There's a reason online shopping is popular in India. There's something about looking at hundreds of products in at least three different colours before buying them—or abandoning them in a cart—that appeals to Indian shoppers much more than shopping in plush air-conditioned stores with trial rooms and eager salespeople.
It is for this reason that big retail brands in India have realised the importance of having an online presence, not just in the form of catalogues but as full-fledged working models. The entire lifecycle of online retailing—from anticipating user intent to buy through their website to shipping an order—is being carried out by brands on their own. Of course, with the help of a slew of technology startups that are building online stores for them.
For big retail brands, a strong online presence is not just about having another channel of commerce. It goes beyond that. By launching digital stores, brands are directly competing with other as well as with online marketplaces such as Flipkart and Amazon that also sell their products.
"Two-thirds of our customers are digitally influenced in some way or the other and, hence, it is imperative for us to ensure a strong digital footing," said Maneesh Mittal, head of ecommerce at Tata Group's Infiniti Retail, which owns the Croma chain of consumer electronics stores.
Building an online website and connecting it to their inventory is just the tip of the iceberg for brands getting into ecommerce. The real challenge for them is to drive traffic to their websites, hook users to their products and provide the kind of experience that will make the user transact from their website instead of switching to an online marketplace app on their phones.
"The top questions brands want their ecommerce portals to answer are: Who is my customer, how to bring back the customer for repeat transactions, and what are the reasons for drop-offs," said Aneesh Reddy, chief executive at Capillary Technologies, a software and analytics provider that counts apparel brands Biba, Max, Fab India and Pantaloons among clients.
Capillary helps retailers answer those questions and build solutions around reducing friction during online purchases and driving traffic to their websites, said Reddy. It helps brand figure who is buying and what kind of campaigns work.
Understanding a customer's intent and behaviour is an important aspect of the ecommerce industry.
Just as in offline retail a salesman tries to understand a customer's intent, preferences and budget to decide what products to show him or her, in ecommerce, stores use analytics to read customer traits and modify product selection accordingly.
In online retail, it's important to remember that customers have a lot of options, said Atul Jalan, chief executive of analytics firm Manthan Systems. For example, a Biba brand kurta that you see on Myntra's app is also likely to be available on Flipkart or Snapdeal, not to forget Biba's own ecommerce website. Analytics like the kind Manthan specializes in allow retail brands to tweak their offers on the fly. So when a shopper searches for a kurta on a brand website the system ensures that the intent of purchase is converted into a real purchase, said Jalan.
Bengaluru-based Decisive Analytical Systems, which counts Walmart India as a client, uses its patented product called Plumb5 to read customer profiles, categorizing these into 94 parameters to make bespoke recommendations.
Analysis of a customer's profile includes intuitive details, said Arun Krishnamoorthy, head of partner network at Decisive Analytical Systems. For example, a customer from Dubai might be interested in a product with a 10% discount whereas a Bengaluru user could be more inclined to buy if the same discount is listed in actual value, say, a discount of Rs 300.
Apart from analytics, technology solutions provided by the likes of Capillary also give brands an edge by allowing them to be present across various sales channels— physical outlets to digital stores—increasing the potential for completing a sale. "Indian brands are now targeting close to 10% sales from their online channel," said Reddy of Capillary.
Apparel brand Biba, which went online in 2014, generates 35-40% of its total online sales from its own website. From its recent omni-channel initiative—which allows customers to select items from a store and get these delivered at home or buy online and collect from a store—Biba has been generating revenue of 3-4% of its total sales, said Biba managing director Siddharth Bindra.
Future Group-owned Big Bazaar is also slated to launch an online store this year, as a part of the brand's omni-channel strategy. Manthan is one of its technology providers.
How brands portray their online stores among various other channels that also sell their products is an interesting equation.
"We think of online marketplaces as being similar to malls with our brand stores," said Mittal of Croma. "Croma.com, on the other hand, serves as the equivalent of a flagship store, serving to provide a richer, more engaged experience for the electronics shopper.".
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