When we talk about the India growth story, one cannot forget E-Commerce. Attend any startup event – especially in 2011 and you’ll find quite a few entrepreneurs or enthusiasts working upon a so-called niche E-Commerce product for India.

We all know that not many of the old companies of the late nineties survived in the 21st century. I saw a similar Ecommerce craze in around 4-5 years back as well. While online buying has seen a huge surge, thanks to better internet penetration, ease of use and more trusted providers in the game, the prime question everyone is asking about is – Are we really ready for Ecommerce now? What do the numbers say? For most corporations and investors alike, especially in internet space, a 3 to 5 year break even point is either not viable or acceptable.

To add my two cents to the debate – I’d say people in India shop online for 3 primary reasons in the following order – bargain deals, better range of products and ease of use. Snapdeal and a lot of other deal ventures are doing a great job sourcing the right deals to the consumers. Whether the companies themselves are making money is another point of discussion – but the consumer surely gets an incentive to buy online / offline.

With open source technology options around, starting up an E-Commerce venture has become relatively easy – especially from technology perspective. That makes trying out ideas a little easier as well. And I think that has led to quite a few entrepreneurs jump on the bandwagon  –  just to realize that starting a website and running a business are two different things.

E-Commerce is highly capital intensive and risky, especially in India. Logistics and supply chain, payments, taxation and law operations in India are quite different than in the other countries. The prime thing is an E-Commerce business requires is consumer ‘TRUST’ – and with so many variables in the business, one surely needs a lot of commitment and dedication to build his own successful model.

Entrepreneurs with experience in the US and UK might need to unlearn a lot of things before they can successfully venture into India. That being said, having a niche category is very important. With limited funds at disposal, it is very important that one concentrates on a particular category and get foothold in that before trying out other ones. Trying to supply everything to everyone is a sure shot way to failure – yes, this does not apply to Amazon or eBay but to most of us.

All said and done, a lot of things have changed over the past decade. While changes in eCommerce scenario can be a book in itself, let me mention a few points:

• Internet speed and availability has greatly improved
• Yes, the number of internet and E-Commerce users have increased phenomenally as well
• People are now comfortable making payments online
• Logistics have fairly improved – though there’s a lot of room for more improvement
• The disposable incomes of middle class people – especially in Tier 2 and Tier 3 cities have improved. People in these cities do not have access to all branded products and that’s what is making them buy online
• The technology has also improved over years. There’s a lot of research already available on user experience, payment handling and more – easily available to entrepreneurs
• Integration of mobile devices to the pure play platform

For entrepreneurs, there was never a right time to plunge into an E-Commerce venture than NOW – however, as a word simple advice, make sure you are adequately capitalized, have a specific lesser crowded niche to venture into and have a right team with you !

After all, even if you make a 100 million $ turnover, the prime question applicable to all businesses still remains – Is your E-Commerce venture really making money?

With all the ideas, thoughts and suggestions going around increasing conversions, concentrating on repeat customers, shopping cart abandonment etc, we tend to forget that for most small and mid-sized eCommerce businesses, majority of its audience is just window shopping. I have personally worked with quite a few eCommerce portals whose more than 60% of the visitors are just window shopping.  These shops had already put around a lot of effort in so called site design, product modeling and appealing features.

How do we identify window shoppers? Bounce rate? No, that’s not right. We simply measure window shoppers by measuring the number of people spending at least 30 seconds our products pages (including the home page) and not buying. Whether these customers are just spending their time or comparing your products with other sites or may be just trying to get more info on products – these people are important. You have them on your store front – yea they are not ready to buy yet, but you do have a chance to ‘ENGAGE’ them. The idea here is to build a bond with them so that when they are ready to buy, you are the first website which comes to their mind.

If we just go back and recall, we all would have come across websites which we might have visited, found to be good and forgot about it the next hour. We would also have come across websites which we would have visited, somewhere we’d have entered our email id or some contact and we still get an update from that website regularly. Those websites would already be in our mind somewhere and when in need we might also have bought products from them. What more, the website owner may also be connected with you on twitter and Facebook. Does this make sense? If yes, the only thing the second website guys did was to ‘ENGAGE’ with the audience time and again. In India there is a line in Hindi which is very popular – “Jo dikhta hai wo bikta hai”. As a business person, one must never loose a chance to communicate, relate and ENGAGE with his audience.

