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Will Ecommerce Tick In India

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DQI Bureau
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Will Ecommerce Tick In India

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The onus on Indian marketers to go online raises questions about the process, patterns and customer psyche involved in shopping, online or otherwise. 

ecommerce, online shopping

Gaurav

Chadha 
  mailto:Gauravc@niit.com



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Jeff

Bezos of amazon.com dreams of selling everything through the internet. And so do

many Indian marketers willing to add the dotcom dimension to their businesses.

The question, however, is whether Indian consumers would like to buy everything

off the net. Before putting their businesses online, marketers should ask a

couple of obvious questions about the psyche governing the buying behavior of

Indian consumers. How many times do people take a prescription via wire even

from family doctors, or how many times do customers decide to buy a

plastic-wrapped item without touching, feeling and experiencing it. Sure, people

like me are not prone to the see-it-buy-it syndrome any more, but when it comes

to buying flowers for my sweetheart or ordering medicine for my ailing family,

perhaps I am a bit too old-fashioned. So, is ecommerce not going to take off in

India? Will consumers stay away from buying online?

Buying

Buying is a

decision-making process that tries to satiate consumer needs at various levels

and the factors that govern it primarily are:

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  • Product needs

  • Information

    assimilation needs

  • Experiential

    needs

  • What-I-see-is-what-I-get

Consumers first experience a need

that drives their demand for the product or the service. In case of repeat

purchases, the consumer would know what to buy and decision making is relatively

simple and straightforward. However, in case of a first time purchase customers

must go through a series of informative cycles based on the importance and

urgency of the product. Information may be acquired from collaterals,

experiences of other users or customers, or advertisements. Just as lot of data

in analysis adds weight to findings, consumers tend to assimilate information to

feel confident and post their decisions. After acquiring information and short

listing couple of products, customers hop around number of establishments before

they finally shop.

In the hopping process, the

customer experiences the ‘moment of truth,’ wherein, either the customer

experiences the service–like the eye check-up at the surgeon’s clinic before

ordering for spectacles–or notionally experiences the product by touching or

feeling it. What follows is an evaluation of offerings that were short-listed

initially and some spur-of-the-moment selections too. Finally, the customer

decides to purchase or not purchase the offering based on the assessments after

notionally experiencing the offers. Back home with the product, customers try to

analyze if they got what they saw or experienced during interaction with the

merchant.

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As is quite evident, the process

of buying is pretty complex, replete with instances in which the customer

experiences the product before deciding. Now, try doing this on the internet and

there are already people saying, "Well, this could be done partially."

So let us take a look at what can be done on the internet and where it falls

short.

Selling

No doubt

that the internet is a virtual datamine as far as information is concerned. So,

as regards information assimilation needs of the consumer, marketers expect the

internet to do a good job of providing information to consumers. However, with

information littered all over this mine called the web, it is extremely

difficult to excavate the information without spending some time on the net.

Search engines, both generic and site-specific are the ultimate information

finders that act as the stores’ frontline staff providing information to

consumers. Artificial intelligence notwithstanding, search engines do fail to

fill the information needs of the online buyer. This is equivalent to

incompetent sales persons sitting on the front desk of a store trying to

configure solutions for the buyer. Usually, serious surfers who know their

business and want to quickly achieve results use search engines. An ineffective

search engine interacting with a serious surfer is a case of bad responsiveness

of the staff and results in the customer leaving the store undecided.

With too many such instances the consumer’s patience wears down even before

the information needs are satiated.

Some may argue that this happens

in real life too when the customer finally decides to stop hopping, and go for a

purchase. But relatively speaking, while shopping offline, customers decide to

buy the product or service as per their will. On the other hand, online

customers are forced to decide due to either too much data or the lack of it, or

perhaps due to poor response time from the website. Apart from this forced

decision-making that leaves them dissatisfied, customers are also expected to

make lot of assumptions about the product. For instance, while shopping online

for a t-shirt for myself, I was given three size options by the web store–small,

medium and large, leaving it to my intelligence to decide which size would fit

me. Of course, after applying my tired-from-surfing-brain, I conveniently

decided to close the web browser before heading to a nearby apparel store where

I chose the best fit t-shirt after a couple of trials.

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Ecommerce

But, with

ecommerce doing well the world-over, as is the popular notion, why this

bickering? First, ecommerce is just the means to an end rather than the end in

itself. It may be one of the strategies a company follows and not the only

strategy. Returning to ecommerce doing well, marketers willing to add ‘e’ to

their businesses must remind themselves that the world’s biggest online

retailer, amazon.com just posted a loss of $720 million. More recently, one of

Hong Kong’s biggest retailer is reported to have snapped the wires on its

ecommerce venture indicating that online selling did not fit its strategy.

