"Intent to purchase is now driven via mobile"
The contribution of e-commerce site traffic to the online shopping category via mobile has increased from 8 per cent to 20 per cent and on tablet from 2 per cent to 6 per cent in 2013. About 61 per cent of smartphone users in the country, according to a syndicated research, have spent money via their mobile phones on purchase. The top purchase categories are digital goods at 37 per cent and movie tickets at 24 per cent. This is followed by clothes, travel and financial services at roughly 16-22 per cent. The overall mobile ecosystem in India has created favourable conditions for m-commerce to explode. The few reasons for this trend include the fact that devices are becoming cheaper - cellphones are far cheaper than desktops and laptops. The second is mobile internet connectivity. According to Trai, there are over 431 million internet capable mobile devices in India, making access easy for consumers across the length and breadth of India.
Third is access; the on-the-go nature of the mobile phone makes purchases of low hanging categories like movie tickets, fast food, digital goods more convenient than ever. Fourth is personalisation. It is a big advantage for marketers as the nature of the device can help deliver personalised communication, therefore, aiding better receptivity when it comes to transactions.
The larger question is whether to develop a mobile site or an app to aid transactions? However, this issue is redundant in a country like India. I don't think it's a choice anymore. It also doesn't depend on the retailers/merchant; it is basically about how consumers are browsing the content via feature phone or a smartphone. Hence, one needs to have both access modes - a mobile-optimised website as well as a mobile app.
Also one must take into account the ROPO (research online, purchase offline) effect that didn't get e-commerce to explode in the early days. It has now become the ROMPO effect of research on mobile and purchase online. While transactions may not be at an explosive pace on mobile, ROMPO has ensured that intent to purchase is now driven via mobile. Cash on delivery is a great innovation therefore for m-commerce as it surely fuels purchase via mobile.
The largest apprehension is that consumers refrain from transacting high value items on mobile. But this is changing gradually.
Vinod Thadani, CEO, Madhouse India
"Apps have high uninstall rates"
Traditionally, there have been two approaches, either offer mobile-optimised websites or dedicated apps across mobile operating systems. Both the approaches have their own unique advantages. The mobile-optimised website is useful when it comes to channels like search engine optimisation, direct searches and users clicking newsletters. In fact, a mobile-optimised website in today's digital landscape with its preponderance of smartphones is de rigueur. A mobile website would also be something a lot of first time customers would be accessing for their first purchase or look-see.
The other approach involves creation of dedicated apps. Again, thanks to the rise of the smartphone (even in a price sensitive market like India) apps have become a major relationship building and maintenance tool for businesses and their customers. Considering that single app companies with enough downloads command stratospheric valuations, the impact a good app has cannot be ignored. In fact, apps are a powerful user engagement tool that is also a major insight into user behaviour and requirements.
To go via the app route or the mobile website route is a question baffling lots of digital businesses. However, here at Snapdeal, we like to believe that we might have solved the problem. For us it isn't about whether mobile site is better or an app. We believe that a synergistic effort emphasising on both is key to realising success in the m-commerce space. The challenge lies not only in the sheer numbers of mobile devices but also their mind boggling variety. In fact there are over 4,000 different devices that we need to cater to. Optimising a website over such a broad range of technical requirements is no easy task and has been a challenging goal for us to say the least.
Even when it comes to apps, the number of operating systems in the market and their differing variants on different devices, make the task of developing an optimised app a hard nut to crack. The fact that apps need to be kept updated doesn't make the job any easier. However, with the right approach and right tools, even this seemingly formidable task can be accomplished.
Another challenge in the Indian space especially when it comes to mobile-optimised sites is the poor state of broadband speeds. This is an old problem and something we need to cater to. When it comes to apps, the primary challenges are in the realms of keeping user engagement alive and kicking and controlling the high uninstall rates. Smartphone users are a finicky lot, not exactly renowned for their patience and you need the app to have a very high degree of user friendliness and relevance to ensure that the app stays installed and is used.
"Ideally, app downloads would be the best way"
Over the last few years, e-commerce in India has seen a gradual shift from being a sector driven purely by e-shopping to mobile shopping. Industry projections measure 3G adoption to be at 250 million by the end of 2016. The increasing use of smartphones with access to the internet together with other circumstances like the improvement of the accessibility, secure transactions and multiplication of online stores have promoted the user to prefer m-commerce as a method of saving time and money. Furthermore, the exponential tablet and smartphone sales growth is revolutionising m-commerce, which is currently growing at 71.6 per cent CAGR.
We have seen a slow and steady growth in m-commerce , which is primarily hindered by network reach in India, that is, 3G. Also, the payment methods can be a problem.
However, e-commerce is driven by millennials, the generation of digital natives who heavy mobile users. The top products smartphone shoppers buy with their devices are apparel, accessories and event tickets for instance. Travel and entertainment products are the top categories with airline booking, hotel booking and movie/sporting events ticket booking ruling the m-commerce business.
M-commerce in India is still at an embryonic stage and e-commerce companies are still experimenting with mobile sites and mobile apps, to make shopping experiences for the customers convenient and hassle free.
Many companies are in a dilemma whether they should use mobile-optimised websites or mobile apps. In our view, both are equally important from different perspectives. Mobile-optimised websites give an opportunity to new customers to come and check offerings on mobile platforms since they are not regular customers and may not want to download an application on their smartphones without experiencing the portal. While at the same time, there would be a huge set of the existing customer base which is loyal and has experienced the services and would expect the application of their favourite portal to be on their phone for quick navigation and purchase. Ideally, if every customer starts downloading the application, that will be the best way but given the complexity, both are required.
The rise in native app experience (and web apps, to a lesser extent) enables seamless payments and the delivery of goods to the user. The next five to 10 years promise a big opportunity in this space.