Obstacles to real e-commerce experience in India

Several articles have been written, talk and interviews recorded on the topic of why e-commerce has failed to take off in India. Experts have predicted a boom, analyzed and delivered their judgment on why things are in the shape they are in. One simplistic and easy answer to give and close the discussion is to blame. A few popular inputs I've heard when I talked to folks having their e-commerce sites are:

1. Damn customers!! I hate these stingy guys
2. They prefer to go to shops and look around and buy.
3. Stupid folks don't trust the web.  
4. Most don't use credit cards online. That's why. 

I wanted to spend some time and offer my view - looking at the problem end to end. The basic workflow in e-commerce can be depicted as follows:

1. I want a product or a service
2. I go to the net
3. Find a supplier through a good search service or another website
4. Go to the online storefront
5. Evaluate the 'goodness' of the product or service
6. Pay for it [ Use my Credit Card or Debit Card or COD; Use a secure gateway to pay for it; Ensure that the payment has gone through ]
7. Need a courier name
8. Tracking Number
9. Product arrives at your doorstep.
10. Give feedback if it was worth it.
11. Expect to have a good replacement policy in face of customer dissatisfaction
12. Post Sale customer service to resolve "use" and "quality" related issues.

Throughout this process, we need a solid handshake that says, this is what you wanted, and this is what was done. I would like to use amazon.com as a reference and I am sure there are others which are very good. This is not to say that Amazon has no room for improvement. It simply in one site which has several of these critical pieces integrated neatly. By using a reference e-commerce site, it is easy to explain the non-negotiable requirements for a successful e-commerce site in India. In other words, we are trying to determine the crucial factors that can trigger the growth of e-commerce in India.

