About INgene blog : First ever Indian Youth trend Insights blog

About INgene : First ever Indian Youth trend Insights blog:
This blog explores the detailed characteristics of Young-India and explains the finer & crucial differences they have with their global peers. The blog also establishes the theory of “adopted differentiation” (Copyright Kaustav SG,2007) and how the Indian & Inglodian youth are using this as a tool to differentiate themselves from the “aam aadmi” (mass population of India) to establish their new found identity.

The term youth refers to persons who are no longer children and not yet adults. Used colloquially, however the term generally refers to a broader, more ambiguous field of reference- from the physically adolescent to those in their late twenties.
Though superficially the youth all over the world exhibits similar [degree of] attitude, [traits of] interests & [deliverance of] opinion but a detailed observation reveals the finer differential characteristics which are crucial and often ignored while targeting this group as a valued consumer base. India is one of the youngest countries in the world with 60% of its population less then 24 years of age and is charted as the most prospective destination for the retail investment in the A. T. Kearney’s Global Retail Opportunity Report, 2007. With the first ever non-socialistic generation’s thriving aspiration & new found money power combined with steadily growing GDP, bubbling IT industry and increasing list of confident young entrepreneurs, the scenario appears very lucrative for the global and local retailers to target the “Youngisthan” (young-India). But, the secret remains in the understanding of the finer AIOs of this generation. The Indian youth segment roughly estimates close to 250million (between the ages of fifteen and twenty-five) and can be broadly divided (socio-psychologically) into three categories: the Bharatiyas, the Indians & the Inglodians (copyright Kaustav SG 2008). The Bharatiyas estimating 67% of the young population lives in the rural (R1, R2 to R4 SEC) areas with least influence of globalization, high traditional values. They are least economically privileged, most family oriented Bollywood influenced generation. The Indians constitute 31.5% (A, B,C, D & E SEC) and have moderate global influence. They are well aware of the global trends but rooted to the Indian family values, customs and ethos. The Inglodians are basically the creamy layers (A1,A SEC) and marginal (1.5% or roughly three million) in number though they are strongly growing (70% growth rate). Inglodians are affluent and consume most of the trendy & luxury items. They are internet savvy & the believers of global-village (a place where there is no difference between east & west, developing & developed countries etc.), highly influenced by the western music, food, fashion & culture yet Indian at heart.

Friday, June 29, 2012

e commerce in India : the current scenarios

Apart from booking flight / train tickets/ paying bills (as tht's cumbersome process offline), buying books from amazon (after noting that the book is not available at local book shop) or booking movie tickets(it's cool to surprise your counterpart with the "smartness" of "online booking") the country is not yet comfortable to transact online. Reliability is the core, that lacks currently. Then comes the after sale service... replacement as well as smooth / uncorrupted money transaction. online business has to earn the faith of people.. As stated by the blogger Sriram Vadlamani " I have booked train tickets on IRCTC, bus tickets on Redbus and ordered books on Flipkart. That was a neat little circle I have drawn around me for eCommerce. For the first time, I came out of my comfort zone and ordered a Samsung camera on Yebhi.com. What followed is my biggest nightmare and probably the nightmare of many consumers as well...."

Zinnov consultancy report has placed  e-commerce at only 12 per cent of total retail sales in India.

here's a report as published in The Hindu newspaper:

Only a small fraction of the roughly 5 million Internet users in the late 1990’s even transacted online. Faltering dial-up connections and text-only browsing made the purchasing process cumbersome. Credit card usage was limited to a few, and even fewer were ready to disclose their card details over the Web.
The economics of online commerce, however, have changed so much since then, that Rana Athreya is now attempting to cut the Gordian Knot of e-commerce — setting up an Internet pet food store.
In 2011, Mr. Athreya co-founded Dogspot.in, a Gurgaon-based start-up that shipped over 35,000 kg of dog food last year. 

“A number of factors over the last decade have given us the chance to prove that the pet category can be successful online,” said the 30-year-old entrepreneur. Dogspot.in hopes to break-even next month, ending the year with sales of Rs.3 crore. Online pet stores are always mindful of the tale of Pets.com Inc, a publicly-traded firm in the U.S. that sold pet products online and then went onto become a popular victim of the dot-com bust over 10 years ago. The California-start-up, founded in the late 1990’s, raised over a hundred million dollars and went public in 2000.
After spending millions on marketing, it burnt through most of its cash and laid off over 200 employees — eventually shutting down in late 2000. Today, Dogspot has 10 employees compared to the 350 that Pets.com had and aims to become a $40 million company by 2015. A combination of factors, including a better ecosystem, increased credit card penetration and a jump in Internet users has made this possible.
A new litter of online-only niche product stores, including groceries, women’s apparel and sporting goods have emerged over the last two years. 

Backed by venture capital firms in some cases, these start-ups represent how the economics of selling merchandise over the Internet have evolved since the late 1990s. Over the last ten years, the cost of almost every aspect of launching an e-commerce website has plummeted. 

Plummeting costs
A large part of dropping costs comes from the boom of a tech-ecosystem that takes care of website creation, site hosting and the servers that are required to create an e-commerce portal.
Overall, it is ten times easier to launch an online retail business than it was a decade ago, says Suneet Manchanda, former Business Development Head, SifyMall Ltd.
“Back when we were setting up SifyMall, the technology and people who could build a website were hard to find. Furthermore, the companies who could create it were expensive to source from, it was a costly nightmare,” he said.
The rise of businesses such as Amazon’s web services allows companies to rent computer power and storage, reducing the need for start-ups to buy their own servers.
Mr. Manchanda said it cost anywhere between Rs.20 lakh and Rs.25 lakh to start up SifyMall and took over six months before it could go live. Now, it would cost Rs.3 lakh and could be live in 10 days, eliminating the need for investors or loans. Mr. Manchanda, last year, founded an online luxury women’s apparel store (ladyblush.com). 

Easier logistics
Another advantage is the growth of a cottage industry that helps in logistics, mainly storing and shipping of products. A common complaint of the Indian e-commerce industry is the huge damage and losses that companies incur in shipping while using India Post.
New shipping start-ups such as Delivery.in or Chhotu.in, however, offer logistics that are better tuned to the e-commerce industry by reducing damage losses to less than one per cent, calling customers before delivery and charging their clients only when they make a sale.
“Something that sets us apart from India Post or even major courier companies is that we are a straight business-to-business company. This allows us to reduce our capex, letting us charge much lesser rates.
“We are a natural logistics extension for e-commerce companies,” said Navneet Singh, CEO, Chhotu.in.
“Right now, close to half of our customers are start-ups. Our services complete this whole ecosystem that lets them really thrive,” he added.
According to Abraham Koshy, who founded an online sports goods store last year, it took less than Rs.3 lakh to launch the company, excluding buying inventory. He was able to hire outside software engineers to create the website, shopping-cart system and paid a few thousand rupees for Internet service. Setting up warehouses has also become relatively easier, with third-party companies charging a storage and per-shipment fee, allowing start-ups to reduce costs.
“It’s become increasingly easy to join the field without large investment. Take a simple thing like payment gateways for example. The (payment gateway) charges on customer credit card use have dropped from 6- 8 per cent to around 2 per cent over the last ten years or so,” said. Mr. Koshy, who left his job at Amazon Inc two years ago. 

While competition has become increasingly fierce due to dropping costs, there are already signs of consolidation among the bigger players in the market.
Flipkart bought Letsbuy, a rival firm, for a reported Rs.100 crore. A few months later, Snapdeal bought online sports retailer Esportsbuy.com, for an undisclosed amount.

A info-graphic by Track.in :

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