market research report : e commerce market in india 2013

e Commerce Market Indiae‐Commerce Market – India

April 2013

Executive Summary

Market

Electronic commerce (e‐Commerce) market in India has registered a growth rate of over xx% in the year 20‐‐ from the year 20‐‐

e‐Commerce market size was pegged at INR yy tn in 20‐‐ and is projected to attain a CAGR ofMarket e Commerce market size was pegged at INR yy tn in 20 and is projected to attain a CAGR of about yy% to reach INR zz tn by 20‐‐

Online travel and retail segment continued to contribute the most in the market size for the year 2012, followed by online financial services, ‘other services’ and digital downloads

The e Commerce market is brimming with opportunities for vendors which when tapped

Market Opportunity

The e‐Commerce market is brimming with opportunities for vendors, which when tapped effectively, will provide vendors with a scope to build a sustainable future

Some of the major opportunities in the market include the following:

Social Network Domain

Tier II & III Cities

Trends

Some of the prominent trends identified in the market include the following:

Changes in Business Models

Tier II & III Cities

Mobile Platforms

Trends g

Refreshed Strategies

CompetitionMajor e‐Commerce Vendors

Flipkart Online Services Thomas Cook India Amazon eBay India

2E‐COMMERCE MARKET IN INDIA 2013.PPT

p Flipkart Online Services Thomas Cook India Amazon eBay India

Times Business Solutions Infoedge India Monster Worldwide Expedia India

•Macro Economic Indicators

•Introduction

•Market Overview

•e‐Commerce Technology

M k t B t•Market Boosters

•Issues Hindering Profitability of Players

•Trends•Trends

•Competitive Landscape

•Consumer Insights•Consumer Insights

•Market Opportunity

•Strategic Recommendations


Strategic Recommendations

•Appendix

An example of e‐Commerce system work model

Regional Logistics Support Regional Warehouse Logistics Support

Internet Enabled Devices

e‐Commerce Space

WarehouseConsumers

e‐Commerce Vendor


Financial Service Provider

e‐Commerce in India is fast evolving and is expected to mature further in the ensuing years

•Registering a y‐o‐y (Year‐on‐Year) growth of over xx% in the year 2012, e‐Commerce market is set course for a bright

future in India

e‐Commerce Market – India Overview

• Currently, the market is dominated by the online travel and retail segments followed by financial services, digital

downloads, amongst others

• Factors such as a huge presence of internet users coupled with a continual increase in purchasing power of the Indian

population is mainly boosting the marketpopulation is mainly boosting the market

e‐Commerce Market Size & Growth – India e‐Commerce Market Split (20‐‐) – India

INR tn

a

b

c

d

xxx

Segment 4

Segment 3

Segment 2

Segment 1


20‐‐20‐‐

0

20‐‐20‐‐20‐‐20‐‐

Segment 5

SAMPLE e‐Commerce Market India (x/x) – Online xxx Overview

•Commanding, a market share of about , the online xxx segment drives the e Commerce market

Online xxx – Snapshot Online xxx – Benefits for Players

online xxx segment drives the e‐Commerce market•Mainly comprises of abc, def & ghi• xxx currently happen to be the most visited online xxx website The website manages to book an average of xxx

th

• xxx

per month

Online xxx – Market Size & Growth (2012)

M k Si Y Y G th

Major Online xxx Websites – (2012)

W b it R h % 3 thMarket Size Y‐o‐Y Growth Website Reach % ‐ 3 months

Website A 0.0181%

Website AB 0.0357%

Website ABC 0.0458%Website ABC 0.0458%

Website ABCD 0.0550%

Website ABCDE 0.0627%

Website ABCDEF 0.1240%


Website ABCDEFG 0.1915%

SAMPLE e‐Commerce Market India (x/x) – Online xxx Overview –India Statistics (x/x)

Online xxx Demand – India

Demand – North India

d dDemand – East India

Demand – West India

d l diDemand – Central India Demand – South India


SAMPLE Growth in individual disposable incomes is boosting thee‐Commerce market significantly

•Owing to a steady rise in the country’s GDP, the disposable income amongst the Indianpopulation is also showing signs of tremendous improvement

Increased Spending Power Impact

A greater proportion of the overall Indian population now have considerably higher spending power as aresult of which e‐Commerce is gaining mass momentum

