Pratisha Resereach Report
Pratisha Resereach Report
3. Challenges 9
4. Analysis 10
5. Suggestions 21
6. Conclusion 22
7. References 24
E-Commerce Industry
E-commerce (electronic commerce) is the activity of electronically buying or selling
of products on online services or over the Internet. The term was coined and first
employed by Dr. Robert Jacobson, Principal Consultant to the California State
Assembly's Utilities & Commerce Committee, in the title and text of California's
Electronic Commerce Act, carried by the late Committee Chairwoman Gwen Moore
(D-L.A.) and enacted in 1984. Electronic commerce draws on technologies such as
mobile commerce, electronic funds transfer, supply chain management, Internet
marketing, online transaction processing, electronic data interchange (EDI), inventory
management systems, and automated data collection systems. E-commerce is in turn
driven by the technological advances of the semiconductor industry, and is the largest
sector of the electronics industry.
Modern electronic commerce typically uses the World Wide Web for at least one part
of the transaction's life cycle although it may also use other technologies such as e-
mail. Typical e-commerce transactions include the purchase of online books (such as
Amazon) and music purchases (music download in the form of digital distribution
such as iTunes Store), and to a less extent, customized/personalized online liquor store
inventory services. There are three areas of e-commerce: online retailing, electronic
markets, and online auctions. E-commerce is supported by electronic business.
• Online shopping for retail sales direct to consumers via Web sites and mobile
apps, and conversational commerce via live chat, chatbots, and voice assistants;
• Gathering and using demographic data through web contacts and social media;
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• Business-to-business (B2B) electronic data interchange;
• Marketing to prospective and established customers by e-mail or fax (for
example, with newsletters);
• Increased selection. Many stores offer a wider array of products online than
they carry in their brick-and-mortar counterparts. And many stores that solely
exist online may offer consumers exclusive inventory that is unavailable
elsewhere.
• Limited customer service. If you are shopping online for a computer, you
cannot simply ask an employee to demonstrate a particular model's features in
person. And although some websites let you chat online with a staff member;
this is not a typical practice.
• Lack of instant gratification. When you buy an item online, you must wait for it
to be shipped to your home or office. However, retailers like Amazon make the
waiting game a little bit less painful by offering same-day delivery as a
premium option for select products.
• Inability to touch products. Online images do not necessarily convey the whole
story about an item, and so e-commerce purchases can be unsatisfying when
the products received do not match consumer expectations. Case in point: an
item of clothing may be made from shoddier fabric than its online image
indicates.
The Indian e-commerce industry has been on an upward growth trajectory. The online
retail market in India is estimated to be 25% of the total organized retail market and is
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expected to reach 37% by 2030. By 2034, it is predicted to surpass the United States
to become the second largest e-commerce market globally.
In order to tap onto the large market, the e-commerce industry has also seen an
increase in innovation across platforms, and ancillary segments such as logistics. The
market has become conducive grounds for testing various business models such as
inventory, social networks, aggregator, and e-commerce marketplace model, among
many others.
Further, out of nearly 100,000 pin codes in India, online retailers deliver to 15,000 to
20,000 pin codes. The e-commerce trend is gaining major popularity even in the tier-2
and tier– 3 cities as they now make up nearly half of all shoppers and contribute three
of every five orders for leading e-retail platforms. The average selling price (ASP) in
tier-2 and smaller towns is only marginally lower than in tier-1/metro cities.
Electronics and apparel make up nearly 70% of the e-commerce market, when
evaluated against transaction value. Other upcoming categories are baby products,
furnishing, personal care, food and groceries.
If you’re starting an ecommerce business, odds are you’ll fall into at least one of these
four general categories.
Each has its benefits and challenges, and many companies operate in several of these
categories simultaneously.
Knowing what bucket your big idea fits in will help you think creatively about what
your opportunities and threats might be.
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1. B2C – Business to consumer.
B2C businesses sell to their end-user. The B2C model is the most common business
model, so there are many unique approaches under this umbrella.
The decision-making process for a B2C purchase is much shorter than a business-to-
business (B2B) purchase, especially for items that have a lower value.
Think about it: it’s much easier for you to decide on a new pair of tennis shoes than for
your company to vet and purchase a new email service provider or food caterer.
Because of this shorter sales cycle, B2C businesses typically spend less marketing
dollars to make a sale, but also have a lower average order value and less recurring
orders than their B2B counterparts.
B2C innovators have leveraged technology like mobile apps, native advertising and
remarketing to market directly to their customers and make their lives easier in the
process.
For example, using an app like Lawn Guru allows consumers to easily connect with
local lawn mowing services, garden and patio specialists, or snow removal experts.
