E-commerce is booming, especially in India. It is expected to touch more than seven and a half billion in 2015, an increase by a whopping forty five percent. With online firms sweetening the sales with great offers and discounts, more and more people are changing their shopping pattern. Many can now get a retail therapy fix by simply browsing through the various e-commerce websites without even having to move out of their chair. Added attraction is that you do not have to necessarily buy anything.
Sensing the trend, e-commerce majors have invested heavily in their ventures. Flipkart has received many millions in foreign direct investment and so has Amazon India, the two major e-commerce companies in India. About three billion dollars was invested into e-commerce ventures by individuals, companies and private equity firms. The flow of funds is expected to continue and maybe even become stronger in 2015. The mergers and acquisitions activity is also seen maximum in this space with Jabong, Myntra and many second line e-commerce companies being seen as takeover targets.
Last year, the country had witnessed a turnover of about four and a half billion in e-commerce retail. And this is expected to grow in leaps and bounds in 2015. While one of the main attractions in online shopping is being able to browse slowly and find the exact product you want along with the best deal for it, the biggest draw to e-commerce sites is the massive discounts offered by them. This has been the target of attacks by the brick and mortar sales, but for now there seems to be not stopping the e-retain bandwagon. Whether they will all hike prices and discounts after having captured market share and after having edged out the physical stores remains to be seen. They are already being accused of predatory pricing and pricing below cost.
Reports also suggest that e-commerce firms are expected to spend close to two billion dollars towards improving logistics, infrastructure and warehousing. These firms have also been a source of employment to India’s growing educated youth. Increasingly people are turning to online shopping for a variety of reasons – lack of time, convenience, wider choice and great discounts. They can compare features and costs. Many of the e-retailers also offer cash back on some deals. And many stores that offer online sales also have a liberal return policy.
There is a great churning in the online shopping sector. Big names are entering the fray. Millions are pouring in by way of investment. There is a shakeout in terms of players involved. The mergers and acquisitions activity has also increased. Prices of products are falling and discounts are increasing; there is solid competition between the e-commerce giants. In the milieu, brick and mortar retailers are bruised. All in all online savvy shoppers are having a great time and making merry. Let the ordinary consumer enjoy, so long as the going is good for him….is what the business community and e-commerce giants have to say.