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Small towns spend big online
Online shopping is growing fast in India and smaller towns are playing a leading role. They match metros when it comes to transactions, whether they're buying toys or two-wheelers.
"More than half our business comes from users in 450 non-metro towns. This segment is growing faster than the metros," said Vikas Ahuja, chief marketing officer of Myntra. com, an online retailer of apparel and footwear. "The sheer number of brands and variety of goods, not available in brick-and-mortar stores near them, is a big pull."
Buying clothes and jewellery online would be unthinkable for many people a few years ago. Today, these goods have a growing market online. "Touch-and-feel is the most important barrier, but guaranteed offers to take back products and return money, along with better service, is changing that," said Ahuja. "After a good first transaction, the propensity to spend online increases significantly."
For Snapdeal, which is aiming to create the largest assortment of goods online, 45% of transactions comes from tier-2 and tier-3 cities. "We have products in more than 500 categories, ranging from keychains to two wheelers," said Tony Navin, vice-president, business development at Snapdeal. The company is planning to add 100 categories, including paint and tyres.
This increased variety is a major factor behind the growth of e-commerce sites as they put online stores head-to-head with local shops, and build on it with the convenience of home delivery and lower prices. "One impacts the other. As consumers see the product offerings increase on portals, they are more inclined to purchase online," said Nikhil Rungta, chief business officer of Yebhi.com, an online retailer, which gets 20% of its orders from smaller towns.
Flipkart, one of India's earliest online retailers, began with books, and has expanded to everything from sunglasses to home furnishing. Its registered users have grown from four million in November 2012 to 10 million users this month.
Myntra has 600 brands compared to around 300 last year, and 45,000 listings compared to 25,000 a year ago. It is handling 12,000 to 14,000 orders a day.
Retailers are also getting interested in going online as it helps them sell their products on a national platform. "Just two or three years ago, retailers were apprehensive about the revenues they would earn online, and we had to work hard to convince them. Today, they know the opportunity and come to us for implementation. There has been a 300% jump in the sign-up rate in the last 12 to 18 months," said Murali Balan, founder of Tenovia Solutions, which helps put vendors online through marketplaces and their own e-commerce sites.
"With the popular marketplaces, retailers start earning revenue from day one. Their market grows exponentially to include the entire country, and is not restricted to the city and states they have retail stores in," he said.
"More than half our business comes from users in 450 non-metro towns. This segment is growing faster than the metros," said Vikas Ahuja, chief marketing officer of Myntra. com, an online retailer of apparel and footwear. "The sheer number of brands and variety of goods, not available in brick-and-mortar stores near them, is a big pull."
Buying clothes and jewellery online would be unthinkable for many people a few years ago. Today, these goods have a growing market online. "Touch-and-feel is the most important barrier, but guaranteed offers to take back products and return money, along with better service, is changing that," said Ahuja. "After a good first transaction, the propensity to spend online increases significantly."
For Snapdeal, which is aiming to create the largest assortment of goods online, 45% of transactions comes from tier-2 and tier-3 cities. "We have products in more than 500 categories, ranging from keychains to two wheelers," said Tony Navin, vice-president, business development at Snapdeal. The company is planning to add 100 categories, including paint and tyres.
This increased variety is a major factor behind the growth of e-commerce sites as they put online stores head-to-head with local shops, and build on it with the convenience of home delivery and lower prices. "One impacts the other. As consumers see the product offerings increase on portals, they are more inclined to purchase online," said Nikhil Rungta, chief business officer of Yebhi.com, an online retailer, which gets 20% of its orders from smaller towns.
Flipkart, one of India's earliest online retailers, began with books, and has expanded to everything from sunglasses to home furnishing. Its registered users have grown from four million in November 2012 to 10 million users this month.
Myntra has 600 brands compared to around 300 last year, and 45,000 listings compared to 25,000 a year ago. It is handling 12,000 to 14,000 orders a day.
Retailers are also getting interested in going online as it helps them sell their products on a national platform. "Just two or three years ago, retailers were apprehensive about the revenues they would earn online, and we had to work hard to convince them. Today, they know the opportunity and come to us for implementation. There has been a 300% jump in the sign-up rate in the last 12 to 18 months," said Murali Balan, founder of Tenovia Solutions, which helps put vendors online through marketplaces and their own e-commerce sites.
"With the popular marketplaces, retailers start earning revenue from day one. Their market grows exponentially to include the entire country, and is not restricted to the city and states they have retail stores in," he said.
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