Online shopping gains consumer comfort
In 2011, consumers are going to live for new experiences. These new directions could be in how they shop, travel, communicate or conduct transactions. Rachit Vats reprots.business Updated: Feb 20, 2011 21:48 IST
In 2011, consumers are going to live for new experiences. These new directions could be in how they shop, travel, communicate or conduct transactions. In what is already being seen as a trend and called as the second coming of e-commerce, many Indian firms are rushing to set up or rejuvenate their e-stores. Most retailers who already had e-stores, are re-launching them.
While Future Group's Future Bazaar.com was launched in October 2010, other retailers too are looking at re-energising their online ventures. Market sources say that other than retailers, FMCG companies, jewellers, and consumer electronics companies are already looking at setting up e-stores.
What has so far been restricted to online rail, air and movie bookings, is expected to expand in reach and impact now. "With the current e-commerce market estimated at Rs 27,000 crore, retail chains and lifestyle brands are exploring e-commerce to maximise profits and attract more footfalls, both offline and online. There has been a 30% year-on-year growth over the past three years in e-commerce. Brands are extensively chalking their strategic plans to venture in the digital commerce segment," said Jeetendra Joshi, VP - marketing, Reasoning Global eApplications.
In its earlier run, low internet penetration and lack of trust were the core reasons cited for the weak response towards online shopping. Now, with the internet penetration of 7%, which can reach 20% in the next five years, increasing time spent on the internet, adoption of connecting devices (smartphones, tablets), people are more ready to engage in transactions online. With online experiences developing rapidly, a lot of consumers in India have already started shopping online.
"The consumer traffic has jumped and every 'Battle Ground' day we see a further 4-5% rise. On an average, we see at least 50,000 visits per day. The growth is good and we expect Future Bazaar to contribute 10% to overall sales of the Future Group," said Rajiv Prakash, CEO, FutureBazaar.com. While it already retails consumer electronics, FutureBazaar.com plans to add other categories soon. The company claims the deals it offers are cheaper than those offered in the market.
Reliance and Shoppers Stop too have online presence and other retailers are looking at it. "Online retail is a good opportunity. We have not got into it yet but it is an emerging opportunity and we might look into it," said Thomas Varghese, CEO, Aditya Birla Retail.
Sources claim LG Consumer Electronics, which shut its e-commerce venture earlier, is in the process of rejuvenating it. Godrej Group too is looking at setting up an online shopping destination for all is products. FMCG major Dabur India, which also runs its New U retail chain, recently launched a dedicated online shopping portal for its beauty range - Dabur Uveda. D' Damas, Nakshatra Diamonds, Videocon, The Bombay Store, Base Camp Traveler (Victorinox), Neeru's Saris and others recently set up their e-stores.
"The original idea was that online business can be huge internationally, but now we are seeing good domestic traction as well," said Asim Dalal, MD, The Bombay Store.