As per an article in practical eCommerce – After monitoring the shopping behavior of 163 million consumers completing 2.52 million transactions, McAfee SECURE discovered that the average customer waited 33 hours and 54 minutes, or nearly two days, between first visiting a retail site and making a purchase. In 64 percent of the cases, the shopper waited at least one day to buy.
The reasons mentioned by McAfee and practical eCommerce guys are all valid and well agreed upon. However, the point I am trying to make is, how do we ‘ENGAGE’ the customers who delayed their shopping decisions for whatsoever reasons?

Few ways in which we can ‘ENGAGE’ our customers can be:

Use Newsletter effectively – I’ve come across thousands of websites who have a well build newsletter system.  However, I also find that such systems are implemented for the sake of implementation – never optimized or mostly never used. There are huge lists of online and offline customers on hand but the newsletter systems don’t make an effective use of them. Some of them use the system so much that the people in the list are continuously bombarded by ill-formatted information from the website to the extent that they put the vendor in their spam list.

Some questions to ask yourself for your newsletter are:

• Is the placement of ‘newsletter box’ optimized for collection of customer data?
• Are all your customers getting added to your newsletter system? – A very basic question but many a times we find the answer to be negative.
• Are your offline customers added to your email marketing list?
• Is your newsletter design professional as well as precise?
• How often do you send out newsletters?
• Do you have a way to monitor the performance of your email marketing campaign? How do you optimize it?

Add /  Share buttons – Most of the eCommerce sites I come across have a ‘Share’ button to share products on various social bookmarking sites. If not, may be that the starting point. But if you already have a way for your visitors to share things on other networks, here are some questions worth asking yourself:

• Placement of Add / Share buttons – Amazon places the ‘Share’ button on the bottom right corner. I am sure they would have done their due research before placing them there. However, for all small and mid-sized eCommerce vendors, I’d suggest to place the Add/Share buttons where customers are most likely to click. How do we find that? That’s what A/B testing is for

• The best thing about Add this / Share buttons is they provide you with statistics on which websites are your customers sharing your products on. It is not only important to know this but to utilize this information in the best possible way and make sharing on these websites easier

• Do I need to mention, not only your products but also your blogs should be easily shareable ?
• Blog – Have one, update it and use it to interact with your audience
• Am eCommerce website is a business entity without a real face. People just see a storefront with products, may be some opinions and reviews.
• Give a face to your site by writing a blog. Have a detailed page about yourself – share some experiences and communicate with your audience. Let your audience feel related / connected with you. Possibly, have them share experiences as well.
• This works? I bet, it does. When you interact with your audience, people start connecting with you. And needless to say, more the engagement, more the fun and more the sales
• A sincere advise – make sure that the blog is updated regularly. If you do not have time, make sure someone updates it for you.

Social Media – Is it all hype or does it make some sense?

• While marketers are trying to come up with all sorts of fancy ways to measure ROI from social media, for a small business it just means more engagement
• Answer few simple questions for yourself – do you want to listen if a customer has got a suggestion / complaint?, Do you want to know what your customer feels about your products?, Do you want to ‘CONNECT’ with your customer? , Do you think your customer might buy a pair of shoes from you if he has bought a suit? – Do you want a group of people who’ll listen when you want to offer / talk? – If answer to any of the questions if yes, social media is for you. How much time / money you want to invest in social media is absolutely up to you – For SME’s I’d say social media is the best way to ‘ENGAGE’ your audience. Do it right and you have a way to success – do it wrong and you’ll regret trying it.
• Which networks to use for social media – again depends on your audience, your investment in time / money etc.

