E-Retailing

Meaning of E-Retailing
E-retailing uses internet as a medium for customers to
shop for the goods or
services. It can be either pure-plays or bricks-and-clicks.
Pure-play uses
internet as primary means of retailing while bricks-andclicks uses the
internet as an addition to the physical store.
Now a day retailers have started offering almost
everything under the sun on
internet. From products like groceries to services like
online gaming and jobs,
e-retailing covers all frontiers.

Unfortunately, India has lagged in e-retail growth story

due to low density of
internet connections, lower penetration of credit cards and
customer anxiety
in using new technologies.We now discuss these issues
and suggest possible
avenues for e-retailers to turn them to their advantage.

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Introduction
The e-retailing(less frequently; e-Retailing, e-Tailing, etc.) is the
concept of selling of retail goods using electronic media, in
particular, the internet. The vocabulary electronic retailing, that
used in internet discussions as early as 1995, the term seems an
almost in evitable addition to e-mail, e-business and e-commerce,
etc. e-retailing is synonymous with business- to- consumer (B2C)
transaction model of e-commerce. Although e-retailing is an
independent business model with certain specific constituents
like; trust model, electronic transaction process, etc, but in reality
it is a subset of e- commerce by nature.

E-Retailing stores sell online promotion only for goods that can be
sold easily online, e.g., Amazon did for Books & CDs, etc. The
online retailing require lots of displays and specification of
products to make the viewers have a personal feel of the product
and its quality as he gets while physically present in a shop.

E-Retailing refers to retailing over the internet. Thus an eRetailing is a B2C (Business to customer) businessmodel that
executes a transaction between businessman and the final
consumer. E-Retailers can be pure play businesses like
amazon.com or businesses that have evolved from a legacy
business such as tesco.com. The e-retailing is a subset of ecommerce. Thus, e-commerce is the master domain defining the
e-retailing operation.
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Definition
Electronic retailing (e-tailing) is a buzzword for any
business-toconsumer (B2C) transactions that take place over the
Internet. Simply
put, e-tailing is the sale of goods online. Companies like
Amazon and
Dell created the online retail industry by putting the
entire customer
experience - from browsing products to placing orders to
paying for
purchases - on the Internet. The success of these and
other companies
encouraged more traditional retailers to create an online
presence to
augment their brick-and-mortar outlets.

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Features
1) The provision of an on-line catalogue, which allows one to
browse through differentcategories of goods. Thus, it is
dynamic and linked with order process
2)
The provision of a search engine, which is a
very important feature that does not exist.
3) The provision of a shopping cart, which allows convenient
goods selection.
An abilityto provide an automatic price update.
4) Personalization of store layouts, promotions, deals,
and marketing.
5) The ability to distribute digital goods directly.
6) An on-line customer salesperson, who can help
customers to navigate through.
7) An order status checking facility, which is
a useful feature before submission.
8) The use of Forums (collaborative purchasing circles) to create
a customer communityand thus increase stickiness.

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Common features of e-retailing web

sites include:
method for selecting your purchases, eg shopping
cart
mechanism for creating and submitting an order
secure e-payment facility
appropriate distribution mechanism
browsing facility, normally by subject or by category
searching facility
mechanism for customer service and feedback

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Essentials of ERetailing
Electronic retailing or e-tailing, as it is generally being called now, is the
direct sale of products, information and service through virtual stores on
the web, usually designed around an electronic catalogue format and
auction sites. There are thousands of storefronts or e-commerce sites on
the Internet that are extensions of existing retailers or start-ups.
Penetration of computers and proliferation of the Internet has given rise to
many new forms of businesses, such as business process outsourcing, call
centre based customer relationship management, medical transcription,
remotely managed educational and medical services and of course,
electronic retailing.
There are certain essential ingredients for an electronic retailing
business to be successful. One must consider these components
well in advance before setting up an electronic storefront. These
essential components are:
Attractive business-to-consumer (B2C) e-commerce portal
Right revenue model
Penetration of the Internet
E-Catalog It is a database of products with prices and available stock.
Shopping Cart The customers select their goodies and fill shopping cart. Finally, as in a
real store, at the time of checkout, the system calculates the price to be paid for the
products.
A payment gateway Customer makes payments through his/her credit card or e-cash.
The payment mechanism must be fully secure.
Support Services in E-Retailing

