admin
February 18, 2015
Varun
Jain, The Economic Times
New
Delhi, 18 February 2015
E-tailers
in India are coming up with products and offerings exclusively
for senior citizens, turning their attention to a category of
consumers that they had hitherto ignored in their rush to reach
the growing young population in the country.
Mumbai-based Rahul Upadhyay, whose Seniorshelf.com caters exclusively to senior citizens with mobility aids, toilet safety products and items meant for arthritis patients, said the venture was inspired by a personal experience when he went to visit his parents and then spent three hours looking for a blood pressure machine.
"It was just not available. That is when I realised that there is virtually no retail – online or offline – which is catering to the elderly while they are the most vulnerable ones. Despite having the means, senior citizens in India are mostly left to fend for themselves and in many ways the market has ignored them as a consuming class with needs of their own," said Upadhyay, who was encouraged by the growth of e-commerce business in the country to take the plunge.
A similar situation faced by the promoters of oldisgoldstore.com led to the opening of this south India-based online and offline company, which sells health care products exclusively for the senior citizens.
"There are over 120 million people over the age of 60 in India. That is more than the entire population of most of the countries in the world. With improved health care, more people are living longer and this is increasing the need for home health care as well. This means that there is a significant growing market for e-commerce players in this sector," said Sanjay Dattari, one of the three promoters of oldisgoldstore.com.
New Delhi-based Healthgenie.in, which started about two years ago and is in talks to raise $1 million (about Rs 6.2 crore) in funding, has a category especially for elderly health care. According to Manu Grover, founder of Healthgenie.in, whose family has been into manufacturing of medical devices for 50 years, the health care requirement of a person over the age of 60 years increases drastically.
"Combine this with better life expectancy and we can see the market size increasing and gaining a substantial foothold in the coming five years. But still there are not many e-commerce players in this domain who cater to the elderly," said Grover.
The lack of easy availability offline of the products required by senior citizens also provides a ready opportunity to such ventures. As per Upadhyay’s estimates, the e-commerce market for the elderly is barely 5% of the overall market that is estimated at Rs 10,000 crore.
"Hence there is a huge potential to leverage this gap and enable elderly access products and services regardless of which part of the country they live in," said Upadhyay.
According to Devangshu Dutta, CEO of retail consultancy firm Third Eyesight, products that are targeted at seniors will also be those that are not easily available through other channels, and therefore discounting pressures on the seller are less and the business can make healthier margins. "Provided consistent products, sensible pricing and excellent service, the consumer’s stickiness with the retailer would also be higher," said Dutta.
These e-commerce players have tied up with various medical services companies which provide doctors, nursing physiotherapy, diagnostics and equipments at home, to provide a seamless experience for the elderly. One such company, Portea, whose large portion of customer base is the elderly population, is also associated with e-commerce players catering to senior citizens.
(Published in The Economic Times.)
admin
February 5, 2015
Varun
Jain, The Economic Times
New
Delhi, 5 February 2015
India’s North-Eastern states are fast emerging as the drivers of growth for some leading e-commerce companies, which claim double-digit growth in the market after having overcome last-mile delivery challenges.
In this region, where hilly terrain and limited road and flight connectivity have posed hurdles for companies wanting to expand operations, demand for goods online is being fuelled by unavailability of certain products and the deep discounts being offered by e-commerce companies on a host of goods, including branded products.
Snapdeal’s VP – operations, Ashish Chitravanshi, said the North-East region is not only an important market for the company but also has the potential to be at a par with Delhi and Mumbai, in terms of business potential.
“The region is among the fastest-growing markets in the country for us. We have been steadily growing in double digits monthon-month in the North-East markets, with a steady increase in the number of orders from the region,” said Chitravanshi. “As we take our reach deeper into the region we anticipate this number to grow phenomenally.”
While Snapdeal services large parts of the North-Eastern region covering more than 1,100 pin codes, its rival, Flipkart, serves customers in over 80 cities in the region in partnership with logistics players eKart and India Post.
Flipkart has seen healthy growth in the region in recent years and is now scaling up its supply chain capabilities and support facilities to create a seamless shopping experience for customers there, a company spokesperson said, adding that the region has a relatively younger customer base as compared to the rest of the country and categories like apparels, games, music and books are popular.
Similarly, as much as 15% of Fashionandyou’s revenue comes from the North-East, said Manav Narula, its GM for marketing.
Sanjay Sethi, CEO and co-founder of ShopClues.com, said that though the percentage contribution to gross merchandise value(GMV) is in single-digits, the company expects it to grow to 10-12% in the years ahead.
Devangshu Dutta, chief executive of retail consultancy Third Eyesight, said taht due to logistical constraints, managing a network of physical retail points is cumbersome in the North-East, while e-commerce is at a specific advantage in this region, since it allows a virtually unlimited range of product offering to be presented rapidly to the customer at a relatively low cost.
India’s largest fashion e-tailer Myntra established its distribution centre in Guwahati a year ago, followed by a centre in Mizoram’s capital Aizawl. “When we started the Aizawl centre, it showed us 500% jump in sales,” said Ganesh Subramanian, head of new initiatives at Myntra.
