Growing Indian Confidence

Growth of Internet penetration in India, though not very healthy, has
resulted in an increase in the number of users going to the web to do
some kind of transaction. Amongst all Asia Pacific Internet users, the
Visa survey found that Indians are more satisfied with online shopping.
Surprising part is that the data comes at a time when the economic
environment is not that positive. Another piece of data which has
emerged relates to security.
This has been the most important deterrent for any online shoppers
worldwide, particularly Indians. But the survey clearly suggests that
Indian consumers showing high degree of satisfaction  with the
security aspect of online transaction.

Talking about security improvements
and verified by Visa initiative, Uttam Nayak, Country Manager, Visa,
South Asia, says, “We introduced Verfied by Visa in 2004
based on 3D Secure protocol thereby ensuring that the consumers in
India had a secure shopping experience. It was developed by Visa and it
was licensed for industry to be interoperability for common standards.
Mastercard and other company also uses this protocol. “

Most credit card companies like Visa and Mastercard are focussing in
India considering India’s population and growth of Internet
penetration, apart from technology advancement and above all the
quality of services that is ofered by the Indian telecom service
providers. The e-Commerce Consumer Monitor study  focused on
key elements such as e-Commerce
Internet usage, online shopping and cross-border shopping, bill payment
methods and monthly diagnostics.

The survey found that the top three reasons for shopping online
were the freedom to shop
anytime, the ability to compare prices and save money and save time.
The survey also provided some data on spending pattern by Indian online
shoppers. Study suggests that Indians spent an average of $2,086 in the
last 12 months. The average spent from APAC region was $2,526 during
the same period.

Another interesting trend which emerged was that Indians were flocking
to international eCommerce
for better deals. But the
primary reason for Indians going this way was the lack of availability
of products they were looking for on the Indian sites.  Other
factors for this were, products available were cheap and there were
more discounts. 51 percent of Indians surveyed did shopping on US based
eCommerce websites. Indians were also found to be more concerned about
the security of cross border transaction than their APAC counterpart.
The increased confidence level of Indian shoppers were attributed to
the awareness programs being organized by various banks in India
through promotions and media advertisements.

Most popular online purchase item for Indians was music followed by
travel related items. But travel related service was the biggest
category and it accounted for highest share of spend. According to
survey, respondents spent $1,469 in last 12 months on travel
related  services. The survey also revealed airline ticket,
online travel agents, and travel accomodation as the top three travel
categories for eCommerce.  According to Uttam Nayak of Visa,
“Being able to search for a good deal, compare prices, and
save money is definitely a driver for consumers to go online.”

Given the trends indicated in the survey, it looks like Indians are all
set to increase their exposure to eCommerce. Banks in India have done a
fairly good job in educating Indians about the security aspect, but
more needs to be done. Mobile banking applications are still to be much
success as the ‘fear’ factor of transaction from mobile phone continues
to remain a hurdle.

travel related eCommerce (%)

of Spend      
      Average Spend ($)

Airlines/airline tickets



Travel information (without booking function)



Travel Accommodation



Online Travel agents (with booking fuctions
and trip info)



Other types of transportation for traveling



eCommerce Consumer Monitor 2009

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