How to indianize your ecommerce site?

Written by: Madhur

On Jan 12th, 2007

Ecommerce is very important to sustain the growth of Internet. The ecosystem just doesn’t complete without ecommerce. After all that’s where the real money exchange happens between users and businesses. All other revenue models and businesses are just supporting, they cannot stand on their own. For example, there cannot be much expansion in ad revenues, or revenues from affiliates unless customers are ready to buy stuff that businesses are trying to advertise in the first place. We know that it is going to happen. Today or tomorrow, ecommerce will take off. It has happened in travel, it has happened in matrimony, jobs. Online retail is the next important and the biggest sector. There’s already a good number of sites that have decent offerings, but something feels lacking in them. Some of them are better than others in some respects, but none of them seem to be really tailor-made for Indian infrastructure and audience. Here is a list of points that we have come up to make a site better suited for users in the Indian context.

Payment system
People are not used to online payments. Forget online payments, people living outside of metros don’t even do a lot of credit card transactions. Customers need to be educated about this. They need to be given extra assurance that these transactions are safe. They should be given multiple payment options. Credit Card, Cash on Delivery, Cheque, Net Banking are just few of the days. Just today came across these two pieces of news, which talk about how BharatMatrimony (payment at local post office) and Yatra (payment at Web World) are using interesting ways of making payments easy for the users - quite neat.

Customer Service
Customer service is not a concept that a lot of Indian companies are associated with. (Isn’t it ironic that India considering that world’s leading companies have their call centers in India?) In any case, customers need to be assured that they will get top notch service. Phone numbers, live chat are some of the ways. Providing them assurance of smooth returns/exchanges will help quite a bit as well.

Shipping (delivery) assurance
Postal service is not exactly something that people in India count on. Of course most ecommerce companies use private courier companies for delivery, which are much more reliable. This needs to be spelled out explicitly on the site. Users need to be given guarantees about this.

Offline presence
We have written about this in details here. Having offline presence just gives a feeling that its all “real”. This can be a very important psychological factor for many users.

Mobile angle
We have seen a lot of companies using interesting ways to promote their service using mobile as a medium. This needs to be continued. Shipping info, tracking, price alerts, there are so many things that can be done using mobile. One of the biggest things that will help is mobile payments, when that hits the mainstream.

Price break
All things said and done, there is no real compelling reason for people to buy online unless they get a real break in the price. And this should happen. Businesses avoid the cost of building and maintaining physical stores and hiring employees by selling stuff online. At least a part of these savings should be passed on to the customers. And again customers need to be given proofs that they are getting non-trivial savings because they are buying online. Schemes like price matching will also definitely help.

Local language
The largest circulated daily in India is not English. To reach the critical mass, Internet has to go local language in India. Ecommerce sites typically have very little content. Having options to see them in local languages can be a very useful value add.

User interface
Keep it simple. Lot of Internet users are new and will be new in this growth phase. Lot of them would be doing their shopping first time. There is no point having complicated Ajax site or having a site full of flashy ads or million options for customizing what users are buying. Remember that most of Internet users still use dial-up, so the simpler the site, the faster it will be and more reach it will have.

What do you think? Why would you buy online, or why do you NOT buy online today?

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Entry Filed under: ecommerce, online retail, online travel

9 Responses

  1. 1. Abhinav said on January 15th, 2007 at 5:58 am

    This is a real-life, first hand example of customer service.

    I registered on the Seventymm website to get DVDs - I don’t like movies but wife does and 4 a month seems a good enough number. While using the Seventymm site to make a payment for my registration, the browser hung after I had entered my credit card details, et al.

    For a while, I didn’t know what to do. After 15 mins or so, I killed the browser application. I went back to Seventymm website to see if the payment had indeed been made. The site said “no”.

    I decided to wait for my statement - which was due to come out in a day or so. Due to personal and professional reasons, I was away and the statement went unchecked for more than a month. The statement confirmed that the payment had been made.

    I called up Seventymm. They asked the date on which I make the payment and my account number (with Seventymm). I told them. They say they will get back. Seventymm apparently uses an ICICI gateway - they said they need to check with that which was not possible at the moment due to heavy traffic. They didn’t. I call them again after a week. Someone else answered - asked for the same details and said that they will get back. They didn’t.

    I have called Seventymm 4 times - each time, a different person has answered the call. Each time, nothing has happened.

    I am currently gathering details from my Citibank account about the details to file a case in the consumer court against Seventymm for repayment of my money. I don’t want their shitty service anymore. I want a full repayment of the amount I paid for registration.