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Additionally, home service businesses can use Housecall Pro’s plumbing software app
to track employee routes, text customers, and process credit card payments on the go,
benefitting both the consumer and business alike.
In a B2B business model, a business sells its product or service to another business.
Sometimes the buyer is the end user, but often the buyer resells to the consumer.
B2B transactions generally have a longer sales cycle, but higher order value and more
recurring purchases.
Recent B2B innovators have made a place for themselves by replacing catalogs and
order sheets with ecommerce storefronts and improved targeting in niche markets.
In 2020, close to half of B2B buyers are millennials — nearly double the amount from
2012. As younger generations enter the age of making business transactions, B2B
selling in the online space is becoming more important.
In this ecommerce model, a site might allow customers to post the work they want to
be completed and have businesses bid for the opportunity. Affiliate marketing services
would also be considered C2B.
Elance (now Upwork) was an early innovator in this model by helping businesses hire
freelancers.
The C2B ecommerce model’s competitive edge is in pricing for goods and services.
This approach gives consumers the power to name their price or have businesses
directly compete to meet their needs.
Recent innovators have creatively used this model to connect companies to social
media influencers to market their products.
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A C2C business — also called an online marketplace — connects consumers to
exchange goods and services and typically make their money by charging transaction
or listing fees.
Online businesses like Craigslist and eBay pioneered this model in the early days of
the internet.
C2C businesses benefit from self-propelled growth by motivated buyers and sellers,
but face a key challenge in quality control and technology maintenance.
If your business model is the car, then your value delivery method is the engine.
This is the fun part — where you find your edge. How will you compete and create an
ecommerce business worth sharing?
Here are a few of the popular approaches taken by industry-leaders and market
disruptors.
By cutting out the middleman, a new generation of consumer brands have built loyal
followings with rapid growth.
Online retailers like Warby Parker and Casper set the standard for vertical disruption,
but brands like Glossier are showing us how D2C can continue to be an area for
innovation and growth.
To “white label” is to apply your name and brand to a generic product purchased from
a distributor.
In private labeling, a retailer hires a manufacturer to create a unique product for them
to sell exclusively. With private labeling and white labeling, you can stay lean on your
investments in design and production and look for an edge in technology and
marketing.
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3. Wholesaling.
4. Dropshipping.
Typically, dropshippers market and sell items fulfilled by a third party supplier, like
AliExpress or Printful. Dropshippers act as a middle man by connecting buyers to
manufacturers. Easy-to-use tools allow BigCommerce users to integrate inventory
from suppliers around the world for their storefronts.
5. Subscription service.
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OBJECTIVE OF ANALYSIS
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CHALLENGES IN ANALYSIS
There were few challenges that were been faced during the project work on the
Ecommerce Industry: -
• One of the major challenges during the analysis was the collection of primary
data (original data) related to the study.
• Searching the accurate data related to the study was another challenge.
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ANALYSIS
The Covid19 pandemic also known as the coronavirus pandemic emerged in Wuhan of
China and was given an account of to the WHO (World Health Organization) on 31 st
December 2019. On 30th January 2020, Public Health Emergency was announced as a
global concern. Covid-19 name was given to this disease on 11 th February 2020. This
disease plays with the immunity of the human beings, Low immunity individuals are
directly affected by this.
The pandemic of Covid-19 is a major pitfall not only for the human’s health or life or
the economic conditions but also on the overall structured society which is not to be
changed to an another extend now. Various new things are introduced during this
pandemic some of which were their before but still were unknown which now have
developed a new scenario.
The National Emergency have not spare anyone each and every sector, each and every
section is being affected by it whether rich or poor. One of the sectors being affected is
the E-Commerce. The Transactions of Buying and Selling that is the business
transaction via the route of internet led to the evolution of E-Commerce or broadly as
Electronic Commerce. E-Commerce involves dealing with all sort of goods and
services over the internet. It is also known as the Internet Commerce because of the
way of its functioning online.
The taste, preferences, demand, needs of the consumers are now being shifted from
luxury to the basic ones, from the ones with the most comfort to the ones with the
need of just survival. All this had call for the economizing of all the resources of the
economy. There is a rise in the trust and demand for the E-Commerce industries in
order to be safe, secure and main motive of survival led to this increase.
The Coronavirus disease led to the social distancing which is why the traditional way
of shopping is being neglected in this phase. As going to a crowded place for shopping
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can make you purchase Covid-19 people avoid going that way rather prefer the
convenient and safer option of online shopping.
Methodology
The Thought process of the world is now changed with the covid19 pandemic which
also bought a change in the lifestyle of people as they are trying to adjust with the new
normal and all this led to give a push to E-Commerce industry as well. Covid19
provided E-Commerce with a new environment so as to expand their footprints with
quite a few challenges to overcome like productivity or the supply chain effectiveness.
