Online Shopping Trends in India

Consumer Behavior
Introduction
When I looked back at the items that I bought last year, there were quite a few of them which I bought after shopping online. I asked many of my friends and close relatives as well about the amount of items that they bought online versus from the store. And almost all of them responded that their online purchases have gone up drastically last year when compared to the previous years. This got me thinking as to what exactly is driving the customers in India to shop more online. Since then I have visited many of the online shopping portals and closely observed the techniques that are used by them to woo Indian customers. This also gave an insight as to what the customers are looking for while shopping online and what are the different behaviors that they exhibit while shopping online.

Insights
The evolution of the broadband internet in India has ushered in new avenues for manufacturers and has in turn paved the way for many of the websites on the block like Jabong, Flipkart, Myntra, Snapdeal and many more. Also consumers, irrespective of being in urban or rural India now have access to all the major brands because of this revolutionary change in online shopping. From electronic items to apparels, from accessories to kitchen and bathroom ware, home furnishings, baby products, travel deals to hotel stays, even groceries and vegetables you name it and everything is just a click away.

Online Shopping Trends in India

Google India along with TNS Australia recently conducted a study on the online shopping trends in India in 2012 and found that Electronics items fetched the top search but the most bought were apparels. They used the Google trends and the survey by TNS on a sample size of 800 respondents. As per the reports 2012 was the tipping point for online shopping in India as it saw a significant 128% growth in interest from the consumers in the year 2011 to 2012 in comparison to only 40% growth in 2010 to 2011. Following was the top category of products that were google searched online with Electronics (34%) topping the search followed by apparels and accessories (30%).

With the burgeoning proliferation of mobile both in rural and urban India especially with people increasingly shifting to smart phones, the online purchases that were done using mobile devices witnessed a 2X growth when compared to the previous year. Currently, 30% of all shopping queries in India come from mobile phones. And as per the research, 90% of the online shoppers are planning to buy more products online which reflect on the positive experience of the users. The factors that motivate consumers to shop online is the convenience of shopping, great deals and access to a huge collection of branded merchandise, cash back guarantee, pay cash on delivery, fast delivery, and access to branded products. Some of the barriers that prevent the customer from shopping online are inability to touch and try the goods before purchase, fear of faulty products, fear of posting their personal and financial details online and the inability to bargain.

Consumer Thought Process using case study

Consumers are looking for the same or in fact a better experience than what they get from a brick and mortar store but all that from the convenience of their home with a click away. The Web experience that each of these portal creates is a major factor that contributes to the success of the online store. The online experience is enhanced by presenting the virtual client with an Consumer Behavior Page 2

Online Shopping Trends in India

good functioning, easy to explore, fast, interactive Website. Functionality includes Usability and Interactivity elements. Functionality Factors. In a store a customer can easily find what they need if the products are categorized by type of products and brand. The online portals strive to deliver close to this real experience by displaying their products based on categories like Clothing, footwear, Beauty and Personal Care, Books, Electronics, etc. This way the consumer will not find difficulty in finding any merchandise. Unlike the brick and mortar store, the online store tries to sell all the brands under the sun. So categorizing and displaying these brands is very important.

For example when you enter a supermarket the store layout is designed in such a way that customer is driven from one category of products of different brands to the next category of products in a smooth flow which even the customer might not be sometime aware of. In the process the customer tends to buy more and more. They would in fact even buy many products which they wouldnt have thought of buying while entering the store. Online portals strive to deliver close to this real experience by displaying their products based on categorization like Clothing, footwear, Beauty and Personal Care, Books, Electronics, etc. They also allow to search by brand for the brand conscious customers. This way the consumer will not find difficulty in finding any merchandise. Unlike the brick and mortar store, the online store tries to sell all the brands under the sun. So categorizing and displaying these brands is very important both from the point of view of the seller and the customer. For example, the last time I searched for a casual shirt in www.jabong.com , I was presented with a huge collection of 1400 shirts. So how does a time-strapped customer who comes online to save some time pick up a shirt from this huge collection? Online stores provide filters like Sizes(S/L/XL), Price Range, Color, style (checks,strips,solid color,etc),Sleeve(half sleeve, full sleeve) to make the customers life easy. Same is the case for other products. Consumer Behavior Page 3