    Given that these guys have already Indianized their websites - “by providing shitty customer service” - I don’t see what they can do to Indianize more. I don’t care anymore as to which big name VC invests in these shitty websites - I aint going to sign up and pay money till I know someone on their staff personally.

    That, in my view, is true Indianization that these guys have already achieved.

  2. 2. vivek garg said on January 15th, 2007 at 7:12 pm

    wow .. i did not expect this from a company that has netflix advisory board and sequoia funding. But you are right, Abhinav. This goes on to prove how much work these companies need to put in to their customer service. I hope Seventymm is listening to this kind of feedback.

    I have had similar experience with Sprint in USA. But phone companies everywhere have a reputation.

    Are other users facing similar trouble ?

  3. 3. Madhur said on January 15th, 2007 at 7:48 pm

    Absolutely. This is the kind of customer service (or lack thereof) thats so commonplace in Indian companies. Same story for me trying to sign up for Airtel Call Home service. Tried multiple times, registration failed. Called customer service 5 time, with no luck, eventually gave up.

    If this continues, its hard to imagine how far these companies can go.

  4. 4. Chandra said on January 16th, 2007 at 4:03 pm

    Local language and User interface will play major role in Indian ecommerce market. For users it doesn’t matter whether you use AJAX or any latest technology for your site, what they need is a reliable, pleasant and easy to use service.
    I hope some day we will all see ordering vegetables online and getting them delivered to our doorsteps. I guess it is not so far….
    I feel mobile(SMS) payments would be more reliable and secure. I predict mobile payments will eventually replace credit card swiping and online payments.
    Abhinav, I feel you had a bitter experience and would never use that site again. Unless the online ecommerce sites improve their customer service its very difficult for them to survive in this space.
    Personally I feel almost 70% of the online ecommerce sites need to consider redesiging. None of them follow web standards, they are less accessible and load times are very high. Its very difficult or almost impossible for older people to use these sites as they can’t increase the font sizes. Following accessibility guidelines would defenitely make these sites accessible to more people.

  5. 5. Vivek Garg said on January 16th, 2007 at 5:25 pm

    Chandra, can you give us examples of the sites that are following good design prinicples in indian ecommerce space ?

  6. 6. Chandra said on January 16th, 2007 at 6:08 pm

    Vivek, I don’t have any examples of good sites. I rarely buy anything online except books from amazon. But I do visit Indian ecommerce sites when they are mentioned in blogs like ContentSutra, iLeher or any other sites. I usually visit these sites to check the design, accessibility and whether the site follows web standards or not. The figure 70%, which I mentioned was not an exact figure but, most of the websites need a redesign if they need to be accessed by all people. For example increase the font size by one time for http://www.futurebazaar.com/ in firefox, you can notice some of the menus getting hidden. You can’t even resize the text in IE 6 or earlier. Re-sizable text is the primary requirement if you don’t want to miss out those older people who want to buy something on your site.

  7. 7. Sanjay Mehta said on January 28th, 2007 at 8:16 am

    Some additional thoughts on this subject are:
    1. Beyond everything else, the most important factor that needs to be figured out, is the value proposition of the e-commerce offering, for the Indian consumer. Indians have not been catalog shoppers, historically, and hence, purchasing a product from a picture is still alien to us. Indians have not got bored or frustrated with offline organised retail yet - far from it. Most daily requirements are easily found in near proximity for most people (at least most of those who are online, and would be considered the target market). There is not a huge markup from manufacturing to retail in India, as is in the US, for example. The intermediate cost structures not being as high as they are in the US, the markups are lesser. Hence, the elimination of the intermediary channels (and not all can be eliminated still) give small saving, not huge ones. So making price a factor is not that easy. In fact, there are other challenges to the cost quagmire, for e-retail. Like cost of retail orders shipping, not having the buying power of large scale organised retail and hence not getting as good a price from manufacturers, distributing from a central warehouse with accompanying cost burdens of octroi, VAT, etc.
    So price cannot become a differentiator!

    So the start of the e-retail proposition has to begin with figuring out, the fundamental value proposition to the customer.

    And while it may not come naturally or obviously, I am sure that models will emerge and which would have identified such specific value propositions.

    2. As regards payment, paying via post office or bank drafts etc, while being interesting options, do not make for large scale e-retail adoption. It may be worth doing this, to make a one time registration payment for Bharat Matrimony, as you will derive value for a while, after that one payment, but for purchasing products online, it has to be a mode that happens ‘there and then’. Barring specific larger value transactions like white goods for example, a lot of e-retail may be for smaller ticket orders, and the whole effort of going some place, specially for making payments, would do away with the whole convenience factor of e-retail.
    With alternatives like cash cards, there is hope on this front. Moreover if travel purchases have been happening so significantly, including from tier II towns, the payment challenge may not be as huge as its made out to be. If the customer is given a convincing reason to buy, he will find his way to make the payment, I suspect. There is also direct debit options from banks. Mobile payments will also start getting more common, and hence there are enough interesting solutions on offer.