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The electronic retail business requires support services, as a prerequisite for successful
operations. These services are required to support the business, online or offline,
throughout the complete transaction-processing phases. The following are the essential
support services:
Communication backbone
Payment mechanism
Order fulfillmentLogistics

E-retailing in
India
During the dotcom boom Ecommerce was the sunrise
industry, the one that would change the face of the world.
While Ebay and Amazon the twin pillars of Ecommerce in
US did bring about paradigm shift in USA, the tech pundits
in India are still a bit iffy about Ecommerce in India.

The Ecommerce market is expected to touch 9210 Crore INR

in 2007-08, E Tailing or E RE-tailing market is only about
1150 Crore INR according to a survey conducted by Internet
and Mobile Association of India and Indian Market Research
Bureau (IMRB).

For the purpose of this article E-tailing is defined as

Ecommerce sites including auction sites that sell groceries,
apparel, CDs, books, electronic items, gifting item etc but
exclude travel, digital downloads and online classifieds sites.

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The top E-tailers in India

are indiatimes.com, fabmart.com, rediffshopping.com. They
have managed to retain their lead due to innovative
business strategies, supply chain model and changing urban
lifestyles

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EVOLUTION OF ERETAILING

E-retailing has become an accepted mode ofretailing

though one that will ultimately capture agood market share
of total retail sales .

E-retail players from all over the world, includingthe US.

Amazon.com, Buy.com, eBay, J.C. Penney,Lands End,
Office Depot, and The Sharper Imageare among those
retailers that have developed e-commerce sites
specifically to serve market

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Major trends of e
retailing
Technologies that help you see and experience the product
better
e.g. virtual reality, Java 3D etc.
Technologies that help you not to see at all but use an
intelligent agent (or mobile agent) that does all the
shopping tasks for you

Affiliate website through referrals

Pros: a link in the famous website may provide a
good rank to the site
Cons: risk of loosing the customers to competitors

Business portals
Pros: government support to the portal
Cons: some big players are involved in it so
through market study is required

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SCM in ERetailing
Supply Chain Management is a top strategic objective
for many companies. Supply chain management is flexible
enough to cater to the demands of customer as and when
there is a demand. Supple supply chain fulfills the
requirement of what the customer wants, when and where
it's wanted and at the lowest possible cost. The supple
SCM
is only possible when management practices are
integrated with information technology to optimize
information and product flows among the processes and
business partners.

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Three level of e
retaling

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Social Presence in E
Retailing
Social presence (SP) is the extent to which a
medium allows users to experience others as being
psychologically present

It can also refer to the richness of the media or the

interactivity afforded by the media

SP could also be connected to the warmth felt

through the medium. A feeling of human contact
....Sociability ....Sen sit ivity

Instilling human warmth through:

actual interaction with other humans
stimulating the imagination of interacting with other
humans
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The Boom in
Electronic
Retailing
Video Marketing
Nonstore retailing to consumers via standard and cable television

Electronic Shopping
Nonstore retailing in which information about the sellers products
andservices is connected to consumers computers, allowing
consumersto receive the information and purchase the products
in the home

Electronic Storefront
Commercial Web site in which customers gather information
about products, buying opportunities, placing orders, and paying
for purchases

Cybermall
Collection of virtual storefronts (business Web sites) representing
a variety of products and product lines on the Internet

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Advantages &
Disadvantages of eretailing

On the other hand, there are a number

of advantages for retailers. First,location is unimportant.
According to some textbooks, adapting an old saying, the three
most important elements in retail are
location,location and location. The best high street locations are
therefore expensive. The e-Retailer, though, can sell equally well
to anywhere in the country, and even overseas. Second, size does
not matter: small e-Retailers can compete on equal terms with
large ones, and reach a larger audience than the high street
and be open twenty-four hours a day. For example, the
independent bakery Bothams of Whitby in northern England has
been a pioneer of e-Retailing and become one of the bestknown UK case studies.