For Myntra, a year ago, the North-East region was growing at 1.5 times the overall growth of the company and the business coming from this market is currently in line with the company’s overall growth, Subramanian added.
But it is not just mass e-commerce players who are seeing traction from this region. Specialty and niche players are also in the game to conquer this still untapped region.
Gaurav Singh Kushwaha, founder and CEO, Bluestone.com, an ejewellery company, said the region contributes to about 11% of the company’s revenue. Also, the average selling price from the North-East is higher than the average selling price from other non-metros, he said.
FirstCry.com, a retailer of children’s products that has four service centres in the region, of which the ones in Agartala and Guwhati are owned by the company, plans to add another two distribution centres in Silchar and Shillong in a few months, said founder and CEO, Supam Maheshwari.
The region’s difficult terrain has thwarted efforts to build roads and improve airline connectivity. This, in turn, has hindered growth of offline retail and availability of branded products. “It is the ideal use case for e-commerce where customers are not buying because of discount but because of lack of availability of options and variety” said Kushwaha of BlueStone.
Some e-commerce players see this region as a game changer if the logistical challenges are addressed.
Chitravanshi of Snapdeal explains, “The region forms 8% of India’s landmass and has only 4% of country’s population, which means the population is thinly spread across a largely mountainous area. This certainly presents a logistical challenge in terms of connectivity and cost involved to all e-commerce players.”
Vipul Sharma, director of ecommerce Association of India, feels that the development of IT infrastructure at a faster pace can really turn the tide for the region
(Published in The Economic Times.)
admin
February 4, 2015
Anand
Murali & Jayadevan PK, The Economic Times
Bengaluru,
4 February 2015
Xiaomi
will likely set up a marketplace platform and bring on board third-party
retailers to sell the phones on its portal Mi.com
When Chinese phone maker Xiaomi starts its own portal to sell phones in India, it may adopt the model followed by Amazon and Flipkart to work around the country’s retailing regulations.
Xiaomi will likely set up a marketplace platform and bring on board third-party retailers to sell the phones on its portal Mi.com. Xiaomi will supply the sellers so that it doesn’t flout retailing norms, according to sources. By creating a marketplace-like structure, it will avoid regulatory issues around retail foreign direct investment, said a person aware of Xiaomi’s plans in India.
"Technically, they can’t set up a business-to-consumer ecommerce site in India because that’s not allowed," said Devangshu Dutta, chief executive officer of retail consulting firm Third Eyesight.
Xiaomi, one of China’s largest smartphone vendors, has been selling devices in India by holding flash sales on e-tailer Flipkart and through AirtelBSE -1.08 % stores. The company is yet to finalise its own online plans.
"We’ve been seeking expert advice on how to structure it. We won’t do anything which is against the spirit of the law," said Manu Jain, head of Xiaomi India.
Creating a marketplace-like structure and working with third-party retailers is one of the options but the company hasn’t finalised anything, said Jain, who was one of the founders of e-commerce portal Jabong and joined Xiaomi in June last year.
The sales strategy centred on its e-commerce portal will also help offline sales as merchants from smaller towns can buy Xiaomi phones online and sell them in their stores.
Foreign direct investment is not allowed in online retailing, unless the company provides a platform to sellers. Amazon and Flipkart have Indian partners that sell a majority of the goods on the marketplace. The norms apply to Flipkart because it has received FDI in the form of venture capital and is domiciled in Singapore.
Prione Business Service, a 49:51 joint venture between Amazon and Catamaran Ventures, is one of the largest sellers on the platform. Most sales on Flipkart are through WS Retail, a company hived off by Flipkart to comply with Indian regulations on retail.
Xiaomi will continue to sell on Flipkart even after it launches
its own portal, said Jain.
(Published in The Economic Times.)
admin
February 3, 2015
Sharleen
D’souza, Business Standard
Mumbai,
3 February 2015
In search of the next sales pitch, some of Madura Fashion and Lifestyle’s (part of Aditya Birla Nuvo) apparel brands are turning to customisation. The first to let consumers have a go at it was Madura’s Louis Philippe, but that was seven-eight years ago. Now, Van Heusen, its mid-to-premium formal clothing brand and its casual clothing brand extension, V Dot, are set to take it up on a mass level.
Ironically, the readymade apparel market flourished and overtook the unorganised tailoring segment when customers eschewed bespoke shirts and pants. And yet, one of the major readymade players is bringing some of the latter’s characteristics back.
Van Heusen is calling the move MY FIT, and it will run parallel with its regular readymade offerings. Van Heusen’s entire range will be customisable in the next one month, at its own stores. The consumer can change the collar style, sleeve length and add or take an inch or two for a better fit.
Van Heusen is betting on the fact that most of its competition, such as Park Avenue (Raymond), Zodiac and Blackberry, operating in the same price range, do not offer such customisation. However, it will go up against Raymond’s ‘Made to Measure’. Both will now have shirts priced upwards of Rs 2,000 (inclusive of Van Heusen’s extra charge of Rs 300 for customisation). In case of Louis Philippe, customised shirts begin at Rs 6,000.