Social distancing gave a positive impact on the E-commerce industries growth.
The following Table 1 shows the revenue earned by the companies in the Quarter 1 of
the previous and current year that is 2019 and 2020 has witness an increase even
though the economy is facing a downfall.
S.No. Company Revenue 2019 (Q1) Revenue 2020 Increase
(Q1)
Table 1
The paper studied the perspective of 67 people out of which 70.1% are females and
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29.9% males. 11.9% people are below the age of 20 years, 41.8% between 20-30
years, 28.4% between 30-40 years and 17.9% are above 40 years. The survey had
17.9% Respondents of business class, 20.9% of service sector, 44.8% students and
16.4% home makers. According to the family income of the respondents 1.5% had
below 10k, 10.4% between 10k-20k, 16.4% between 20k-30k, 22.4% between 30k-
40k and 49.3% above 40k.
The following Table 2 shows the first two questions asked to the respondents
according to which 73.1% people prefer online shopping and 46.3% people faced
problems while shopping online during covid19.
S,No. Question Yes No
2 Did You face any problem with respect to the supply of 46.3% 53.7%
the products while shopping online during covid-19?
Table 2
Further the respondents were asked regarding the change in the frequency of their
purchasing online during covid19.The graph 1 represents that 37.3% ensured that it
has increased whereas 6% shopped online for the first time, 29.9% said there is
decrease in their online purchases and 26.9% believed that there is no change.
Graph 1
Another aspect that was covered was related to the problem’s consumers faced while
shopping online due to coronavirus breakdown. The Graph 2 represent that 71.4%
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faced the issue of late delivery, 23.2% found the hike in prices, 3.6% believed that
their product is not available online and 1.8% received defective product.
2%
4%
23% Defective Product
Late Delivery
High Prices
Graph 2
The respondents were also asked about the element which influenced them to make an
online purchase. The graph 3 represents that 50.7% found it safer than traditional
shopping, 4.5% found it fast and convenient and 6% were attracted by the Brand
reputation.
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Graph 3
The respondents were asked about their preference during and after covid19 which has
shown a significant difference. Graph 4 shows their preference during covid19 and
graph 5 shows their preference after covid19.
Graph 4
Graph 5
This shows how much e-commerce is evolving even during covid19 pandemic as
people are preferring it more these days, whereas after all this clears more people will
be opting for traditional shopping. One of the reasons for this difference can be the
social distancing which is to be followed during these days.
The E-Commerce is now being opted more than ever it has shown a growth in the
frequency and number of purchases during the pandemic times. As people now wanted
a new and safer way for engaging, entertaining and saving themselves.
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INDIAN E-COMMERCE INDUSTRY REPORT
Introduction
E-commerce has transformed the way business is done in India. The Indian E-
commerce market is expected to grow to US$ 200 billion by 2026 from US$ 38.5
billion as of 2017. Much of the growth for the industry has been triggered by an
increase in internet and smartphone penetration. As of September 2020, the number of
internet connections in India significantly increased to 776.45 million, driven by the
‘Digital India’ programme. Out of the total internet connections, ~61% connections
were in urban areas, of which 97% connections were wireless.
Market Size
The Indian online grocery market is estimated to reach US$ 18.2 billion in 2024 from
US $1.9 billion in 2019, expanding at a CAGR of 57%. India's e-commerce orders
volume increased by 36% in the last quarter of 2020, with the personal care, beauty
and wellness (PCB&W) segment being the largest beneficiary.
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In India, smartphone shipments reached 150 million units and 5G smartphone
shipments crossed 4 million in 2020, driven by high consumer demand post-
lockdown.
In festive season CY20, the Indian e-commerce GMV was recorded at US$ 8.3 billion,
a significant jump of 66% over the previous festive season. Similarly, the Indian
ecommerce market recorded ~88 million users in festive season CY20, a significant
jump of 87% over the previous festive season.
Investments/ Developments
Some of the major developments in the Indian e-commerce sector are as follows:
• In February 2021, Flipkart partnered with Maharashtra State Khadi & Village
Industries Board and Maharashtra Small Scale Industries Development
Corporation to bring local artisans and small and medium businesses into the
ecommerce ecosystem.
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•
In January 2021, The Khadi and Village Industries Commission (KVIC)
unveiled eKhadiIndia.com, an e-commerce portal, which will comprise
>50,000 products, ranging from apparel to home décor.