Retailers have been slow to take up e-Retailing. This is to

some extent under standable in the light of the
many disadvantages and problems.Retailers, for example, may
lack the technical know-how, the substantial investment required
or the order fulfilment capabilities. Set-up costs start from around
20,000 fo a small site, up to 500,000 for a large operation. And
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set-up costs are only th start: Datamonitor estimates that

high street retailers are spending more o ongoing coststhan on
setting up new sites.

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Benefits
Electronic retailing is a powerful marketing technique for the right
product with the right message to the right person. But what makes for the
right combination? Why do consumers respond to TV offers or shop online?
The short answer is that the consumer benefits. People respond to
electronic retailing messages because it is to their advantage to do so. It
addresses their needs, either practical or psychological.
Electronic retailing, whether on TV or the Internet, is about motivation. How
do you influence someone to do something - to pick up the phone or log on
to a Web site and then make a purchase? Consumers will buy a product or
service through an electronic retailing campaign because they perceive its
value or because it makes them look better or feel better about themselves.
They do this even though they cannot examine the product in person and
may have to wait four to six weeks to receive the product. They accept
these drawbacks for various reasons, including:Convenience. For people
who are pressed for time and do not enjoy shopping, an electronic retailing
product may take on added value because the buying transaction can be
completed without hassle, quickly and at hours when traditional retailing is
unavailable. It saves them time and energy.
Early access. While many electronic retailing products are available in retail
stores at some future date, the spot, infomercial or Web site offers the
product now.

An electronic retailing campaign may be the only place where it is

available immediately. If the product solves a difficult problem or offers an
important improvement, consumers who buy from the electronic retailer can
have the product in their hands sooner.
Innovative or unique products. Getting a new, innovative product to market
through traditional channels is expensive and time-consuming, and it
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requires some luck on the part of the product's developer. Electronic

retailing allows a product's developer to bypass this process and sell
directly to end-users. Consumers who see or hear an electronic retailing
campaign get access to products that may never show up in a retail store
because the developer lacked the resources to take on the massive retail
industry.

Better salesmanship. Let's face it: Most products are not wellmerchandised. Key sales messages are poorly communicated or may be
missing entirely. Electronic retailing often overcomes these problems,
because the medium itself - television or the Internet - allows the person to
be sold the product. They understand how it works and why. The benefits
are presented clearly and convincingly. And make no mistake about it:
People enjoy being sold to.
So what's in it for marketers? Perhaps the scales are tipped in favor of
consumers, particularly in today's e-commerce environment. But for a
marketer with a new product, electronic retailing can be a cost-effective
method of testing a product's viability in the marketplace. A successful
electronic retailing campaign not only generates revenue but also builds
brand awareness and paves the way for broader distribution.

That's not to say that electronic retailing does not have its pitfalls. While
the cost of entry is low compared with the cost of mounting a traditional
retail strategy, a poorly executed electronic retailing campaign can cost
hundreds of thousands of dollars. And once launched, a product can be
"knocked off" by an unscrupulous competitor.

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CONCLUSION
In emerging markets, initiating an e-tailing
venture is easy but evangelizing, selling &
keeping customers happy is more
challenging.
Best model that works in India is -a
combination of retailing and e-tailing
Less number of Internet user; Mostly concentrated
in metros.
Availability of Brick n mortar shops at every nook
n corner thereby making it easy for customers.
Easy availability of domestics at affordable wages.
Aversion to using credit-cards owing to low
penetration and popularity of debit and credit
cards.
Logistics management

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