Online retailers rush to create applications, specialised tools to drive sales

23 Jan,2014

By Radhika P Nair


The ancient Chinese military strategist, Sun Tzu, said not being prepared is one of the greatest crimes a strategist can make — a folly that online retailers in India are keen to shun as the battle to win new clients gradually shifts to the mobile screen.

Sensing that most of the growth and revenues will come from mobile-only shoppers, these sites are rushing to create specialised tools, such as personalised deal generators and local-language apps, to capture this new and rapidly exploding customer base. Already, the evidence is overwhelming.

Customers shopping through mobile devices now make up for up to a third of sales at online retail sites, up from a measly 7% even a year ago. “So far mobile was only an extension of the web, but now we are doing a number of experiments to create a smoother and unique experience on mobile,” said Sachin Bansal, co-founder of online retail site Flipkart, which is targeting $1 billion (over Rs 6,000 crore) in sales next year. “In the near future, we see as an m-commerce-based marketplace.” Mobile users are now responsible for a fifth of Flipkart’s sales, and three out of four mobile shoppers access the site only through handheld devices.

The potential for attracting clients who were so far out of reach is another reason. “In my opinion, we can add 25% more to sales from mobile shoppers,” said Ankit Khanna, vice-president (product management) at Snapdeal.

Snapdeal’s Mr Khanna expects orders from mobile users to grow from 30% now to over half by next year. Most of these users have never accessed the site through a desktop. Snapdeal is also targeting revenues of $1 billion (over Rs 6,000 crore) next fiscal. Mobile-only shoppers are as valuable as desktop users, with average spends only marginally lower. At Snapdeal, the average order value of a mobile shopper is Rs 1,000 for apparel and up to Rs 3,500 for electronics, similar to that of desktop users.

Even global players have realised that the mobile could be key for winning Indian clients. “Amazon is investing (in India) in creating a world-class mobile platform,” said Amit Agarwal, vice-president and country manager of Amazon India, who declined to share exact numbers. “We (Amazon India) are the fastest growing m-commerce site for Amazon globally.”

Pragya Singh, vice-president at retail consultancy Technopak, said while growth has so far been without much effort, “companies will have to invest in unique user experience from discovery of the product right up to payments”.

Something that is already work-inprogress at most sites. While Flipkart has launched a tool that allows mobile users to scan a product’s barcode and check its availability — a feature also available on Amazon India — Indiatimes Shopping is set to launch special promotions for mobile-based customers. “Indiatimes Shopping is adopting a mobile first strategy and is building products and processes to suit the needs of the mobile generation,” said Saurabh Malik, business head at Indiatimes Shopping, which is a part of the Times Group.

Snapdeal, on the other hand, is attempting to personalise its mobile app according to a customer’s usage.

It is also developing an in-site search engine for mobile and is revamping its mobile backend. Flipkart is also working on a tool that will use a customer’s location to provide tailor-made deals. Rahul Chowdhri, a director at Helion Venture Partners, said ecommerce firms will have to redo whatever they did on desktop to cater to the mobile-based market. “Mobile is very personal; we carry it with us all the time. The mobile helps pinpoint location and even the spend potential of the customer.”

These firms attribute the spurt in mobile user numbers to customers from smaller cities and towns. “Here the mobile is the only screen, and in smaller cities and towns the mobile is already beating the desktop,” said Vivek Gaur, co-founder of web-only fashion portal Yepme, which aims to reach Rs 300 crore in sales next fiscal. Mobile shoppers accounted for more than a third of the company’s sales last quarter. Yepme is also working with Helion-backed startup LinguaNext to provide local language mobile apps. The firm will soon launch a Hindi version.



Source:The Economic Times

Copyright © 2014, Bennett, Coleman & Co. Ltd. All Rights Reserved

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