FlipKart, Snapdeal, Myntra, FashionAndYou, infibeam, HomeShop18, inkFruit, ebay, Firstcry, hoopos, babyoye, bigbasket, 99labels, jabong,... the list of Indian ecommerce sites keeps growing every day.
FlipKart has raised over USD 100 Million, Myntra just raised USD 25 Million recently, snapdeal raised over USD 40 million a year ago, another USD 40 Million by FashionAndYou late last year - the investments have been coming thick and fast.
VC companies like Tiger Global Management, Accel partners, Norwest Venture partners, Intel Capital, Bessemer Venture Partners, Nexus Venture Partners, IndoUS Venture partners and a host of other top-notch venture capital companies have poured in literally hundreds of millions of dollars as a mark of faith in the Indian buyer.
Given the frenetic activity going on in this space, one would think all is well in the Indian ecommerce space. But the truth is no one is sure yet who will win this battle or even if any of them will win this battle at all.
This doubt and worry is not due to any of the usual problem areas such as quality of goods, customer experience, ease of payment, or execution. The teams in most of the leading ecommerce sites have actually nailed these issues. Finding what you want, buying it online and getting it delivered (usually well ahead of time) is as smooth as you can expect. The problem is not related to the size of the market, or number of people with credit cards or the reluctance of the typical Indian to buy online without touching and feeling the product. A growing middle class, Cash On Delivery facilities and attractive prices have gradually eroded all these impediments, so much so that it is now believed that the Indian ecommerce market will be over USD 250 Billion by the year 2025!
So what truly ails the Indian ecommerce sector? The real problem lies in the collective behaviour and psyche of the Indian - something that may not change for the foreseeable future. Understanding the Indian mind and finding innovative ways around these essentially Indian problems is the only way to tilt the balance. Just increasing volume of sales will not cut it if every individual transaction is making a loss!
Here are a few ground realities about us Indians that we need to accept.
1. Customer delight hinges on only one criterion - price. No matter how good the user experience on your site is, no matter how quickly you delivery, no matter how good your product is, or how generous your return policy, if another site is even a Rupee cheaper, we will go there. Of course, you can still screw up, but you will get that opportunity only if you have been the cheapest option in the first place.
2. Customer loyalty is non-existent. However great our experience was with your site during our last transaction(s), do not expect us to swear allegiance to you. Price is still king. Then again, if you screw up badly, we will complain vociferously, but we might still quietly come back to you the next time if you are still the cheapest. We have very short memories.
3. User engagement is a pipe dream. Do not expect any meaningful or substantial response to your overtures from us. We are largely passive consumers of information rather than active participants or providers of information. Take a look at the comments section of any site not related to politics, cinema or cricket if you want any proof. Or look at the Indian contribution to the open source initiative. Even on seriously niche sites populated with "sophisticated" Indians, most comments are inane and add no value. (Check out the comments on India Nature Watch, for example. It is a site where people share their nature photographs. Most comments will be "awesome!", "Too good", "Great shot" and "Super". You will not find any meaningful dialogues.)
4. Bad behaviour is not the exception (nor the rule, to be fair). We will promise to be at home at the time of delivery and then not be there. We will agree to pay at the time of delivery and then try to bargain with the courier and return the product when the courier is unable to give a discount! We will return products on a whim, just because we can, but will make the collecting courier come three times before we handover the returned items! We will even use the items and then return them if we believe we can get away with it! Not all of us will do this nor will we do this all the time - just often enough to hit you where it hurts.
Am I being too harsh and too cynical? Use the comments section and let me know - if you can push yourself to do so :)