•
In January 2021, the B2B e-commerce platform, Udaan raised US$ 280 million
(~Rs. 2,048 crore) in additional financing from new investors—Octahedron
Capital and Moonstone Capital. Prior to this, in October 2019, the company
raised US$ 585 million (~Rs. 4,280 crore) from Tencent, Altimeter, Footpath
Ventures, Hillhouse, GGV Capital and Citi Ventures. It is likely to deploy the
latest fund towards continued market creation of B2B e-commerce in India and
digitise more small businesses across the country.
•
Flipkart partnered with PayTM for its annual Big Billion Days Sale event in
October 2020, offering customers the convenience of making payments directly
through the latter's application with the bonus of receiving PayTM cashbacks
over and above Flipkart discounts.
•
Infibeam Avenues signed a contract with Oman’s second-largest bank, the Bank
of Muscat, to process the bank’s online card transactions of various payment
networks through its digital payment solution—CCAvenue Payment Gateway
Service in November 2020.
•
In November 2020, Amazon India announced collaboration with Hindustan
Petroleum Corporation Limited. Under this partnership, customers will be able
to book and pay for their LPG cylinders until the delivery.
•
In November 2020, Reliance Retail Ventures Ltd. (RRVL), a subsidiary of
Reliance Industries (RIL), acquired a minority stake of Urban Ladder Home
Decor Solutions Pvt. Ltd. for Rs. 182.12 crore (US$ 24.67 million).
•
In November 2020, Flipkart acquired Scapic, an Augmented Reality (AR) firm, to
boost user experience.
•
In November 2020, Amazon India has opened 'Made in India' toy store, in line with
the government's ‘Atmanirbhar Bharat’ vision. The store will allow
thousands of manufacturers and vendors to sell toys driven by the Indian
culture, folk tales and toys that promote creative thinking and are locally
crafted & manufactured.
Government initiatives
Since 2014, the Government of India has announced various initiatives, namely
Digital India, Make in India, Start-up India, Skill India and Innovation Fund. The
timely and effective implementation of such programs will likely support growth of E-
commerce in the country. Some of the major initiatives taken by the Government to
promote Ecommerce in India are as follows:
• National Retail Policy: The government had identified five areas in its
proposed national retail policy—ease of doing business, rationalisation of the
licence process, digitisation of retail, focus on reforms and an open network for
digital commerce—stating that offline retail and e-commerce need to be
administered in an integral manner.
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•
In October 2020, amending the equalisation levy rules of 2016, the government
mandated foreign companies operating e-commerce platforms in India to have
permanent account numbers (PAN). It imposed a 2% tax in the FY21 budget on
•
the sale of goods or delivery of services through a non-resident ecommerce
operator.
Heavy investment made by the Government in rolling out fiber network for 5G will
help boost E-commerce in India.
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Road Ahead
The E-commerce industry has been directly impacting micro, small & medium
enterprises (MSME) in India by providing means of financing, technology and
training and has a favourable cascading effect on other industries as well. Indian E-
commerce industry has been on an upward growth trajectory and is expected to
surpass the US to become the second largest E-commerce market in the world by
2034. Technology enabled innovations like digital payments, hyper-local logistics,
analytics driven customer engagement and digital advertisements will likely support
the growth in the sector. The growth in E-commerce sector will also boost
employment, increase revenues from export, increase tax collection by ex-chequers,
and provide better products and services to customers in the long-term. Rise in
smartphone usage is expected to rise 84% to reach 859 million by 2022.
According to Bain & Company report, India’s social commerce gross merchandise
value (GMV) stood at ~US$ 2 billion in 2020. By 2025, it is expected to reach US$ 20
billion, with a potentially monumental jump to US$ 70 billion by 2030, owing to high
mobile usage.
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SUGGESTIONS
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Reduce bottlenecks in the enabling environment for e-commerce, including
areas such as connectivity, trade, logistics and postal services.
CONCLUSION
E-Commerce industry is that force which cannot be ignored by any element of the
economy. Coronavirus pandemic proved that one of the major tools that can help
consumers during crisis is e-commerce. In order to maintain social distancing and
selfquarantine the consumers have become more reliable on the e-commerce industry.
In the questionnaire the respondents were asked to rate their experience of online
shopping before covid19 and also during covid19. The graph 6 shows the ratings of
consumers according to their experience before covid19. According to which 35.8%
rated 4 whereas 3% rated 1 and 3.9% as 5.
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Graph 6
The graph 7 shows the ratings of consumers according to their experience during
covid19. According to which 41.8% rated it as 3, 11.9% as 5 and 4.5% as 1.
Graph 7
The Commanders of E-Commerce needs to figure out the ways and means of not only
surviving but staying ahead for whole of the community. This pandemic led people to
get engaged with technology to deeper extend and so it paved a way for the
ECommerce growth as well. Electronic Commerce is Intensified by Covid19.
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