depending on the customer value and lifecycle model.

Permission marketing on the web – According to Godin, the Internet is the greatest direct marketing medium ever invented. Most importantly, the web has made the ‘intelligent use of data’ at the cornerstone of all marketing activities.

With the rise of the web and reduced costs of operations, direct marketing and CRM has become extremely important in today’s age.

MSc Digital Marketing class on the BBC

I was certainly not expecting this…
This was shot during our MSc Digital Marketing class by the BBC Newsnight team.

Featured above are Prof Andrew Seel (social media strategy consultant), Martha Tolosa, Ivannia Figueroa Sosa, Erika Hernandez, Adriana Mancilla, and you guessed it right… that’s me on the extreme right:)

The BBC were filming this as part of their piece on foreign students and immigration in the UK.

7 key elements of a cohesive Content Strategy

Whatever channels you may choose (be it search, email, social, mobile), ultimately what users read and interact with is ‘quality content’. Think about this –

At the heart of a good Digital Marketing Strategy lies a cohesive Content Strategy.

Yes, the old adage  ‘Content is King’ is perhaps even more important in the Digital age.

How do we go about ensuring the right Content Strategy? Here are 7 key elements to consider –

Engagement objectives – What are your specific objectives to be achieved? These could be brand awareness, lead generation, on site conversions, post purchase loyalty or a combination of the above.

It would be a good practice to consider content creation for each stage of the Customer Decision Journey. Here is an interesting framework developed by BrainRider Marketing group, have a look –

Editorial Strategy – This contains the overall guidelines which defines digital content creation.

It is important to plan for content creation through an editorial calendar, for example having a high level plan on the type of content and the person accountable for this on a weekly basis.

User Generated Content – With the rise of the social web, user generated content, ratings and recommendations play a crucial role to influence prospective customers.

As marketing folks, how can we influence people to share positive reviews and brand mentions about our organisations? This can be done through multiple ways, some of which include setting up polls, asking for user inputs, seeking recommendations for product improvement and running competitions.

Search engine optimization requirements – It is crucial to integrate search marketing principles into content creation. Researching on key topics being discussed on the social web helps provide ideas for content creation.

Consider creating content around ‘long tail’ keywords which are specific to the user buying stage.

For example, if the long tail keywords searched for by prospective customers is ‘buy iphone central london’, then plan for content creation about related topics on this specific long tail keyword. This would ensure higher qualified traffic (users who are considering product purchase) from search engines.

Social sharing – Consider facilitating content creation which users would like to share with friends and peers on the social web. This involves understanding psychology of customers, and the key drivers / motivators as individuals.

It is also important to ensure that social sharing integration is implemented correctly, which further encourages users to share content. Do ensure optimization of various social media platforms as well.

Channel distribution – How do we go about distributing content online?

Set a plan for content distribution which includes identifying the right platforms for different types of content, and establishing a methodology to reach out to key influencers in your audience communities.

Tracking engagement with analytics – Tracking content engagement with web analytics is extremely important. Independent research studies suggests that majority of companies do not check analytics / check and measure the wrong metrics, and hence are not able to take actionable insights.

Keeping track of the right metrics and KPIs would enable incorporating changes to content being developed, to obtain higher efficiency and readership. For example, Econsultancy keeps an active track of user engagement with different blog posts, which in turn helps decide on subsequent blog posts to be produced.

Have any more points to add on? Would love to hear your thoughts.

Creative Advertising Concept for H&M

I recently participated in the Future Lions Advertising Contest with my friend Tarek Reda.

The Brief: Advertise a product from a global brand in a way that couldn’t have been done five years ago, to an audience of your choosing.

We went through a lot of brainstorming, it was quite challenging to come out with a really cutting edge solution.

After 3 full days of rigorous brainstorming, voila…. we came out with our big IDEA – an innovative, cutting edge solution for H&M to enhance their customer shopping experience.

