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Can Merchant Focused Approach Create Disruption in e-Commerce Industry? The shift in focus from the conventional Business to Customer (B2C) segment to the Business to Business (B2B) segment is currently trending in the Indian e-commerce sector.

By Sunil Gupta

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The E-commerce industry in India has gained significant growth over the years owing to rise in internet usage and increase in number of smartphone users, all driven by a growing need for quick and efficient access to goods and services. The host of opportunities present in this segment is touted to play a key role in giving a massive boost to the Indian economy and reinforce India's position as one of the fastest developing nations in the world.

In terms of retail, e-commerce in India is witnessing a phenomenal rise in online sales. According to a report published by Statista, the sale of physical goods via digital channels in the country was worth USD 16.08 billion in revenues.

Another report by the Indian Brand Equity Foundation suggests that the retail market in India is expected to nearly double to USD 1 trillion by 2020 from USD 600 billion in 2015, driven by various factors like rise in disposable income, urbanization of cities & towns, and shift in buyer attitude. In addition, while the overall retail market is projected to grow at a rate of 12 per cent per annum, modern trade is expected to expand twice as fast at a rate of 20 per cent per annum, and traditional trade at 10 per cent.

The shift in focus from the conventional Business to Customer (B2C) segment to the Business to Business (B2B) segment is currently trending in the Indian e-commerce sector.

The B2B e-commerce segment in India

The IBEF report suggests that India's B2B e-commerce market is projected to be worth more than USD 700 billion within the next 3 years, i.e. 2020, which is quite encouraging. In terms of contribution to the country's economy, the retail segment in India accounts for 10 per cent of India's GDP. The report further states that the online retail segment is projected to gain substantial growth by 2021.

Despite such positive numbers, the B2B market is quite small in terms of size and market presence as compared to the B2C segments, which currently dominates the Indian e-commerce segment. Therefore, the need of the hour is to develop a strong tactic that can help B2B based businesses create undisputed niche in the consumer focused e-commerce industry.

Can the merchant focused approach of B2B help retailers gain strong foothold in B2C dominated e-commerce segment?

In a report titled "Consumerization of E-commerce', LYONSCG – a premier e-commerce digital agency, states that several B2B companies, especially non-tech businesses have slowly begun to realize the importance of having an e-commerce presence. They are now shifting their resources from conventional catalogue-based sales channels to more lucrative e-commerce networks, and in the process, forming the basis for "consumerization' of B2B e-commerce. While this is just one approach to effectively disrupt the B2C dominated e-commerce market, it certainly gives the idea that there is scope for growth of B2B segment in Indian markets.

This shift is ably supported by some companies in India that offer a platform to sellers and buyers to interact and provide certain paid services to facilitate better placement, exposure, or response. They are playing a key role in connecting manufacturers, exporters, suppliers, and buyers to generate value from unlimited online trade opportunities and buyer enquiries.

What's more, few companies follow the Pay per View model, wherein the buyer's requirement is converted to a supplier's lead giving their users complete value for their money. All relevant leads as per the chosen products/services are displayed, and payments are made only to view the chosen leads that attract the attention of the buyer and seem worthy enough to be procured. After the payment process, the complete details are accessible to the buyer following which they can process the lead to materialize it into their business.

Going by such positive trends, it can be assertively stated that merchant focused approach in B2B segment can certainly create disruption in the consumer focused e-commerce industry in the long run, as long as it effectively utilizes opportunities available within the realm of e-commerce.

Sunil Gupta

Founder & Director, ExportersIndia.com

Sunil Gupta is the Founder & Director of ExportersIndia.com.
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