Online revenue sales set the cash registers ringing for India’s e-tailers

A majority of businesses are very keen on adopting online platforms for increased revenue sales in India. Over 54% of businesses reported a growth of more than 20% since going online in revenue sales. These were the findings from a research study conducted by strategic market research consultancy Spire Research and Consulting spanning from August to October 2014. The full report is also available upon request.

The research study aptly titled, ‘India’s E-Tailing Industry – Seller’s Perspective’ was released at a press conference held in New Delhi today. The study was conducted across 13 states in India spread over 300 retailers in 3 sectors consisting of apparel, consumer electronics and food. These insights concentrated on current online shopping trends and its effect on sellers. Furthermore, the data was gathered through one-on-one, online and telephonic modes of communication.

More businesses are going online and using it as an extension of their brand

As shown in Table 1 above, Spire’s study revealed majority of businesses have accepted online platforms as an extension of their brand. Businesses in the apparel (82%) and food (80%) sectors seem to have an advantage by going online as compared to consumer electronics (72%). Moreover, consumer electronics seem to have a lower potential as consumers are more inclined to be involved in the purchasing process.

There is expected growth from other sectors as well which consist of baby products, books, home décor and jewelry. Japnit Singh, Senior Director, Singapore and India of Spire Research and Consulting commented by adding in, “We are pleased to introduce this study on the e-tailing space, considering the country is one of the fastest growing markets for e-commerce globally. The research clearly shows that, sellers in India have a positive sentiment towards e-commerce with maximum traction seen in apparel and food businesses. Our study clearly indicates a growing trend towards adoption of online channels. Over 50% of businesses accounting for significant revenue share from online sales even right now, with revenue shares set to rise significantly over the next five years.”

Most businesses expected to benefit from online sales

As shown in table 2 above, most businesses are leveraging online sales to gather up to 20 – 50% revenue due to emergence of more online specialists, convenient payment modes and increased awareness among inexperienced sellers. Spire forecasts that by 2020, 45% of businesses will see their online share grow to between 20 – 50% of sales.

Challenges for sellers in e-tailing industry

Despite challenges – e-tailing is set to grow further. There were relatively few obstructions faced by sellers/respondents when Spire conducted the study which consisted of:

Lack of robust payment mechanisms

Cash On Delivery (COD) options were prone to risks as well as payment delays

Difficulties in logistics and order placements

Challenges for sellers in e-tailing industry

On the other hand, businesses were expected to gain sales revenue from traditional/offline channels with sellers following a dual strategy of combining online with offline sales. Furthermore, the report also revealed the e-tailing space would eventually be dominated by a few large capital heavy organizations given the need for nationwide logistics infrastructure and a currently limited consumer base. At the same time, Tier 2 and Tier 3 cities were expected to have a faster adoption rate with greater sales margins derived directly from online channels. Furthermore, these channels will follow integrated strategy combining both offline and online sales.

Conclusion

The Spire study revealed that over 54% of businesses reported a growth of more than 20% in revenue sales since going online. Now widely accepted as an extension of any brand – online channels are raking in the moolah. With the study covering 3 major sectors – businesses in the apparel and food industries had more profits than those in the consumer electronics sector.

Spire believes that despite challenges such as lack of robust payment infrastructure, risk in COD payment options and difficulties in logistics as well as order placements – the e-tailing industry in India is poised for growth. Moreover, the study gives clear indications of an emerging trend towards adoption of online channels – with over 50% of businesses accounting for significant revenue share from online sales.

https://www.spireresearch.com/newsroom/media/online-revenue-sales-set-the-cash-registers-ringing-for-indias-e-tailers/

Egyptian-Israeli gas deal to boost bilateral trade

A USD15 billion deal has been announced between Israel and Egypt to export natural gas. Israel’s Delek Group has signed an agreement to supply 64 billion cubic meters of gas in a span of ten years to Egypt’s Dolphinus Holdings. The deal is considered a milestone ever since the 1979 peace accord, bringing Egypt a step closer to becoming a regional energy hub. However, the transportation of natural gas from Israel to Egypt is a challenge given the security risks. Will the Egypt-Israel gas export deal usher in a relationship of bonhomie and economic co-operation? Read more here: https://www.spireresearch.com/newsroom/spirethoughts/egyptian-israeli-gas-deal-to-boost-bilateral-trade/

Spire speaks on Omni-channel strategies for Indonesian retailers

Spire was honored to participate in the Samsung Top Achiever Retailer (STAR) event held on 22 August, in Jakarta. Albertus Edy Rianto, Senior Manager, Spire Indonesia, shared his insights on the significance of Omni – channel strategies for mobile phone retailers. Albertus discussed offline-to-online strategy, where multiple channels merge to help target customers across various channel platforms. He elaborated that more than 80% of Indonesian mobile phone retail sales in 2020 will still occur at physical outlets. However, 71% of Indonesians browse online for a while prior to shopping at a physical store. Factors that influence customers include better delivery conditions, storefront apps for better sales and even packaging. As customers become more tech-savvy and demanding, more consideration will be given to innovative payment processes and browsing more than one channel to make a purchase. As far as online purchases are concerned, 25% of customers still feel ...

Asia-Pacific nations poised to sign the world’s largest multi-lateral trade agreement, RCEP, in 2020

After six years of negotiations, more than a dozen countries in the Asia-Pacific are poised to sign the world’s largest trade agreement, known as the Regional Comprehensive Partnership (RCEP), in 2020. This agreement would boost commerce among participating countries by lowering tariffs as well as standardizing customs rules and procedures. The RCEP will widen market access, especially for those countries that do not have existing many bilateral trade agreements in place. Will India pay a price for its decision to stay out of the RCEP? Read more: https://www.spireresearch.com/newsroom/spirethoughts/asia-pacific-nations-poised-to-sign-the-worlds-largest-multi-lateral-trade-agreement-rcep-in-2020/

Prison ankle bracelets are all the rage in Brazil

With about 622,000 inmates, Brazil is home to Latin America’s largest and the world’s fourth largest prison population. Around 32,000 criminals sport one of the many types of ankle bracelets being used. Many others are on a waiting list. The authorities estimate that they can save anywhere from USD12,000 to USD 72,000 a year for every tagged inmate removed from prison. Will ankle bracelets allow more prison inmates to serve their sentences from home? https://www.spireresearch.com/newsroom/spirethoughts/prison-ankle-bracelets-are-all-the-rage-in-brazil/

Germany: The Eurozone’s economic powerhouse

Germany is the fourth largest global economy today. Its exports amounted to EUR107 billion in March 2015 – an all-time high since the 1950’s. Despite being the only European nation with a strong manufacturing base and rising employment rate, will Germany succeed to drive Eurozone’s stagnant economy? And what lessons does Germany’s economic success hold for the rest of the world? Germany’s resurgence With the second lowest unemployment rate in the European Union (EU) at 5.3 per cent, Germany’s economy has survived many setbacks. The economic success dates back to the Industrial Revolution due to the early adoption of coal production and rail transportation. Moreover, the fall of the Berlin Wall – the reunification of West and East Germany – and the expansion of the EU created huge market opportunities for Germany. Often regarded as the ‘Sick man of Europe’, Germany had almost lost hope of returning to rapid economic growth, undergoing recessions in 2003 and a dismal 1.2 p...

The Knowledge to Decide

Search This Blog