Online Shopping Trends in India

The online stores also allow customers to rate their products and hence categorize their products based on popularity. This in a sense helps the customers to gauge the quality and the latest trends of a product. This is also a feedback mechanism both to the seller and the visiting customers because many of the products are rated based on the value proposition they bring to the customers that have already bought it. This is a huge plus point that the online stores have when compared to real shopping experience at the brick and mortar stores. For example on www.flipkart.com there is a review mechanism for almost every product and reviews are categorized as one from a Certified buyer vs. a biased/fake review. The customers can also compare the features of the multiple products side by side and make a conscious decision. This is especially useful to the customer while purchasing electronic products like mobile phones, TV sets,etc. These are benefits that only the online stores have when compared to the brick and mortar stores. The customers are intelligently making use of these features that the online stores provide along with showrooming (a practice where customers examine the product at a retail store before buying it at a cheaper price online) and cross shopping ( comparing the prices of products across different online stores) and making the best possible conscious decision before buying a product. Thus the buyers decision process goes through the following stages Problem identification, search, trust building, evaluation of alternative, and choice, post-purchase behavior. One of the crucial things that customers badly miss online is the touch and feel before buying a product. The online stores are kind of solving this problem by providing a high resolution image of the product from different angles which can give you an impression of even the texture of the product like in case of apparels.

www.yebhi.com has also introduced the try and buy mechanism for the first time in India where the customers can order multiple products of different sizes, try them when they are delivered to your house and buy only the ones that really suites your taste/size. This is extremely useful because when you buy online many a times the product would be quite different from Consumer Behavior Page 4

Online Shopping Trends in India

what was seen online in terms of color, size, scale (especially for furnitures). Websites like www.Lenskart.com , www.jewelskart.com even provide the customers an option to even upload their own portrait photo and judge the best fit of lens frame or jewels. These methods still have some limitations but they are making a very good attempt to solve some of the customer problems while shoppingonline. Everyday is a deal day when it comes to online shopping stores like Crazy Sunday, Monday mania, Thank god its Friday offer, Summer sale, winter collection, end of season sales. Online stores are also wooing the customers by giving heavy discounts, buy one get one offers, discount coupons, etc. There are infact other websites like https://www.cuponation.in/ which aggregates deals and coupons from different online stores so that customers do not miss any deals. This in fact drives the customer to shop more and more and buy products which they wouldnt have intended to buy but would buy only because there is a deal on that product. Online shopping stores are also taking care of Pschycological factors by communicating integrity and credibility in order to persuade customers to stop, explore them and interact online. Psychological factors are those playing a crucial role in helping online customers unfamiliar with the vendor or unfamiliar with online transactions to overcome fears of fraud and doubts as to the trustworthiness of the Web site and vendor by offering reliable online payment solutions and prompt and safe delivery services. Almost all the online shopping stores also provide 30day buy back guarantee, free shipping, pay on delivery options to address the pain points while shopping online.

Survey
http://kwiksurveys.com/s.asp?sid=ekdye05p6n8ecrm152207#.UZFdNw6suHM.gmail

The survey that I conducted also brought up interesting insights into the consumer behaviours and preferences while shopping online. One disadvantage of the survey was the sample size that I could manage was very less (around 56). This is partly due to the huge number of surveys that my respondents are put through in various subjects and they are losing interest in responding even after repeated requests. Around 84% of the respondents said that they shopped may be once in a month online. 41% of them mentioned that they spend <5% of their monthly income shopping online. The most frequently shopped online were the tickets (movie,flights,etc) followed by Electronics, books and apparels. Websites were the highest source of information that lead to online shopping followed by email alerts and social media. Majority (66%) of the respondents were feeling much more comfortable using the credit/debits for their shopping and transacting online which is a good sign for the online shopping stores. As per the survey, majority (64%) of the respondents still prefer saving for and buying a product rather than going for EMIs. 69% of the respondents admitted that they resort to showrooming before buying a product. Mobile phones were not still used much by the majority to shop online. There are some more interesting data that can be mined out from the survey using SPSS which I would be doing when I get a license for SPSS. Consumer Behavior Page 5

Online Shopping Trends in India

The survey questionnaire and the responses are also attached along with this report

Bibliography
1) Chapter 9 Buying and Disposing , Consumer Behaviour Buying,having and being by Michael R Solomon 2) http://yourstory.in/2013/01/google-india-study-about-online-shopping/ 3) http://jcmc.indiana.edu/vol10/issue1/kim_larose.html

Consumer Behavior

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