Index	Requirement	Issues in the current e-commerce implementations
1	Need for a product or service	1. That we prefer to shop in brick and mortar stores are a not just about Indian consumer behavior. Its true worldwide. However, most advanced economies provide for excellent mechanisms for ensuring that the product and service related information is made available to the customers. Good information leads to good decision making. 2. Today, the real fear in our consumer base is predicated on the level of poor information being handed out to the customer. So, the real argument becomes one of minimizing the level of getting cheated by being physically present and checking things out before making the decision. The fear is not something related to credit card usage on the web. It’s about the way the customer gets manipulated with a poor product and lies; without the support and luxury of a good report that discusses the product dispassionately. 3. Good e-commerce strategy must begin with good information to our customers.
2	Internet Access	1. While BB access is about 1.5% or so, Mobile BB penetration could be larger. Mobile penetration is not the same as mobile BB penetration. I believe that most of the penetration in India is with prepaid cards. Not necessarily a BB related one. But this also means that we have a platform for enabling mobile commerce but making internet come alive on phones. 2. Internet vouchers will seduce customers to use the net at the nearest cafe for a few minutes and make a purchase to gain a certain discount could be a start for creating a push factor for increasing e-commerce.
3	Search for a product or service	1. We need a nextag.com; priceline.com type services which will provide a one stop service for all products, reviews, specifications and prices. 2. There is a need to make consumer reports type platform a reality by providing a platform for addressing customer / consumer issues when they are not resolved by the suppliers.
4	Online Storefront	1. Range of products and services are very narrow. An online store like amazon.com competes well with a brick and mortar store like Barnes and Noble in terms of its ability to carry a large collection of related products and services. This is not the case in India. 2. Most shops provide for a few select models of watches, phones, other items - rarely a comprehensive range. 3. For the products and services offered, the supplier / storefront take no ownership to create the right level of customer awareness about the products in terms of technical specifications, product reviews and market feedback. The approach seems to be "if it sells, it sells. Else it is alright". 4. There is no goal orientation in the search processes in our websites. There are no websites that offer benchmark goal oriented product searches. What do we mean by this? Goal orientation of a cell phone can be in terms of talk time, number of Sims, pixels in camera, price, nature of keyboard. This is how we communicate in a phone store. I need a talk time of 5 hours with a USB charger, costing about 4000 INR, color display. Why would our approach online purchase decisions be different? E-commerce sites have not addressed the fundamental customer requirements gathering and product filtering procedures in their store fronts. Tigerdirect.com is an excellent site that gives us a sense of goal oriented search schemes. There was recent tweet from a celebrity that actually demonstrated the absence of goal orientation in our websites -  "Need Dual Sim, QWERTY, GPS, CDMA/GSM, Good Camera and talk time - what do you suggest?". Try getting an answer in our online shopping centers and you will understand what I mean by goal orientation. 5. We do not have an e-commerce enabling vehicle such as nextag.com or priceline.com which actually searches across multiple stores and offers the best price to the customers. Vacation planning sites like makemytrip.com attempt to do this. But fail miserably in providing true low cost alternatives. E-commerce must succeed with middle class if we have to see a boom in this space. This means budget hotels and budget travel alternatives need to be a dominant theme in our vacation / tourism enablers. Most sites in this segment stop with star hotel offerings. Most Star hotel users are the rich and famous or those whose stay is paid for by the corporate. This is too narrow a customer base for e-commerce to see an explosive growth. redbus.in is a definite step in the right direction. 6. For basic sale to happen, most of would want to see several competing alternatives along with pricing information. We do not have e-commerce enablers that can help us make a decision between formal shirts from Raymonds, Arrow, LP or Van Huesen. But this is exactly what a visit to the mall enables. 7. In order to enrich the shopping experience, we need to have an aggressive mail order campaign that provides for discount vouchers, fabric samples for people get a sense of the product feel - and other specific sale enabling tools.
5	Evaluation of the product	1. Product evaluation is simply a function of three vectors. One is to do with credible quality reviews about the products and services from people who make similar purchases. 2. We need a serious product review site / magazine that deal with consumer reports and evaluations. Such information is rarely available. 3. In most multi-brand stores, each brand is represented by a company representative who simply forces a buy decision by "misinforming the customer" that a competing product is not available. Credibility of such stores is always poor. But customers are forced to make a purchase because in the absence of quality information for making a decision, the poor customer is left with going with a "loud sounding advice", which is usually incorrect. 4. Online review tagged with the product along with the pros and cons about the product serve a very useful purpose of making the customer aware of the nature of the product from a price, performance and quality stand point.
6	Payment Procedures	1. Most sites accept Credit Card, Debit Card. 2. For handling people that fear misuse of a card, it will help if the customer can call a number to give his credit card details to make his transaction happen. For this to work well, this platform needs to be a credible one and not one of the outsourced companies who care a hoot for customer experience. 3. SodexHo type vouchers is an innovation that can be brought about. Banks and other establishments can sell such internet vouchers to the customers to encourage online internet transactions. This will address the "I am afraid to give my credit card number online" fear. 4. COD services must be enabled across the length and breadth of the nation. Today, a limited number of pin codes dealing with the heart of metros is what is serviced by private couriers. The India Post VPP service works across the nation; it is slow and inefficient. COD ideally enables pain free mechanism because the trust issue is eliminated. If business can work with an assumption that about 5% of the sales will be dishonored by COD customers, then this is a viable option.
7	Product delivery	1. Couriers handle metros and major cities well. 2. Tier-2 delivery performance is usually bad or even unacceptable at times. A package from Bangalore to Chennai has taken 4 business days because the person in a certain delivery area is in vacation. 3. No viable COD product from any of the couriers servicing the nation. It is no use providing COD in Metros, where awareness is high. COD is a viable non-metro / tier 2/3 / rural offering.
8	Feedback about the online experience	1. There is a need to build an online community that gives concrete and credible feedback. Amazon reviews and recommendations serve this valuable need.
9	Customer Service	1. IVR is OK, but most people want to talk to a person; there needs to a paradigm shift in the way we approach customer service with a personal touch. 2. Amazon.com provides a call back option where the customer enters a phone number and someone talks to him in a few seconds. This is an amazing customer delight generating factor. 3. gadgetsguru.com takes more than 3 months to process a refund claim and there is no communication from the site when the updates do not happen.
10	Customer Returns Policy	1. Customer returns policy needs to be fleshed out. In most cases, unhappy customers remain unhappy because our "sellers market" psyche forces a purchase decision irrespective of the nature of customer experience with the product. 2. What would it take for a no questions as asked refund - like it happen in USA?

As we can see, the real issues and obstacles to a successful e-commerce strategy in India are many. There is no dearth of customers who are ready to explore a paradigm shift. What we lack is an e-commerce industry which will deliver the real internet shopping experience that address several of the points mentioned above. 

Yes, there may be many more - but one thing is clear. E-commerce offerings in India is far from being 'production worthy'. Most are built around the premise that web programming is cheap and something can sprout fast. Remember the golden rule - if you pay peanuts, you will get monkeys :-) The industry needs to look at this as a scratchpad full of opportunities and make a solemn resolve to do something about it.