With the increase of internet and smartphone penetration, rapidly growing customers wealth, and ongoing digital transformation in India is the fastest-growing market for the eCommerce industry.
Ecommerce Statistics
It has predicted the Indian e-commerce industry to be worth $200 billion by 2026.
According to the same report, the number of Internet users is projected to increase from 604 million in 2018 to 829 million by 2021.E-commerce businesses received over $7 billion in VC and private equity in 2018.
Despite the funding, the majority of online retailers gained only a portion of their customers and focused more on retaining regular buyers rather than broadening their base.
Moreover, India remains largely a value-sensitive market, which means the margins in the sector are lower than in another global eCommerce marketplace. Therefore, establishing a cost-effective business model for Indian e-retailers is a daunting task.
Price battle in marketplaces:
As festivals approach, e-commerce markets provide substantial discounts and discounts on everything from household appliances and electronics to fashion and clothing. The aim being, to attract the average Indian online buyer, for whom discounts are the second most important factor influencing their shopping decision.
For large e-commerce companies, the price battle may not result in a question about their survival. For small retailers and start-ups, this business model is unsustainable and ends up hurting the balance sheet at year-end.
Unsold inventory
Almost all Ecommerce Website Development Companies in India rely on an inventory-based business model. To reduce their exposure to stocks, they work on a return sales basis with suppliers. This means that if a product is not sold within a stipulated time, the seller will take it back. While such arrangements work with 3,000 shipments a day, they're unmanageable.
The reason for this is that stock models buy products in advance. Annually, they are left with 12-15% unsold stock.
If you add the cost of storing these commodities, including the warehouse, hiring store and insurance managers, and security costs, it takes a major toll on the profits of the e-commerce corporation.
High returned-to-origin
RTO refers to undelivered orders of an e-commerce company. The number usually grows when managers, responsible for shipping and delivery, set high daily targets for their staff.
When delivery agents are unable to deliver some of the orders, label them as RTO. RTO represents 25 to 40 percent of merchandise sold online. One return policy is the standard commercial policy. Ecommerce is by no means a profitable Enterprise E-commerce Solution. That said, technological solutions are proving to be opportunities that are used in eCommerce to lower their costs.
Opportunities
Address correction:
The Indian addresses are not structured. Customers eventually enter incorrect addresses (such as the wrong city name or pincode) or incomplete information (such as missing street names). Wrong addresses delay orders, which hurts the brand's reputation.
With the aid of machine learning, e-commerce businesses can detect the spam address, calculate address quality scores, correct erroneous city codes and suggest correct addresses to clients when completing details.
Product size recommendations:
In categories like clothing and shoes, brands track different size conversions, which customers may not always find favorable. Machine learning helps eliminate the problem by recommending product sizes that would best fit the customer.
Suggestions are made after a careful analysis of past purchases (including feedback data for the product was too small or too large) and customer browsing history.
Catalog quality
Product catalogue problems such as poor-quality images, colors, or descriptions can negatively affect the buying experience.
Ecommerce Web Development can take advantage of artificial intelligence algorithms to analyses thousands of product lists and links between catalogue elements to identify missing information such as brand name or colour on other products.
Another important factor is the freshness and extent of the collections and drawings. What would be the incentive for a client to come back to your portal?
Refund and Returns
Late return or reimbursement is a common complaint among eCommerce customers. Online retailers can use algorithms to detect the right purchasing behaviors and process faster returns by categorizing customers. By analyzing a customer's past buying behavior, they can identify between those who are actually returning the mailing and fraud attempts. The technology can provide a glimpse of customers providing absurd reasons for placing their returns.
This information helps e-commerce companies save time by calling clients who are really upset about delivery.
Summing up
The future of Eommerce website development in Indiabelongs to those that deliver a transparent customer experience. Currently, price is the major differentiator for online retailers. To grow and succeed, brands must identify a differentiation of products or services that they can only achieve.