Have a look at the video…


What do you think of this idea? Would love to hear your thoughts.

Pricing Models in Digital Publishing

Digital publishing has been challenging for legacy publishing houses in more ways than one.

For example, how do you approach pricing models for content? There is a widespread notion amongst people that content online is free, and should not be charged for from subscribers.

Research shows that people are willing to pay $2.00 for a coffee at Starbucks, but hesitant to do so for the online version of the New York Times or the Wall Street Journal.

How do you approach pricing in Digital publishing?? 

Here are potential revenue streams for Digital Publishers –

Free Content / Ad Funded – Publishers keep content free of charge to readers and monetize advertisements displayed. This may not be a sustainable model to focus entirely on ads for bringing in revenue.

Content Funded – A variation of the Ad Funded model, here advertisers/organizations get to sponsor content sections, and users are able to access free of cost. Let me explain how this works. Here, the advertiser / brand chooses to sponsor a section of quality content relevant to its brand proposition and audience segment.

Freemium ModelThis is a model well suited for the digital age. The freemium model is quite different in that it allows visitors to see all content; however, once they reach a certain consumption threshold, they are required to pay a fee to continue to consume the product.

The Financial Times, Econsultancy, Spotify are a few businesses utilizing the Freemium Model.  However, I believe for this to be really successful, the publication requires highly differentiated content and provides a unique value exchange for readers.

Subscription Model – Here readers get to subscribe based to content based on their preferences. Rather than pay a flat rate for content, they get to choose their preferred content sections and length of subscription. This makes it more personalized to a specific user needs.

To quote Rob Grimshaw, managing director of FT.com “The internet is a personal environment and pricing needs to cover the broad spectrum of needs. Some are more than happy to pay an annual subscription, others just want access to a couple of articles, this has to be accommodated for in the pricing.”

Software Model – What does the software business model have to do with publishing? Here’s the connection.

The software model is based on pricing by spreading the costs of a product across its anticipated customer base for a particular release and support timeframe. To quote Kent Anderson “If we begin to think of content as software — issues as releases, support as provision and maintenance — and have a relatively stable customer base, we can begin pricing online properly. We just need to allocate the costs properly”

This means that content production requires a new perspective altogether, to allow subscribers to pay for new content releases as upgrades.

Pay as You Want Model – This model allow users to pay as they deem suitable for content.

For example, Radiohead allowed buyers to choose the payment amount for their 
“In Rainbows”  album. However, for this to work the audience should still be willing to pay and believe in a community cause for the greater good.
As a parallel, Wikipedia allows users to contribute by donating any amount of their choice.

What s the best solution to Digital Publishers?

I would say there are no silver bullets. I agree with Vivian Schiller (former general manager of nytimes.com) that the answer is not in one model, but a diversified revenue approach.

I particularly think that Community and Social would have a big influence in sustaining Digital Publishing Business models. It would be interesting to see the balance between high quality content and innovative revenue streams.

What are your thoughts? Let me know.

At Social CRM London

Social CRM… wondering what this is? Read on…
I had been to the Social CRM Conference in London recently as an Event Volunteer.

First things first, what is Social CRM? Have a look at the representation below –

Social CRM is the next step to traditional CRM (Customer Relationship Management) framework in organizations.
In a nutshell, Social CRM is about harnessing data and insights from Social channels and incorporating with existing CRM systems to obtain a holistic view of the customer.

Some pointers on what the conference covered include framing Social CRM Strategy for organizations, the process of mapping CRM system to the Customer journey, how to pick the tools that matter, challenges of implementing social CRM, case studies and best practice.

Particular focus was given to Social data analytics and the challenges organizations are facing today in incorporating social media data into their existing customer databases.

My personal take – sounds exciting… but in practice, still a long way to go before this becomes mainstream!!

Special mention to Luke Jones and Our Social Times for organizing this pioneering conference.
Your thoughts on Social CRM? Join the discussion…