Thursday, August 11, 2011

Back with a Bang... Or Is it???

Ok! So whats back? & with a Bang?

Me for One..... am back to blogging.... &
eCommerce in India.....

Me?? Well who cares if am back. More importantly what seems to be really back with a bang is eCommerce in India or so the media will have you believe. Open any newspaper or magazine or article on the web and every other day you will read an article or news of a new eCommerce website being launched or a story on eCommerce in India and how its the rage nowadays and how VC's are pouring money into Indian eCommerce start ups.

Whats interesting is how almost every article mentions an example of a small town girl or guy who has bought something from the Internet and is gushing about it. Well is that really whats happening out there? Have Indians all of a sudden found this sudden urge to shop online and people from non metro towns and cities started using credit cards online??? I really don't know how much of what is being said or written is true as real figures on purchases and company top lines and bottom line etc are still not available.

What I DO know is this:
1) India's Internet usage is increasing which is great. Though still not as fast as it should be. Claims of a 100 million users is not really accurate unless one agrees with the logic that someone who logs in at least once every month is an Internet user.
2) Number of sites and hence content and services on the Internet from India is increasing... at a real fast pace which is good.
3) We still have infrastructure issues such as non availability of 24 hrs continuous electricity in many a towns and cities across the country which means less time to be able to connect to the internet to do anything meaningful, low broadband penetration, etc etc...
4) Credit card penetration that is dropping each year for the past 3 years from its already low figures instead of picking up. Debit cards far out number credit cards in the country but usage ratio of Credit cards to Debit cards is 11:1 as debit cards are mostly used as ATM cards only.
5) Absence of a robust supply chain, and offline payment collection mechanism / service means those setting up sites for  e commerce have to set up on their own systems (increase in costs) or depend on existing unreliable services (loss of customer due to bad service).
6) No clear returns systems or policy even in offline stores which is even more important from the  eCommerce perspective.

So Yes! eCommerce is back. Is it here to stay? I definitely think so.

However they may not see break even or profits for some years to come as India has a lot of infrastructure, policy and also regulations issues to resolve and these are not going to happen very soon. Also let's not forget that we are a touch and feel kinda people whose idea of an entertaining evening out  mostly means going for a movie or dinner or going shopping with family / friends, in that order in most cities in the country. We get most of what we want in the mom and pop store next door and the rest in our so called entertaining evening or weekend shopping trips to the mall. So for what are we going to shop online??? Books? Yes ... but how many people buy an read books nowadays. Tickets? Most definitely as no one likes to stand in line. Electronics? Yes some of it. Ditto for the rest of the items yes for some, Maybe for the others.

Also I believe whats important for eCommerce to take off... really Take off... is for the Internet users in this country to first start using the Internet for all other regular activity such as Banking, Paying bills etc etc. The truth still is that if you ask 5 people in your close circle weather they have ever used their credit / debit cards online (assuming they have credit / debit cards) chances are 3 out of 5 will say No. If you ask these people if they have used Internet banking to receive or make a payment (not check balances) again 3 out of 5 will say No. Ask them if they use the Internet to pay their utility bills and again chances are 4 out of 5 will say No. Ask them what they use the internet for and all will say eMail and some will say for information. That's It.

Anybody who has or is using these services will also tell you that while they are happy to be able to do this their experience has not been really good. Not all Bank websites function well or are user friendly, Telephone and electricity websites are slow and tend not to work just on the day you decide to use these to make payments etc etc....

On the MSEDC website if you are trying to make the payment a day after the due date they do not allow it and ask you to go to their center to pay. That even when they tell you how much is the penalty for late payment, but for making the payment you have to go offline if you are even a day late.

A Nationalized bank asks you to go to your Branch and submit a letter if you have forgotten your password and made a wrong attempt x times. Then the letter will be forwarded by the branch to HO and then HO will send the new password back to branch and then you have to again visit the bank branch to collect it. That's Internet Banking for this Bank.

Its the issues like those mentioned above that hinder the growth of the Internet and  Internet based services in this country. As businesses and services we have to realize that this medium can help us offer a better service to our customer and give it its due attention. That is when people will start using the medium and that is when eCommerce will really take off.

Till then - Well it is great to read articles highlighting the new coming of the eCommerce age. At least now media is writing about advantages of the Internet and Internet businesses instead of the negative stories on credit card fraud, and other frauds that they are so used to writing about. Its time they told you how actually more fraud happens offline than online and how online is actually more secure and convenient. It's time they spoke of how the medium is helping business find more clients or people finding long lost friends. It's time they spoke about how a girl from Assam found a job in Pune or how a Guy from Punjab found a soul mate from Goa. Its time they talked about Internet business success and how it has benefited people in general and business too.

So Yes eCommerce is Back and yes this time it will be for good......  hopefully :-)