• Entry of new players in the market result in a stiff competition and consequently vendors resortto price cuts which in turn further strengthens the purchase power of the Indian population

mn

Total No. of Household (mn) Aggregate Annual Disposable Income

Globals

INR tn

a

b>1000

mn

a

b

c

Per household annual income (INR ‘000)

DeprivedAspirersSeekersStrivers c

d

e

0

Core target consumer

500‐1000

200‐500

90‐200

<90

d

e

f


02025e2015e2005

groups0

2025e2015e2005

SAMPLE …will open doors for e‐Commerce vendors to tap the lurking potential in the nation

Increasing Internet Penetration and PC users (2/2)

mn

Number of Broadband Subscribers – India

a

b

c

d

xxx

0

2015e2014e2013e201220112010

Internet Users Growth – BRIC Nations Sl. No. Country Internet User Base 2011 (mn)

Y‐o‐Y Growth

Population Penetration

hmn

a

b

c

xxx

1 China

2 USA

3 India

4 Russia

India

c

d

0

xxxxxxxxx

ChinaRussiaBrazil

5 Indonesia

6 Mexico

7 Turkey

8 China


xxxxxx World Average

SAMPLE Expenses incurred in online advertising and customer acquisition is on the higher side

Cost per clickMinimum desired

no. of clicksAmount shelled

outImpact

Average cost per click f t th

• Refers to the average li k t h

It refers to the amount d b This amount severelyrefers to the expenses

incurred by e‐Commerce vendors in order to generate one

click from the consumer

click to purchase conversion ration

• On an average 1 out of every 100 clicks gets converted to purchases in India

invested by e‐Commerce vendors in order to facilitate at least one successful

transaction

This amount severely damages the profit

margins, especially when brand loyalty amongst

customers is almost zero in the marketconsumer purchases in India

xxx

• xxx


SAMPLE COD has its own set of pros and cons, however of late it has started taking a heavy toll on the profitability

Losses Incurred for COD Impact• The concept of COD was an immediate success in gaining customer confidence, however itlevied its own set of hurdles on e‐Commerce vendors

• The biggest risk factor associated with COD is the chances of product return, which in turnalleviates the overall expenses beared by vendors

• Consequently, these additional costs add up to the overall expenses of the vendors therebybringing down the profit margins by manifolds

Transaction Split –e‐Commerce India (2012)

xxx

COD Expenses – e‐Commerce Vendor India

45%55%

e‐CommerceVendor

xxx

Customer

xxx COD Charges

xxxyyyProduct ReturnThese costs add up to a

vendor’s expenses for a


single product delivered via COD mode

SAMPLE An example of e‐Commerce ecosystem

Internet Infrastructure

Application Infrastructure

Intermediariese‐Commerce Companies

Ecosystem Layers

Comprises of companies offering basic IT infrastructure and

equipment required for

Comprises of vendors which produce softwares intended to facilitate

Intermediary companies provide a proper and

organized platform for e‐Commerce so as to

Companies which act as the interface for online

sellers as well as Description equipment required for going online in the World

Wide Web

online transactions and other web services

Commerce, so as to facilitate online transactions

prospective buyers fall under this category

ki d b b d d ifiNetworking, Hardware and Software

Manufacturers, IT peripheral vendors, Internet Service

Providers

Web based commerce app, databases, search engine software, online

consultancy and multimedia application

developers

Industry specific companies such as online travel players, financial service providers, web based ad developers and

content provders

Online e‐Tailers, web based media and entertainment

companies, online ticketing companies

Company Type

Providers developers content provders

xxx xxx xxx xxxExamples of Companies


SAMPLE Porter’s Five Forces Analysis

Threat of New Entrants

Impactxxx

Impactxxx

• xxx

Impactxxx Impact

Bargaining Power of Buyers• xxx

xxx

Bargaining Power of Suppliers• xxx

xxx

Competitive Rivalry• xxx

Impactxxx

xxxxxx xxx

Threat of Substitutes• xxx

Impactxxx


SAMPLE Major Public Companies ‐ Summary

3,000

3,500

Net Profit/Loss

Size of the Bubble represents Market Capitalization in INR mn

00

2,000

2,500

38,535.4

500

1,000

1,500

10,604.3

32,747.4

‐500

0 6,530,703.4

‐1,000

‐4,000 ‐2,000 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 22,000 24,000

Total income


Player 4Player 3Player 2Player 1

SAMPLE Public: Foreign Company – Company ABC (x/x)

Company Information Offices and Centres – India

Corporate Address

Tel No.