Ownership –

A visitor is more likely to remember your site if he gets related to the site in some way. Does it mean that he becomes a customer? No. What I mean is if the visitor participates in some sort of poll, contest or may be a small freebie on your website – he’d feel better related to the website. May be saying that – “Become a member of our free shipping community today and get free shipping on your products on your next purchase” may do the trick.

All in all…ENGAGE, ENGAGE, ENGAGE and the results will be phenomenal. One more suggestion – Have a well drafted strategy…..

Few years back I used to wonder why can’t I pay via my mobile phone. GPRS was unheard of then and owning a mobile phone in itself was a luxury.

The mobile payments space is getting exciting and interesting. With major finance companies and banks all investing huge sums in mobile payments, I am sure in a small period of time, we’ll all be using our smart phones to make payments. Who knows owning credit/ debit cards might become a history- something similar to what happened to our beloved ‘pagers’ after introduction of mobile phones.

Apple iPhone users will soon be able to make their payments through their device in front of the contactless payment terminal. A protective iPhone case developed by DevideFidelity will allow iPhone users to make payments in restaurants, retail stores etc via Visa’s contactless payment application, dubbed Visa payWave.

Micro Payment Terminal

Ofcouse a small chip in the iPhone case will do all the wonders. Market trials of the payment-enabled iPhone are expected to start this summer. The technology will work for both iPhone 3GS and iPhone 3G. Smart phones with a slot for memory card will also be able to use the technology b y inserting the chip into their memory card slot.

The mobile payment application can be password protected and utilizes advanced security technology to uniquely identify each contactless transaction. Visa is trying out the new technology in the US, after an initial trial in Japan and Malaysia. I am not sure of the success achieved in these two countries but am sure results would be encouraging enough to roll this out on a larger scale.

Third party vendors and several startups have already been active in this space – mostly covering utility bill payments and micro payments via mobile. Introduction of these contactless terminals would seriously create a revolution in the way we transact.

I wonder slowly they’ll start allowing me to pay via key chains, may be my shoes? Ahh……too many thoughts 

Example: Barbara is looking to buy a new dress for herself to wear on her son’s birthday party. She logs on to Amazon  and selects a dress of her choice. She also selects a pair of shoes, and jewelry to wear with the dress. Barbara, adds all the items to her wish list. She then logs in to looklet which say has tied up with Amazon.

Image source: http://www.2ne2.mn

She logs in and tries to find look for her friends on Facebook who can give opinions on her wishlist. She finds her two good friends Maria and Sally online on Facebook. Barbara asks both of them for their honest opinion on what she is intending to purchase. Which both her friends like what Barbara is intending to purchase, Maria things the Jewelry is not going well with the dress Barbara has purchased. Both of them, help Barbara find the right Jewelry for the dress. Barbara now saves her choice and sends it to some fashion designer for her expert opinion. The fashion designer gives her ideas and helps her make a purchase.

While the above case may not be a reality as of now, it will surely be in a few months or say years to come. The term ‘Social Shopping’ is being used more and more. Bits and pieces of these examples are already put in place by online retailers. We’ll move towards social shopping slowly and steadily and it may not be wrong to say that most of the shopping decisions would be based on social recommendations and interactions in years to come.

I am already seeing a few blogs on list of social shopping websites. While the concept is clear, we are not yet there with the implementation. Kaboodle, Woot, Shopstyle, productwiki….The list goes on.

In my coming blogs, I will put up specific opportunities which retailers can grab to shape up their eCommerce websites for the social networking landscape.

Honda came up with an interesting Ad campaign targeting young audience with a brand statement of innovation. The Ads were set up on Huge billboards in Dublin’s Wexford street, Ireland at a popular venue for young adults.

The campaign was tag lined “Wake the Beast” and invited passers-by to text START to short code 51500. The call to action signalled the lights on the car to light up and smoke from the exhaust on the poster.

The person who sent the text message received a link to the Honda’s mobile site more details about the car on his mobile. Using bluetooth technology, the person was also asked to participate in an opinion poll and was also made a part of a permission based marketing campaign.

Now that’s what I call an interest and innovative way to engage your target audience !

Wondering whether an online marketing campaign support this offline initiative or not.