Net Retailing - Current Indian scene

In my past two posts, I have tried to touch upon the history and the current status of retailing in India, and the issues faced by the industry as a whole. In this post I want to talk about online retailing. Considering India's status as the premier destination of IT outsourcing, and the large count of young, net savvy population of urban Indians online retailing should have done very well in India. Unfortunately reverse seems to be the case. A popular concept in the West, e-commerce has been slow in picking up in India. 

While portals like rediff and indiatimes have made some headway, in getting the Indian consumer to shop online, the list of items stocked still range more towards consumer durables, including items like electronics and white goods, books and CDs. For Indians wanting to buy groceries or Fast Moving Consumer Goods online there is little choice. There is no Tesco or Sainsbury for Indian consumers.

The reason is not far to seek. At present online shoppers in India usually experience poor quality of goods and services, lack of trustworthiness and inexplicable delays. Market research says that Indians will shop online when they have to. However, quality of online retailing in India leaves much to be desired. The writer himself had an unpleasant experience recently while shopping with Indiatimes. I had ordered a set of children's books for my nephew as a birthday gift one week in advance. I had specified that the gift should be delivered on his birthday. 8 days after ordering the gift, and a day past his birthday, I got an email from Indiatimes stating that my order has been cancelled. yes you got that right. C-A-N-C-E-L-L-E-D.

This happened 4 days ago. The money was supposed to be mailed to me in the form of a gift voucher (which means I will be forced to shop with Indiatimes again) within two days. No points for guessing that I still haven't received any gift voucher. In more mature economies like the US such portals would have been laughed (or sued) out of business. Here they continue advertising themselves as India's premier online shopping portal.

Last year I had an even worse experience while shopping from rediff. Again it was my nephew's birthday and I had purchased a toy for him. The toy was delivered late, and in a damaged condition. When attempting to complain, I realized that they had no customer care centre. I had to correspond using email. Someone was sent to my brother's place to collect the defective toy. It was replaced after a month.

What is the probability that I will again shop online from any of these 'premier' portals. Very close to zero I believe! As I had stated before, India's online shopping portals suffer from a credibility issue. They provide poor service, lack accountability and are generally unreliable. What does it say about the state of e-commerce in India if I tell you that irctc still contributes 1/3rd of the total volume of e-commerce in India? Indeed something to worry about.

I will talk more about the state of e-commerce and online retailing in India in my subsequent posts.