eCommerce Blog

eCommerce Blog – Opportunities in US and India (by Darpan Munjal)

Where is the differentiation ?

Posted by Darpan Munjal On October - 17 - 2007
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My daughter will be turning 5 in a few days and unfortunately I wouldn’t be able to celebrate the birthday with her because she is currently in Chicago with her Mom. So I was talking to her on the phone, and asked her what would she like for her birthday present. She thought for a few seconds and then asked me inquisitively – “Daddy, how are you going to get me a present? You are in India, remember?” Smart question, I thought. But few seconds later, came an even smarter response from her. “I know!” “How about if you order it on your computer and, like before, I will get it in that brown box from Toys’R’Us .com“. I thought to myself – wow my little daughter is growing up. She may not understand what eCommerce is but she does understand that you can do something in the computer, and few days later a brown box is waiting for her in the front of the house! She almost believes that Toys’R’us has deputed little magical Santas inside every computer, and they are able to send exactly the toy children wish for!!

What really impressed me was the fact that she remembered Toys’R’Us.com and could associate it with someone who could help in meeting her birthday wish. This got me thinking about how online retailers in US have been able to create a unique enough differentiation for themselves where customers know exactly what these retailers stand for. There are some retailers in US that are still struggling with this, but at a broad level, most of the retailers (online as well as traditional) have found a unique proposition for the customers. Whether it is the largest assortment (Amazon.com) or value for money (overstock.com) or discount electronics (Newegg.com) or Jewelry & Gifts (Bluenile.com) or upscale household category (William-Sonoma) or a great service experience (Zappos.com), there is a lot of differentiation. If a 5 year old can recall Toys’R’Us when they are thinking of toys, imagine how easy would it be for a grown up to do the same across various categories. Then I thought about the Indian context and I tried really hard to think about all the unique things that the online retailers in India stand for. I thought about product assortment, pricing, categories, service and after trying really hard, I wasn’t able to come up with any meaningful differentiation that really sets one retailer apart from other. True, there are some retailers that offer a bigger assortment than others – but more or less all other dimensions are similar across most of the online retailers.

Then I thought, what is it that Indian customers think about before shopping at one retailer vs. other. I also asked this question to a lot of individuals who I know have been online shoppers for quite some time. The results of this “unscientific” study were very disturbing Read the rest of this entry »

5 things to consider when starting an eCommerce venture

Posted by Darpan Munjal On September - 18 - 2007
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The other day, I met someone at a conference who mentioned to me that he was planning on starting an online retail venture in India. He said he has already begun the software development for the platform and one of his friends is a great SEO person so marketing should not be an issue. Is there anything else critical that he should plan for, he asked? Although his level of planning (or lack thereof) didn’t give me a lot of confidence in his venture, it did give me few ideas for topics that I should write about in my Blog.

 

Although technology plays a critical role in building an eCommerce operation, just focusing on a technology platform without careful planning of other factors is a recipe for failure. I have heard a lot of people say that successful eCommerce companies require a strong technology orientation and should therefore, be led by a technology team. Although a technology leadership can certainly help, having a strong technology foundation doesn’t obviate the need for traditional factors that make a retail business successful. Customers don’t buy products in an online store just because they love the technology. At the end of the day, it comes down to having the right mix of products, at the right price, coupled with a strong execution and end to end experience that is difficult for other competitors to copy. No doubt that technology can and should play a key role in all above factors. However, one must remember that technology is like a foundation of a house, it is a necessary component, and if poorly designed, it can destroy the house. However, Read the rest of this entry »

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