The Indian e-commerce sector is expected to touch $98.4 billion by 2023, with consumers putting their faith in online purchases and trying out various approaches that e-retail marketplaces are adopting. Over the past two years, COVID-19 has cast a worldwide shadow and its impact is no different on India. Its effect on e-commerce has led to a boom in the sector.
The lockdowns and restrictions implemented over the last two years played a key role in the massive e-commerce boom we all witnessed. While e-commerce as an industry grew by leaps and bounds, a few sectors like grocery, nutrition, and pharma proved to be forerunners, with furniture, stationery, and sports equipment being close followers.
Today people read up about a product online before making a purchase decision. E-commerce players have discovered that a consolidated ecosystem that integrates and optimizes offline and online inventory is beneficial in the present scenario. Establishing such a consolidated ecosystem has helped brands create a seamless multi-channel approach to sales.
Whether the customer is shopping online from a mobile device, a laptop, or by visiting a brick-and-mortar store, omnichannel commerce makes it possible for retailers to provide an integrated customer experience. Offering ease, choice, and convenience, omnichannel has been able to answer the question every retailer asks – what do customers expect?
From Fast to Superfast
Besides offering ease, choice, and convenience, online retail in India has taken product fulfillment to the next level by focussing on speedy deliveries with the introduction of ‘quick’ or ‘Q-commerce.’ Hyperlocal delivery brands in the grocery sector have changed the dynamics of the game, making product delivery possible within hours or even minutes. Food delivery brands are now entering the industry with massive investments in emerging ventures that have grabbed customer attention.
The ease of speedy deliveries has managed to attract a significant segment of buyers who don’t mind paying extra for the convenience. Riding a growth story on the busy lifestyles of city dwellers, Q-commerce is finding its strength and dependence on local businesses and stores. Popular concepts like ‘on-demand delivery’ and ‘e-grocery,’ have become favorite options riding on a focussed set of about 2,000 high-demand items, which are supplied through strategically located fulfillment centers called ‘dark stores’ within just 25-30 minutes of an order. Expectations from the sector projects it to grow 10-15 times in the next five years to become a $5 billion market by 2025.
Defining Success, the Digital Way
Besides adding speed to delivery, brands have been successfully exploring how they would sell their products and services directly to consumers. Eliminating middlemen and using the D2C model, digital-first brands have made rapid strides to gain prominence. With D2C being the strongest tool at their disposal, brands are using data-driven communication in their advertising campaigns and engaging with the right audience.
The use of these tools further ensures that audience attention is retained via retargeting their customer base through email marketing, push notifications, and detailed feedback mechanisms. Digital launches, sampling activities, and facilities like live chats are all boons of the D2C model, which has helped e-commerce growth in the country. Brands are also in a better position to understand customer needs and channelize product delivery accordingly.
Through its single-channel platform offering to brands, D2C has enabled network-wide visibility, supply chain planning, and execution, besides integrating logistics management and warehousing. Using the potential of the digital world, brands have been able to identify effective digital marketing tools, and are setting up their virtual marketplaces to enhance and maintain a direct connection with their potential customers. For customers, D2C has ensured improved satisfaction as demand-supply matching is optimal, and market spending ensures that product marketing and order deliveries are never piecemeal.
E-commerce brands, all around the world, have understood the importance of leading with social influence. With the penetration of the internet leading to a larger presence of consumers on social media, brands have begun to see this as a way of directly reaching a wider audience via social media. The use of social media influencers has helped brands reach a wider audience today through their established popular networks. A common source of generating revenue for these influencers – brand collaborations/endorsements are also a great way of increasing visibility for brands. Given how social media platforms are exploring more ways to help influencers advertise their brands better, India is ready to see a boom in products and services marketing done by influencers.
The rise in brand popularity has been linked to influencer marketing and the phenomenon of Internet celebrities being used to promote their products. Reports indicate that the Rs 900 crore market would grow 25 percent annually to become an Rs. 2,000 crore industry by 2025. The popularity of influencer marketing is such that it makes up for a larger part of marketing spend than celebrity marketing.
The use of social media influence has earned its place as a key marketing channel for e-commerce brands that are earning higher returns on investment. The rate of influencer engagement on the audience has gone up and strategic targeting of online audiences is possible. People have been convinced to try a new brand for the first time and become returning customers. With e-commerce brands having discovered that influencers are perfectly positioned to create brand awareness and sales amongst new online audiences for them, the focus is on integrating influencer partnerships into larger marketing initiatives that will boost the e-commerce growth story.
As e-commerce in India accelerates on a superhighway to growth, players will continue to defy limitations laid down as part of their expansion plans. With segments like e-pharma, which is moving ahead to include food, nutrition, and grocery or collaborations in the health-tech space, all forming trends that are today defining the story of e-commerce in India.