E-Commerce in India : After an era of change

  • Lalitha Shukla
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  • Published Date : 22 April , 2021
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  • Updated Date : 11 May , 2021
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    • 4 min read

The pandemic, last year, brought about a wave of digital transformation in the country. Due to lack of choice or concerns about safety or just plain convenience, consumers started taking to digital ways to fulfill their needs. This change in behaviour boosted the growth of the e-commerce industry in India. The last few years had already witnessed a rapid growth in the segment due to increase in internet and smartphone penetration, but the pandemic accelerated that growth by 3x. Right from groceries to clothes to books to personal care products, every item was now being purchased online. The Indian e-commerce industry is expected to be a USD 200 billion market in the next 3-5 years.

An interesting thing to note here is that the consumer behaviour underwent massive changes at a very fundamental level. Most of them started adopting new ways of shopping online out of necessity first, but soon this changed into a habit due to the sheer convenience of sitting at home and having everything delivered to your doorstep. This caused a chain reaction to everything around - right from products, services, to brands and categories.

For marketers like us, consumers are the centre of our universe and therefore, it became imperative for us to dive a little deeper into their behaviour to understand how the growth of e-commerce changed their lives. In order to do this, we conducted a survey online and asked a series of questions to consumers to understand their shopping behaviour and patterns.

Our report on the E-commerce sector in India has a detailed account of the changing consumer behaviour pertaining to the e-commerce industry, key takeaways for brands and businesses in this space and some interesting insights. You may also find it interesting to read our recently published book, Decoding the Digital Jungle.

Key takeaways for brands & businesses in the e-commerce space -

1) The path to purchase is indefinite & complex -
The number of touchpoints in the digital environment for the consumers has increased, so has the number of avenues for a brand to be present at, innovate at and be interactive at. As per a recent Amazon report, consumers use 4 platforms on an average before making their decision. The report also says that more than half of the consumers visit Amazon with the purpose of research implying that the platform is not just a point of purchase/action area in the consumer journey. As per a study conducted by Google, the journey between Trigger and Purchase goes through a messy middle which consists of a process of exploration and evaluation. The loop can be broken only by a brand that is present at the right touch-points providing appropriate information to help evaluation quickly. An important marketing tool post-pandemic is to advertise on Amazon and Flipkart if the product and services are relevant. The advertising need not be limited to conversion objectives but it should be about driving consumers through the funnel. Brands also need to ensure that ad messaging is tailored to the needs of shoppers who are in the evaluation phase. As per a study conducted by Google, there are behavioral biases that influence our shopping decisions. We need to put out our messaging by aligning our biases and category aspects. For example, scarcity bias plays a role when it comes to the Lifestyle and Fashion/luxury/premium category. As stock decreases, the products become more desirable to purchase. Brands should also form tailored email marketing campaigns to aggressively engage with potential customers. Retargeting and basket abandonment message to engage with evaluative shoppers before they make a decision. Need of the hour is for brands to have a robust social media strategy and a full-funnel marketing plan to drive consumers to purchase. More Social Media platforms need to be explored and defined as per the target audience and objectives. This will assist consumers to evaluate and come out of the “messy middle” quickly.

2) Grocery Shopping : A clear winner!
When it came to understanding the key categories which were a boon to E-commerce, Grocery came out as a clear winner as per the survey results. Availability of items on grocery apps and websites is a major driver for a consumer to be loyal to that platform. Continuous non-availability can drive consumers to reconsider loyalty. Also, consumers have a strong affinity towards buying from local stores, familiar shops and brands they know about. The experience on the User Interface makes a lot of difference to a customer's preference. There are instances where consumers expressed that they distinguish Zomato and Swiggy based on their user interfaces. A simple, self-guiding and clutter-free UI can change the game.

3) Brands with a purpose -

The global pandemic has elevated the idea of a company's purpose or the idea of a meaningful business - how brands give back to the community and the environment. There were a few key attitude shifts during 2020. As per a research conducted by Google, 86 % of the respondents say that they have become more environment conscious due to the pandemic. Consumers have expanded their
horizons and hence, they are open to more choices, rather better choices. As it is rightly said, it takes one downfall to make you learn for life. As per our survey, 70% of the respondents said that they started using sustainable brands post pandemic. Giving a higher purpose to your brand is essential now as it is no more just a differentiating factor - consumers might place more importance on this
than on customization.

4) A shift towards Digital payments  -
As per a recent KPMG report, In October 2020, digital transactions jumped to 23.7 million amounting to around 4000 crores. Through our survey, we found out that 70% of the respondents preferred using digital payment methods while shopping online. People in India feel more secure while transacting with physical cash than paying digitally as per the prevalent consumer behaviour. The findings imply that there has been a phenomenal shift in consumer preferences. It is very evident that the consumers of today are experimenting and trying newer platforms for financial transactions. The brands in this sphere need to be very proactive in forming strategic partnerships with fintech platforms.

In conclusion, we’d like to say that today’s ecommerce brands cannot be complacent anymore. Consumers today are well-informed and smart and have very high expectations of brands. An E-commerce brand of today has many more touchpoints, many more potential consumers and a complicated consumer journey to look after. Let us get on with it and adapt better!




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aftab khan2021-04-28 < Reply

Hello sir, The key takeaway for me was the first one where you tell about the indefinite path even after a decade of the existence of e-commerce. I saw your post, I read your article, it is a very good article content. Great post I really liked it. I read a post like this somewhere else, he was also a good post. Thank you so much for sharing this post. Thanks

Sangam P2021-04-27 < Reply

The key takeaway for me was the first one where you tell about the indefinite path even after a decade of the existence of e-commerce. I work for Metromindz and we do have clients from e-commerce, So what is the best advice that you want to give them?Thanks for the answer in advance.

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