It is said that with every decade passing by, the modes of business change. The reason behind the same is the market demand and customer availability. The Indian retail segment is currently facing a huge problem due to the same reasons. The customer base is seen getting huge exposure online and multiple choices in one place. This has given the retail shops a tough fight for their existence ahead. The direct impact of the same has been noticed on the wholesalers. The reason is the manufacturers would never face any problem given their grip and ability to manufacture the raw materials. But the wholesalers are the ones affected as their only source of sale is either another wholesaler or retailer.
The business practices that initiated with a barter system are now currently moving to an online era. The era of online business is seen to get its dominance on the entire business segment. Anything currently is available online and with multiple options it becomes even much better for customers to access. This gives rise to the name E-commerce or online business as one of the most potential businesses to rule the next decades of business.
E-commerce Sales and Other Information
As per the analysis done in the recent festive season sales by multiple online websites, the sales figures have jumped by more than 35%. It is much better than expected given the slow down in the economy due to the inflation. On one hand where the wholesalers and retailers are complaining loudly about the sales getting loose, the online businesses are sitting on a rocking growth of 35% every year.
The major problem in online business is the trust factor. If a customer feels trusted he or she will not hesitate to buy that product online again and again. The trust has been built in multiple products including mobile phones, electronics, personal care, fashion etc. As a matter of fact in this year’s festive season of Flipkart the major sales were made for mobile phones. This was roughly around 45% of the entire sales.
On the basis of a report presented by an analyst at Redseer, the GMV or gross merchandise valuation of online companies is set to go above 5.9 billion dollars. Of this target 50% has already been achieved. The expectation of the growth during the festive season was roughly around 28% or 11.8 billion dollars. However the growth was 35% which means the festive season was received far more better than anticipated.
Sales and Online Platforms
The response from this year’s festive sales denoted that the non metro cities were actively participating in making purchases. The Tier-2 and Tier-3 cities were owing 60% of the entire sales figures. This means that the technology has penetrated very well and one can only expect these figures to go up.
Let’s consider the example of Meesho. It said that its sale ended with 33.4 Million orders or a 68% growth. The average order value for Meesho customers is 300 Rs. On the other hand Flipkart said that it added more than 4 million unique customers in this year’s festive sales. Also the customer visits during its festive sale period was more than 1 billion. This time of the year is very crucial for the online platforms as customers are always waiting to purchase goods during the special discounted prices given in festive season sales. Last year’s analysis displayed that Fkipkart was the leader with 62% of the market share. Amazon ranked second with a 27% of the entire market share. Amazon had an app download of 43.6 million in comparison to Flipkart’s 50.5 million. However this year Flipkart’s app downloads were around 35 million.
If we consider D2C then the interview of Zivame’s COO, Lavanya Pachisia can assist us well. Zivame is an online lingerie startup. The company sold almost 250 products every minute during its festive sales. This is 5 times more than its average sales every year. The Average order value ranges from 1500 to 4000 Rs. The major sales for its products came from tier 2 cities and above.
Further Business Expectation
It is no hidden fact that almost all businesses are headed towards creating strong sales online and connecting to more customers together. It has been evident by the fact that the online business platforms have been increasing in numbers but the sales are not going down. However the platforms like Meesho and Shopsy are witnessing a strong growth whatsoever even though it’s been a few years since their launch.
For the upcoming time it can be definitely said that the online businesses would be more dominant than the current retail mode of business. Also with time to come and metaverse getting user friendly everyday the entire shift can be noticed soon for customers to prefer online buying as a much better option than offline mode of shopping. This is not only applicable to the fashion or online platform companies but even applicable to Zomato, Swiggy, Nayyka, Paytm, OYO, Sugar cosmetics etc. who are trying to make their industries diversify into online businesses.
