Thursday, February 12, 2015

Will there be an Indian version of Alibaba?

Google trends never ceases to amaze me. It turns out that when measuring search interest on topic "Online Shopping", major India cities takes the leading position. 
It is not a total surprise since major India cities are densely populated and major residents in cities such as Bangalore work in the IT industry, which makes them "easy targets" for online shopping. Plus, big cities accommodates better and faster delivery services at a much lower cost. 

In big Chinese cities like Beijing or Shanghai, it is normal to get your merchandise within the same calendar day (Yes, calendar day not business day, weekend included!!) we clicked the purchase button. A typical same day delivery costs customers about 1 dollar, while a typical delivery guy receives 25 cents for every single delivery. In order to save gasoline, delivery is often made with a motorcycle instead of truck or mini-van.

According to Wikipedia, nowadays, Indian online shopping industry is only one-tenth the size of Chinese. Obviously, there's room to grow. Since basically, India has the same advantages including dense population, cheap delivery workforce, increasing numbers of internet users, global investor, especially venture capitals are attracted by their strong growth prospects. They have strong hope that another Alibaba would be born there. (Please note that I am not implying any investment suggestion.)

Learning from the experience of US and China, C2C sites like Ebay and Taobao would be the first to grow. Despite the negative factors such as quality concerns, lower price is encourages people to have their first bite. After a chaotic era with little regulation, while people starts getting used to the idea of shopping online, B2C giants like Amazon would gradually take the market share away, and form its monopoly empire. Long way to go for India.




Let us just wait and see the future development of our beloved online shopping in India.

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