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Why Is India Not Ready For An App Only E-Commerce Platform?

Why Is India Not Ready For An App Only E-Commerce Platform?
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You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

When Myntra announced the app-only based e-commerce platform last year, it was touted to be the next big phenomena in this space. However, the plan backfired for Flipkart-owned Myntra, which led the company to roll back its ambitious plan. The company saw a dip in numbers and traffic on its platform, which clearly indicated that Indian consumers weren’t warming up to the app-only phenomena.

Speaking in this context, Nitin Bawankule, industry director for Google India, said we should let the consumer decide the right platform for him to use. “If the consumer decides the desktop is the right platform, let him come to our platform via the desktop and similarly if he thinks app is the right platform, let him use that as a modem,” 

Google along with management consulting firm ATKearney spoke on the various omni-channel modes that will drive digital e-commerce growth in India  in future.

Nitin said that India is nowhere close to becoming an app-only nation when it comes to e-commerce. “The reason is the number of smartphones is 150 million versus 800 million total phones in India – which is less than one-sixth of the total phones. Secondly, even the smartphones that you have in India 50 percent of them have less than 1 GB memory; which means that you would store only five apps on your phone. If you have five apps, it means that you would end up deleting all the other apps that you aren’t using.”

“So if the consumer is going to delete your app when he doesn’t need your app you will have to spend every time he downloads the app.  It’s a multiple level challenge,” Nitin said.

Nitin further went on to say that if a customer is loyal to a brand he would keep your app but if he is someone who comes on and off to your platform will come through multiple sites, so let him come via website.

Categories that haven’t been explored sufficiently by the ecommerce space

Nitin said that fashion and beauty are two categories that haven’t been explored to its maximum potential in the ecommerce space. “ If you look at beauty and personal care, less than 1 percent  of this category is sold online, whereas 25 percent of smartphones in India are sold online. From less than 1 percent even if it can touch five percent one imagine the GMV available in the beauty and personal care category,” he said.

The second category according to Nitin that could be explored further is home furnishing and furniture.  “Less than 0. 5 percent of the total home furnishing products are sold online. Even if it can go to a 3 percent or 5 percent growth , we are seeing a 10X or a 20X growth,” he added.

Going by the smartphone usage statistics quoted by Nitin , it looks like the Indian consumer still has a long way to go before it adopts the app-only platform.

 

 

Edition: December 2016

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