Instead of losing heart from these reports, Indian marketers should look at the

reasons for the e-business failing in some cases and doing well

elsewhere.

Losses to amazon.com

notwithstanding, ecommerce has progressed well in the Americas on two counts–faith

in technology and the brands. Faith in technology manifests from willingness of

the masses to use new technology as against traditional equipment. Just five

years back, purchasing a fully automatic audio system with a remote was

considered a bad investment. The logic being that automatic and miniaturized

systems such as those from Sony and Panasonic are very sensitive and would not

adjust to dusty Indian conditions. Also, automatic systems were considered too

complex to be handled by the local service shops if anything went wrong. Things,

however, have changed today, with consumer electronic majors pulling out all the

stops with VCD players, Digital TV with HDTV, and consumers replacing old age

TVs with the latest technology marvels. On the other hand, in contemporary

times, Indian customers are debating the pros and cons of the MPFi technology in

new cars. Not to say that Indians are in any way a technology-averse community,

but it does take time to gain faith in new technology.

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Agreed that the internet was

never marketed commercially, but even the Americas have seen the internet for

ages before deciding to shop through it. With the internet mania raging like a

wild fire, it will require some pro-active steps from marketers before India

shops through the wire. This becomes even more debatable considering the fact

that TV shopping, which has been on for more than four years now, has never

really taken off in India. The reason for this slow take-off, as one consumer

quipped is, "In India what you see is not what you get, and hence I need to

touch it, feel it and experience it before I buy it." This fear psychosis

of a typical Indian consumer is further illustrated by the branding aspect.

Brand

To a customer,

brand is a name that guarantees ‘something.’ Something here could equal

quality, value or any other perception factor that translates into customer

satisfaction. Buying branded apparel from Park Avenue, for instance, assures the

customer of quality fabric. However, brands such as Park Avenue, Raymonds and

Tata are not just built overnight. A symbol or a trade name becomes a brand

after customers experience the quality of the product or a service repeatedly.

One of the basic fundamentals as

far as brand building is concerned is consistency. Consumers feel easy and

relaxed while purchasing brands since they feel confident about the product due

to its consistent attribute as compared to a non-branded product. This adds to

the fact that just like a typical market scenario, convincing a consumer to

purchase a brand is easier when selling a product via the net. Marketers, thus,

need to ensure that their brands are in sync with the minds of consumers before

they are online. This takes care of two issues of consumer behavior during

online shopping–’Am I getting value for money’ and ‘Do I finally get

what I see.’ While buying brands, online or otherwise, consumers feel

confident about their buying decision and seldom show post-purchase dissonance

typically related to price-performance or value-for-money judgment–the same

lady who haggles at Janpath would never be seen haggling at a Levis store!

However, the most important contribution of branding is by way of assuring

customers that what-they-see-is-what-they-get.

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Brand image

Coupled with

faith in technology, brand is perhaps the biggest force behind online buying and

selling in the US. Marketers in the US such as amazon.com can think of selling

everything from cars, bicycles, crockery items to grains and pulses via the

internet as almost everything has been branded. However, looking at the Indian

scenario would tell Jeff Bezos that it is a different kettle of fish where

Indian markets and consumers are concerned. Branding in India is largely

restricted to either high-touch goods like apparels or FMCG, or high-tech

products such as automobiles. With organizational focus on quality being far

from paramount, customers experience inconsistent units in branded products

also. This forces them to opt for interactive shopping, looking for more options

and experiencing products before taking them home, even in a repeat buying. In

addition to slow technology adoption, lack of confidence in brands is another

challenge online marketers face.

Beyond brands is a point of

confidence in brands. The confidence in a brand is also shaped by the protection

that consumers get in the form of their legislative rights. Consumers in the US

can return the merchandise after 30 days of purchase with no questions asked.

Although Indian consumers are also blessed with the same legislation, it is more

on paper than in practice. More than anything else, this is one area where

online marketers would find it hard to convince the prospects. When I cannot

trust a person even after interfacing with him or her face to face, can I trust

a website with an obscure progeny?

The last word

With such a

consumer mindset, marketers selling online would be required to answer who

are they. So, selling online may have advantages such as better inventory

management, low set-up costs and so on, but the challenges are even harder. The

challenge lies in building faith in technology where the consumer feels at home

or rather at ‘store’ while on your website. The challenge is to create a

brand that customers can relate to and are confident to buy without the fear of

ordering silk and getting linen instead. The challenge for marketers then is to

focus their efforts on building the necessary environment and relationships with

the customer before getting them to shop online. Then, perhaps, Mr Bezos can

fulfill his dream of selling everything through the internet, in India.

Gaurav

Chadha Associate Consultant Learning

Technologies Business, NIIT

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