Don’t ignore India as an e-commerce up-and-comer


With the second largest global population at 1.2 billion people, India is a market which holds great potential for many e-commerce retailers. Online shopping is a growing trend  with Indian sites like Lenskart, Jabong, Myntra, Zovi, Bewakoof and others becoming increasingly popular. Cross-border shopping is also a growing trend for Indians looking for greater variety, flexibility and coveted western brands.

The Indian demographic is predominantly on Facebook with over 80 million users. According to Frost and Sullivan, 67% of Indian online shoppers refer to social media before buying online. Peer references have a huge influence on buying behavior, as do social media ads.

Brands  interested in growing their influence in India should concentrate their time on Facebook. When reaching an Indian audience, Facebook is the platform to engage and advertise on. Additionally, brands that incorporate the Indian culture  into their marketing efforts are definitely appreciated.

However, penetrating the Indian market doesn’t come without its challenges.  According to the Borderfree Index report, Indians spend very little time on retail sites, the lowest of the BRIC countries, and online sales only make up for about 1% of total retail. Another major barrier to entry for retailers is shipping. 42% of online shoppers abandon their shopping carts because of shipping cost. Underdeveloped physical delivery infrastructure make for some of the highest logistics costs in the world. For this reason, many e-commerce retailers have set-up warehouses in India to help cushion the costs. Lastly, only 2% of Indian consumers have a bank account or credit card. Many Indian e-commerce sites offer Cash-On-Delivery services which can be costly.

Now, I would not recommend completely ignoring India as an e-commerce destination. Start small and focus solely on brand awareness. Interact and advertise on Facebook. Review your metrics report and go from there.

The  numbers of oversea shoppers will continue to increase as the infrastructure in India becomes more robust. It is predicted that by 2017, Indian consumers will spend more online than US consumers.

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