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Online shopping websites are rapidly gaining traction as consumer mentality is changing very fast.
Gone are the days when old and young alike visited their favourite departmental stores to pick up brands they liked most.
With the advent of e-commerce, this phenomenon is diminishing by the day, as most retailers are pushing their products to e-marketplace or online shopping portals.
To substantiate this fact, a survey done by industry body Assocham shows that online retail jumped 88 per cent to $16 billion in the year gone by. Industry watchers say it will breach the $50 billion market by 2017.
Why is online shopping outpacing brick-and-mortar stores
Says Radhika Aggarwal (below left), co founder and corporate vice president (marketing & merchandising) at ShopClues.com, “Online experience is gaining momentum simply because of timely product deliveries along with cash-on--delivery payment system. Consumers prefer to shop from home at the click of a button to save time.”
This business module is cost efficient, easily accessible and profitable in many functional areas.
With realty price shooting up in metro cities, a handicraft merchandiser or a ready-to-wear garment manufacturer needs to shell out huge rentals to run a shop for instance in New Delhi’s Khan Market or Mumbai’s Hill Road in western suburbs. Why will he not sell his merchandise via our website where he can reach out to wider consumer base?” she questions.
She further says that the Delhi-based firm is constantly thriving to reach out to every distant town as India's vast young population is rapidly embracing the internet.
Changing mindset
Indian shoppers have a mindset of seeing or having a demo of the product before buying it. But this trend is gradually phasing out because of credibility that online retaillers display.
First timers have always had a better shopping experience online than buying in a shop, informs Aggarwal.
On competition from industry players like Snapdeal and Flipkart
Online market is growing exponentially and each player can grab a slice of the market provided it consistently innovates, wins trust of consumers and is available for after-sales service, asserts Aggarwal. “Our diversified product offering from genuine dealers gives us an edge over other firms,” she adds.
What drives buyers to ShopClues
We have introduced a ‘flea market’ concept where we offer huge discounts on limited products on Sundays. On an average, we have 45,000 visitors to our website which displays merchandise from over 2000 retaillers.
Most importantly, we not only sell high end brands but also a basic product like a mosquito repellent or a hand wash which can be in high demand in smaller towns. We have tied up with logistics companies to deliver products on-time to remote areas as well.
Inventory analysis of ShopClues
35,000 merchants sell their wares via the platform
2,025 product categories are available for shoppers to choose from
4 million products including electronics-to-home gadgets—to-- clothing etc.
Rs 22,000 core (Rs 220 billion) worth of merchandise that are listed on the site
Revenues, growth target
The firm recorded over Rs 300 crore (Rs 3 billion) revenues in 2013 and is hopeful of doing better in ensuing year.
With an initial investment of Rs 93 crore (Rs 930 million) by Helion Venture Partners and Nexus Venture Partners, the three-year old firm is confident of breaking-even before 2015.