    3. Customer service is more than giving customer assurance. Its a culture that needs to be built inside a company. To share our experience at Homeindia.com (we have been in e-retail for last 7 years, although SO FAR focussed exclusively on the market OUTSIDE India), from early days, we did not pretend to be the biggest or the cheapest online store. Rather, we focussed on being the most ‘reliable’! What customers have been looking for is credibility. Will they get the product that they see on the screen? Will it reach them on time? Will there be a human being to respond to their questions on phone or on email (as against some automated responses)? What if there are some hidden costs? etc. etc.
    All of these were addressed by building a company culture and processes within the organisation, that supported the reliability factor for the customers. And all that, I doubt, happens by simply putting assurances or having a good CRM team. It happens by building an organisation with customer service at its core.

    4. Its interesting that you mention shipping. Let me share the realities that many readers here may not be aware of. The best of branded private courier services in India, do not cover more than 30% of India’s pin codes, for delivery. This is against a UPS or a USPS which cover 100% of the US destinations.There are product restrictions that some of them have. There are paperwork requirements to send products to certain parts of the country. In short, logistics is a huge challenge and shipping packages across the country is easier said than done. Moreover, there are additional cost factors depending on destinations, like octroi, entry tax, VAT, etc. A brand focussing on doing e-retail in India, has all these challenges to grapple with.

    5. Offline presence: while that makes for an interesting option to show that you are ‘real’, it certainly puts more pressure on the cost proposition. Online retail, as against providing matrimonial or recruitment services, has to play within the gross margins of the product sales, for all its revenues. In that difference between the selling price of the product to the customer, and its direct costs, the company has to make a viable business. Offline presence, unless figured out in some intelligent and smart manner, can put a huge burden to this viability option. Moreoever it obviously makes the growth a little sluggish as you cannot ramp up offline presence that fast.

    6. About prices: have mentioned enough already. Again not the easiest task to offer good price breaks, as elaborated above.

    Then there are some more issues to consider. The supply chain in India is very challenging, to say the least. Unlike the US market which has a mature supply chain, working with manufacturers and expecting them to have products available when orders are to be executed, or get the size / colour / style right, etc. cannot be taken for granted. Certainly, as the manufacturers start working with organised retail, their own systems are improving, and there is hope for the future. But at this time, to generate a good reliable business, there could be a need to do some inhouse inventory holding, which of course, puts a different spin, on the business model.

    One who gets this all in place, can of course, succeed.

    We have also chosen to focus inwards into the Indian market, and have a strategy in place, to address the challenges. Of course, I cannot discuss the details here :-)

    - Sanjay

  8. 8. Madhur said on January 29th, 2007 at 5:13 am

    Thanks for sharing your insights Sanjay. How has your strategy (targeting the NRI audience) worked for you so far? Is this customer base large enough to support the number of players (50+ ?) addressing the space?

    I personally think that people will start realizing the value add of online shopping (comfort, variety, research tools, etc.), but like you said it will be interesting to see who gets the things in place within the constraints of working in the Indian market.

  9. 9. Sanjay Mehta said on January 29th, 2007 at 8:22 am

    Madhur,
    When we started in 1999, there was no market worth talking about within India, and we were left with little choice, but to address the NRI market. Yes, there were many players then, several of them wound up shop, few new ones came in.
    For us, it was the market we were addressing and we stayed course. Its been a fantastic experience, going from small value gift transactions to offering products delivered to the NRIs, to going up the value chain, getting into custom-fit high-end wedding wear, getting into the non-Indian (as in ‘foreigner’) market etc. etc. A phenomenal learning experience that no theory could ever match. Continuous morphing of the business, even as we worked with limited resources (no one was funding dot coms from 2001 till almost 2006!). To survive, to break even and make a little money, to differentiate with the 50 others as you mention.. all those were the challenges that we overcame to a fair extent.
    The way I describe what we have been doing (and our raison d’etre in a way) is that ‘we are the bridge that connects an inefficient supply chain with a demanding customer’, while we have been catering to the global markets.
    Having done that well, and succeeded, I am sure we are only better off, as we approach the Indian market now - both factors are changing. The supply chain inefficiency is reducing to an extent. And as we cater to the Indian customer, hopefully, we will cater to a slightly less demanding customer
    ;-)

    - Sanjay

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