Fax No.

Website

Year of Incorporation

Products and Services

Ticker Symbol

Stock ExchangeHead Office

Hyderabad

Key People

Products and Services

N D i ti

Category Products/Services

Name Designation


SAMPLE i i l S h K i

Public: Foreign Company – Company ABC (x/x)

Financial Snapshot Key Ratios

Particulars y‐o‐y change (2012‐11)

2012 2011 2010 2009

Profitability RatiosOperating Margin

Net Profit/LossTotal Income

40

60

INR bnINR bn

a

b Net MarginProfit Before Tax MarginReturn on EquityReturn on Capital EmployedReturn on Working CapitalReturn on Assets

‐20

0

20

40b

c

d

0

2012201120102009

Financial Summary • The company incurred a net profit of negative INR xxx bn in FY 2012, as compared to net profit of INR xxx bn in FY 2011

• The company reported total income of INR xxx bn in FY 2012, as compared to INR xxx bn in FY 2011

Return on Fixed Assets

Cost RatiosOperating costs (% of Sales)Administration costs (% of Sales)

Interest costs (% of Sales)to INR xxx bn in FY 2011

• The company earned an operating margin of xxx% in FY 2012, a decrease of xxx percentage points over FY 2011

• The company reported debt to equity ratio of xxx in FY 2012, an increase of xxx% over FY 2011

Interest costs (% of Sales)

Liquidity RatiosCurrent RatioCash Ratio

Leverage RatiosDebt to Equity Ratio

b i l iKey Financial Performance Indicators

Indicators Value (15/03/2013)Market Capitalization (INR mn)

Total Enterprise Value (INR mn)

EPS (USD)

Debt to Capital RatioInterest Coverage Ratio

Efficiency RatiosFixed Asset TurnoverAsset TurnoverCurrent Asset Turnover

16

EPS (USD)

PE Ratio (Abs)Working Capital TurnoverCapital Employed Turnover

Improved Decline

E‐COMMERCE MARKET IN INDIA 2013.PPT

SAMPLE Public: Foreign Company – Company ABC (x/x)

Key Business Segments Key Geographic Segments

xxxxxxOnline Retailers

0%

50%

100%

100%

48% 45% 44% 43%0%

50%

100%

57%56%55%52%

xxx

0%

2012

0%

2012201120102009

Business Highlights (1/2)

Description News


SAMPLE Public: Foreign Company – Company ABC (x/x) – Traffic Statistics (x/x)

Ranks Most Viewed Sub‐Domains

Traffic Statistics – xxx

Global RankGlobal Rank

India RankIndia Rank100.0%

ReachReachxxx

Audience Snapshot Technical Details

Age (Years)Age (Years) Unique Page Views/DayUnique Page Views/Day

GenderGender Search Engine Redirection (%)Search Engine Redirection (%)

Average Load TimeAverage Load Time


Time (mm:ss)Time (mm:ss) Average Load Time (Secs)

Average Load Time (Secs)

SAMPLE Public: Foreign Company – Company ABC (x/x) – SWOT Analysis

• xxx • xxx

S W

TO • xxx• xxx


SAMPLE Consumer Insights: e‐Commerce Segments (1/3)

Segment 6

Segment 3

Segment 5

Segment 2

Segment 4

Segment 1

e‐Commerce Segments – Split (2012) e‐Commerce Segments – Overview

• x

e‐Commerce Consumption – Gender Split (2012)

a

b

100%

xxxxxx

e Commerce Consumption Gender Split (2012)

b

c

d

e

0%


0%

Segment 6Segment 5Segment 4Segment 3Segment 2Segment 1

Thank you for the attentionThe e‐Commerce Market – India 2013 report is a part of Netscribes’ Information Technology Series.For more detailed information or customized research requirements please contact:

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E‐COMMERCE MARKET IN INDIA 2013.PPT

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market research report : e commerce market in india 2013

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