Growing Online Presence in India

The sheer number of online business models coming live in the online   space is making this arena more interesting and attractive. In the last two years the amount of money flown in to this space by the venture capital funds and angel investors is real testimony to a prove a point beyond doubt that Indian one line business market is growing like they were never before , be it in the space of health care , e-tailers, travel& tourism, hospitality and many more , entrepreneurial zeal to chart out new models with different offerings are already on the anvil. The confidence is completely derived out of the ever increasing internet users ,Burgeoning , aspirational middle class who has much dispensable income , affinity to try out new things and product as when it get introduced in the market place.

As per the statics India has currently 243 million citizen using internet services through mobile and computers, which is expected grow at much faster space in the coming years. The rising clout of e-commerce sales in countries like china & USA is about 43 billion USD, But currently our nation is still in its infant stage which is about 9 to 10% of the shopping through online, but it is a well known fact that this figure is going to catch up soon in the coming years. Don’t you think that 1.2 billion populations with every increasing penetration of mobile phones, internet services, VOIP is great opportunity, market place for a lot startup to take its wings by exploiting the users to shop, avail services online. I think if my memory is correct in the last 3years you could find new startups coming live with confidence, and later it is getting capital from venture funds to expand its operation further. More than ever before the investors from overseas and Indian are brimming with confidence to get their hands soaked in online ventures.

Online business models in India.

  • Online market Place: Websites like Flipkart,Myntra & Amazon follow this model , where our regulation don’t allow multi brand online inventory , so suppliers can list their products in the website , ecommerce portal get commission on the transaction.
  • Inventory based model: In this model companies would set up their own inventory and the logistics, but they can have real control on the logistics and cost of operation is very higher. As per current regulations multi brand retailing is currently not allowed in India, but single brand retailing is possible.
  • Affiliate marketing model: This model promotes other companies products through advertisements and links, when customer clicks on the advertisement they earn a commission out of it.
  • Online brick and mortar retailers: Here the basic retail shops sets up websites to offer products of particular brand and merchandise will be shipped directly from the go down to the customer.

If we take the segment wise online sales the electronics holds the major share of the pie with 34%which is slightly above apparel & accessories with 30% and books owns third piece of share 15% ,rest of the segments put together holds the remaining share .

market share

Economic Impact :

The economic impact of on India’s GDP is less than 2% where as in USA it is above 4% , Internet contribution is growing at much faster pace than India which is 14% versus 2%

Source Interent live stats

The scope for scalability in online consumers in India needs to major change , but potential is huge, but several bottlenecks like availability of infrastructure , band width are the major blocks which could curtail the potential for growth, Imagine a population of 1.2 billion we are only 2% of perceived potential , so with more support , technology we can scale up and reach to rest of the population .

Bottom Line :

The likelihood of online presence in all sectors is going to improve , companies who are already in the business has started deploying teams to implement online platforms like mobile apps ,electronic mediums to improve the customer’s experience for example banking sector is widely perceived as one sector going to harness the potential of online mediums . For start ups to get blossom behind the curtain motivation is lesser capital or seed capital , comparatively less infrastructure when compared brick and mortar business models.


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