There are four aspects in a sale of goods, namely – order, product, payment and delivery. Given abysmally low card penetration & prevalence of a parallel economy, cash-on-delivery (COD) is the preferred option for Indians. Hence, three aspects of the four cited above – product, payment and delivery to consumer are offline with only display and sale ordering process being online. Pick-up points of online retailers are as near as they have already gone to the offline model.
Further to counter the challenge posed by online business established offline players have adopted an omni-channel strategy adding online to their portfolio. For example, Aditya Birla Group has started an online fashion portal “abof” that will take on the likes of “myntra” and “jabong” or in the service space “Young Turks” – the show on CNBC TV 18 that directly competes with “Your Story” featuring exclusive online stories as well.
Online-only ventures will have to look to provide more value to their customers and not just discounts in addition to bracing up for more competition from both established & newer niche startups. What helps them is the fact that they have created new brands and now have an opportunity to cash them in. Offline will enable new generation online businesses with an option to leverage brand visibility into reach. What I am trying to convey is are we going to see “Exclusive Myntra” stores in malls for that set of customers who still value sensory touch and feel or a TV Series “Your Story” on ET Now or UTV Bloomberg – a competing business channel to CNBC TV18 that yet does not feature a competing show.
CA Nirmal Ghorawat's Blog 