With the surge of online shopping in India, the Ministry of Consumer Affairs has recently proposed amendments to the Consumer Protection (E-commerce) Rules, which aim to implement more stringent policies on e-commerce retailers and prevent unfair trade practices. Despite these policy changes, India’s e-commerce sector is poised for high growth.
According to the recent analysis by Deloitte India and the Retail Association of India, the sector is estimated to reach $84 billion in total sales and 350 million online shoppers by the year 2025.
Due to movement restrictions to control the Coronavirus outbreak, Indian consumers have relied on mobile apps to do their shopping. But while e-commerce apps have made considerable gains during the pandemic, it hasn’t necessarily been driven by massive increases in installs. In fact, Adjust’s Mobile App Trends Report 2021 found that e-commerce installs only increased by 6 percent in 2020.
The big story was time spent in-app, which grew by 44 percent, showing that users became more engaged with the e-commerce brands they already love. This means apps hoping to win and retain new users in the upcoming online sales events like Flipkart Big Billion Sale must think strategically.
Here are a few tips that can help brands increase their user engagement and maximize the unique opportunities available for m-commerce during these events:
Do Not be Afraid to Spend - Brands should be willing to spend to acquire new users. According to Adjust’s data, the paid versus organic install ratio for e-commerce apps is high - 0.85 paid installs for every organic - versus an industry average of 0.45. Moreover, new users in this vertical tend to have good lifetime value (LTV) - and are backed by solid retention rates (13 percent on day 7 and 8 percent even on day 30).
Consider New Partnerships - No matter how great the app is, brands need the help of partners to find new audiences and drive installs. Adjust's data show the median number of partners per-app hovering at around five for all verticals - increasing to six in Q4 of 2020. But e-commerce apps lag behind most other verticals, working with just four partners on average. This presents a huge opportunity to increase and diversify the number of partners they work with to find their next pocket of potential and new users.
Reaching out to new users through a previously untapped network is good advice no matter what time of year it is, but there is no better time to experiment with new partners than during the Flipkart Billion Sale event. This serves as an opportunity for brands to branch out, give new partners a try, and discover a treasure trove of new users.
Put Retargeting to the Test - New user acquisition (UA) is essential, but as app marketers are increasingly aware, retention and engagement are equally critical to making the most of the company's UA budget for each new user. Brands need to ensure that they engage and interact with their current users, and spend as much time getting their attention on online sales days as they do when bringing in new shoppers.
While customer churn is inevitable, e-commerce also performs very well in reattributions. Data from Adjust shows that the reattribution rate (number of reattributions for every install) was 0.072 in Q4 2020 but was as high as 1.22 for e-commerce in the third quarter of the year - which presents another excellent opportunity for e-commerce apps. Pulling churned users back into the fold through retargeting timed with the most important shopping days of the year could prove to be a winning strategy.
Thinking Beyond the Sale
Consumers anticipate mega online shopping events every year and brands should not miss out on these opportunities to grow their e-commerce app user base. Shoppers plan and prepare for high ticket purchases and are likely to try new brands.
App marketers are wise, then, to think beyond the sales day(s) and define strategies to keep newly acquired users for the long haul. A retention and engagement strategy should be in place to turn deal-seeking customers into loyal shoppers all year round.
In a spirited discussion on AI and the retail industry, Puneet Chandok, President of Microsoft India and South Asia delved deeply into India's role in transforming the world through Artificial Intelligence and technology enablement. He discussed Microsoft's commitment to India, not only in training Indian talent but also in leveraging it.
On Monday, Prime Minister Narendra Modi had praised the Tech Entrepreneurs Association of Mumbai (TEAM) for hosting Mumbai Tech Week and their ongoing involvement in building tech startups in the country. During a panel discussion with Haptik CEO Aakrit Vaish at Mumbai Tech Week, Puneet Chandok, President of Microsoft India and South Asia, emphasized the transformative impact AI could have on various aspects of daily life.
Chandok stated, “When we look at India through the lens of demand, supply, and impact, there is no other market like India today. There are 7,000 listed companies in India and one hundred thousand startups. Many startups are in Maharashtra, and one hundred new startups are emerging in India every day. India is the largest SMB market globally, making it one of the most exciting markets today.”
He further added, “When we look at the supply lens and examine Microsoft's data, one out of four projects on AI in GitHub today is run out of India. Every sixth AI researcher in the world is from India. In the next ten years, 25 percent of the global workforce will come from India, meaning every fourth worker in the world will be from India.”
Discussing the growing influence and power of Artificial Intelligence, Chandok mentioned, “Last night, my 12-year-old daughter was creating text-to-video, and she told me that AI will change her life. She is an artist; she draws and paints. This also indicates how the younger generation perceives AI.”
Expanding on this, Chandok continued, “People will stop searching and instead have conversations. I have stopped searching myself; in fact, I was conversing with my Copilot to understand what is happening at the event and what I should speak about. We have shifted from searching to genuine conversations. This is not just chat drama anymore. These are sophisticated engines providing reasoning within.”
Regarding his personal perspective, Chandok remarked, “People say AI is overhyped, but I think it's not hyped enough. The next generation, which will use this in the next few years, will have much higher expectations of what technology can do for them. So, how you build it for that generation, how you build it for that future, will be really interesting to see."
Chandok also emphasized that those who do not embrace AI, risk falling behind in the rapidly evolving technological landscape. He encouraged Indian developers to seize the "lifetime opportunity" to become unstoppable by learning to use and deploy AI effectively.
He concluded, “If you are not learning AI, you are falling behind. I myself spend 30 minutes a day to learn more about AI. Technology is changing every day, and it has been 15 months since ChatGPT was launched. The speed of technology diffusion is unlike anything I have seen in my life, and it is advancing very rapidly. My call to action for everyone is to find a way to learn, otherwise, we will all fall behind.”
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