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Why Indians do not buy online?

[Guest article contributed by Kunal Shah, founder and CEO of Freecharge.in]

The Indian E-commerce industry has been poised for taking off for many years with the growth of Internet connections – which recently crossed a 100+ million users! However, number of online buyers stays put at around 10 million and number of non-travel buyers has hovered around 2-3 million for a while. The reasons cited in surveys and investor meetings over years are: fear of using cards/accounts online, lack of trust, lack of infrastructure, need of touch and feel etc.

I somehow don’t think any of these could be the real underlying reason for things to not take off. So here is a point of view which could throw some light in this big ecommerce mystery.

My first visit to US in 2001 was an eye-opener and a cultural shock for me and one thing that struck me the most was Americans were very independent and preferred self-service in almost all aspects of life, which I, like many Indians was totally not trained or accustomed to. I had a tough time to do my laundry, iron my clothes, make my own food/coffee, do my own dishes, get my own groceries by “Add to Cart” and “Checkout”, deal with self-operated fuel pumps, kiosks and vending machines, do my own bed…the list can go on and on.

Thus for US, Ecommerce was very natural. Natural cause Ecommerce although in its strict definition is “commerce conducted via the Internet”, is also “retail commercial enterprise or a service in which the customers or users help themselves”.

However “Help Themselves” and “Self-Service” is an alien concept to most Indians.

How many Indians live without help of maids? Iron their own clothes? Use Self-Service Check-in Kiosk at airports? How many vending machines exist and are used? Maps used for directions? Trays trashed at McDonalds? Make and get own coffee at offices? Paint their houses? Install all pirated software on computer themselves? File our own tax returns? Not many. In fact our first instinct is to find someone who can help us with it.

Infact I remember meeting some friends and their wives at a social gathering in US and being part of usual discussion of joys of moving back to India. One of the major reason they all talked about the luxuries of India of not having to do anything on your own and having help for everything from driver, maid, nanny, cook, office boy…it almost brought tears in eyes of some of the women 🙂

In India, I have noticed many a times, smartest and wealthiest walking up to an electronic store or an apparel store and standing there waiting for sales guys to walk up to them and assist them. We enjoy being assisted, in fact are handicap at most times without assistance. Whereas self-checkout counters are a big hit at physical goods stores in US as they don’t want to deal with people for their mundane tasks.

Unfortunately, most US ecommerce concepts have been blindly copied and served to Indians. I wonder at times if majority of Indians understand the words “Add to Cart” and “Proceed to Checkout”, as these words seem more natural to customers who are used to Walmart since 1980’s than Indians who call them “Trolly” and “Billing Counter” in physical world?

A lot of customization and behavior mapping needs to be done by India Ecommerce companies to win in this market. Companies will need to move beyond the standard “copy-paste” of west, but start to “HELP THEMSELVES”.

What are your thoughts?

Recommended Read: My Seven (Hard-Hitting) Questions To Indian Ecommerce Businesses

3 comments

  • loved this post as it tends to explore the real and underlying behavioral mechanisms involved in motivating an e-buyer to trust a machine and provide their card details. ‘Shopping experiences must be designed in such a way as to give the average Indian the feeling that there is an actual person behind the service provided, that it is personally catered to their taste or at least the illusion of it and most importantly developing trust. Loads of research needs to be done on the behavioral psychology of online consumers if the industry really needs to kick it off in India.

  • Bang on target, I love the article, though I feel there is trust and linguistics aspect to it..
    We are a bunch of guys trying to explore the Indian way of buying.. anyone who’s interested can have a word ..
    mail us at : i7022702220@gmail.com

  • There are numerous reasons why an Urban e-shoppers goes online to buy products of their choices –
    1) Convenience
    2) Experience
    3) Variety of goods / services
    4) Price / offers
    5) Return policy and CAD – driving sales
    6) list can go on

    The e-commerce is still at nascent stage and evolving with time – major focus is to solve a problem faced by large no of people (potential customers) – The ecosystem is not yet established as compare to West / US market.

    The important question is what if you get products at online discount price in a offline store. As per research finding, people are searching products online for price comparison and buying offline. How long any company will keep extending discount for customer acquisition and retention. Customer loyalty can easily shift from one e- store to other if the same product is available on other e-store at cheaper prices. Price comparison sites (only top 3-4 cheapest price stores gets visited by customers.

    Certainly market potential is huge, it would be interesting to watch which player will survive in stiff competition, high burn rate and not much innovation and how soon payback returns to investors.