Van Heusen will deliver the garment in seven to nine days, with plans to cut short the delivery time to five to six days. “We are looking at a deeper customer engagement with the brand. This is a complete change in our business model,” says Vinay Bhopatkar, chief operating officer of Van Heusen.
The jury of experts seems to be divided on the move. Some feel that customers walk into a branded readymade apparel store because they want to buy what is available and not spend their resources of time and money to add to that task. “Customers want a complete product when they walk in. They are not designers who would want to alter a product if they are not happy with it,” says Prashant Agarwal, joint-MD of retail consultant, Wazir Advisors.
Yet others say the hybrid model could be a way forward. “It is a fairly significant move for the brand. For a customer, buying readymade clothes is a question of trial and error. Not every product suits the body frame. The concept of the brand going back to the single piece is huge,” says Devangshu Dutta, chief executive at Third Eyesight, a retail consultancy firm.
Aditya Birla Nuvo, which has been shoring up its apparel business by not just adding to the count of its branded stores but also with acquisitions such as Pantaloons, has been trying to include a greater scope for customisation across its brands. Besides Louise Phillipe and Van Heusen, its casual clothing brand, Allen Solly, too, had introduced the option of choosing from a palette of 670 dyes for a custom colour, last year. These options can also drive footfall to the brands’ exclusive stores where these are available, rather than shop-in-shops or multi-brand outlets where trade margins are lower.
Van Heusen’s litmus test would be the extension of MY FIT to its women’s line in the next few months, as Bhopatkar informs. Launched in 2007 but scaled up since 2013, it contributes 10 per cent to revenues (in 2013-14, Van Heusen’s total sales stood at Rs 1,500 crore). Women’s readymade clothes are the largest ready-to-wear segment and Van Heusen claims its business is growing at 30-40 per cent.
The brand will dedicate 10 per cent of its in-house manufacturing capacity to customisation. The store staff,too, has been trained to guide customers.
The overall apparel market is around Rs 2.75 lakh crore of which branded apparel is around 25 per cent.
(Published in Business Standard.)
admin
January 29, 2015
Varun Jain, The Economic Times
New Delhi , 29 January 2015
As
online shopping grows in India, deal sites that offer cash-back
and discount coupons have emerged, helping retailers to add customers
and widen the market. E-commerce entities such as Amazon have
started to realise the importance of these deal sites and the
impact they can have on business.
For large e-commerce players, partnering with discount coupon
and cash- back sites is a way to gain a larger market share and
build competitive advantage, said Ravitej Yadalam, CEO and founder
of Pennyful.in, a coupon and cash-back shopping website. For smaller
companies, affiliate marketing, as the concept is known, is a
way to garner brand recognition and a risk-free and cost-effective
channel for customer acquisition and retention, according to Yadalam.
Anisha Singh, CEO and founder of mydala.com, a Delhi-based coupon provider, says it is a good time for the online discount marketing industry in India. According to her, "a report by Motilal Oswal has stated that the online coupon/discount marketing segment has flourished alongside the surge in e-commerce in both US and China."
There’s no unanimity about the impact of deal sites and some say that they benefit mainly small and relatively new retailers.
Couponing websites are most useful for those retailers and service providers who are new, local, or too small to compete with large e-tailers in driving traffic to their websites, said Devangshu Dutta, chief executive officer at Third Eyesight, a consulting firm.
"In many cases, the benefiting merchants may not have any online presence at all, and the couponing site provides them a relatively low-cost, low-commitment model to create a presence online," said Dutta.
Amazon, the world’s largest online retailer, has tested the concept – the company refers to affiliates as associates — in the global market and has a different take.
"Associates are a great platform that we have had for 20 years and we continue to invest in them. When it comes to India, it is going to be one of our very important channels," said Samir Kumar, director of category management for Amazon India, acknowledging that deal sites are an efficient way to get traffic to its platform.
Flipkart, the other major e-commerce player in India, declined to respond to e-mailed questions.
CouponDunia, a discount coupon site, pushes over Rs 20 crore worth of sales to merchants every month, according to founder and CEO Sameer Parwani. With a monthly visitor rate of 4 million and an e-mail subscription base of 3.7 million consumers, it directs a substantial rate of traffic to partner websites, says Parwani.
Mydala, which claims to have sales of 200,000 vouchers every day, enables revenue to the tune of Rs 400 crore per month for their partners, according to a company official.
Another deal site, CashKaro.com, manages over 2,500 transactions a day and has credited over Rs 4 crore of cash back to members, according to Swati Bhargava, a co-founder. It has enabled partners to generate Rs 150 crore since the company started in April 2013.
Given the boom in online shopping, turnover at deal sites has grown rapidly.
"Our overall business has been EBITDA (earnings before interest, taxes, depreciation, and amortisation) positive and has clocked in 600% growth in sales in the last two years…we are looking at increasing our merchant base to a million merchants in 2015 and coupons sales to increase to 8 million per month in March 2015," according to Singh of mydala.
Yadalam of Pennyful.in says the company’s revenue rose 2.5 times
year-on-year as of 2014 and its customer base is increasing by
150%.
(Published in The Economic Times)
