E-commerce (electronic commerce or EC) is the buying and selling of goods and services, or the transmitting of funds or data, over an electronic network, primarily the Internet. Getting into e-commerce is a great way to start your own business, especially if you don’t have a lot of money to invest in startup costs. There are multiple ways to do business online, including selling your own products, creating an affiliate site that has a functional store, drop shipping for a merchant or starting an information publishing business.
As of quarter one 2015, six Indian Startup companies Flipkart, Snapdeal, InMobi, Quikr, OlaCabs, and Paytm (One97) have managed to enter the Billion-Dollar club. The number of people online in India is forecast to touch 302 million by the end of this year, overtaking the US as the second-largest Internet market in the world. According to a report by the Internet and Mobile Association of India (IAMAI) and IMRB International, the number of Internet users in India is expected to grow 32 per cent to 302 million this year from 213 million at the end of December last year. The Internet user base in the country is further estimated to grow to 354 million by June 2015.
In an interview on Indian e-commerce startups, Mr. Ratan Tata has said that “India is a big country with a tremendous appetite for computer-based or Internet-based services. It is a nascent industry and I have chosen to support it.” In the recent months, Tata has invested in at least five companies linked to the digital economy and these include Snapdeal, CarDekho, Urban Ladder, Bluestone and most recently Paytm.
Venture capitalists (VC) and private equity players have demonstrated their faith in the growth of e-Commerce in the country. Many venture capital firms such as Accel Partners, Tiger Global, Kalaari capital, Nexus Venture Partners, Helion Ventures have invested considerably.
Some recent e-commerce investments are: Flipkart Ltd is in advanced talks to raise $600-800 million in fresh capital by existing investors, including US-based hedge fund Tiger Global Management and Qatar Investment Authority. Entertainment ticketing website BookMyShow.com raised Rs.100 crores investment by Accel Partners. Last year SoftBank Internet and Media, Inc. committed $627 million funding in Snapdeal. Snapdeal has also collected $133 million funding led by eBay, Kalaari Capital, Nexus Venture Partners, Bessemer Venture Partners, Intel Capital and Saama Capital. Myntra.com has secured $50 million investment led by Premji Invest along with Accel Partners and Tiger Global. In September 2014 Bigbasket.com snapped up $33 million from Helion Ventures, Ascent Capital, Zodius Capital and Lionrock Capital. In January 2014 Urbanladder closed $21 million funding from Steadview Capital along with the existing investors SAIF Partners and Kalaari Capital. In February 2014 Jabong.com secured $27.5 million from British development finance institution CDC. Firstcry.com received $15 million funding from Vertex Venture Management. Limeroad raised $15 million investment from Tiger Global, including existing investors, Lightspeed Venture Partners and Matrix Partners, India. Pepperfry raised $15 million funding led by Bertelsmann India Investments (BII), including Norwest Venture Partners (NVP). In June 2014 Fashionandyou secured $10 million from its existing partners — Sequoia Capital, Smile Group, Norwest Venture Partners, Intel Capital and Nokia Growth Partners.
Online Indian ethnic wear store Cbazaar received funding of Rs. 30 crore to Rs 50 crore from private equity firm Forum Synergies. PrettySecrets pulled off $2 million by Rehan Yar Khan of Orios Venture Partners and co-invested by India Quotient along with participation from prominent angel investors like Anupam Mittal and Ravi Gururaj. Happilyunmarried secured $0.65 million from InfoEdge.
E-Commerce or Electronics Commerce business models can generally be categorized in different categories like Business – to – Business (B2B), Business – to – Consumer (B2C), Consumer – to – Consumer (C2C), Consumer – to – Business (C2B), Business – to – Government (B2G), Government – to – Business (G2B), Government – to – Citizen (G2C)
Some of the main aspects of the e-commerce value proposition include: Discounted pricing, Speed of delivery, Security and convenience of payment, Quality of service. E-Commerce sites use electronic payment where electronic payment refers to paperless monetary transactions. Security is an essential part of any transaction that takes place over the internet.
Secure Electronic Transaction– It is a secure protocol developed by MasterCard and Visa in collaboration. It has following components −
Card Holder’s Digital Wallet Software − Digital Wallet allows card holder to make secure purchases online via point and click interface.
Merchant Software − This software helps merchants to communicate with potential customers and financial institutions in secure manner.
Payment Gateway Server Software − Payment gateway provides automatic and standard payment process. It supports the process for merchant’s certificate request.
Certificate Authority Software − This software is used by financial institutions to issue digital certificates to cardholders and merchants and to enable them to register their account agreements for secure electronic commerce.
Types of e- commerce licensing models:
On-premise e-commerce- On-premise e-commerce software usually requires initial one time purchase investment in terms of licensing fees. Also it implies extra costs related to hardware and installation services as well as data migration and on-going maintenance fees that are usually charged on a yearly basis for software updates and support. Some examples of typical on-premise E-commerce platforms are Hybris, Intershop Communications, Sana Commerce, Oorjit and IBM WebSphere.
Software as a service (SaaS)- Software as a Service (SaaS) is a cloud based delivery model in which applications are hosted and managed in a service provider’s datacenter, paid for on a subscription basis and accessed via a browser over an internet connection. Two examples of typical SaaS E-commerce solutions are Shopify and Demandware.
Open source E-commerce- Open source e-Commerce is a free of charge platform that doesn’t imply licenses fee. Furthermore, open source users are also responsible for installing, maintaining, securing and configuring the software on their own servers. In order to set up an open source platform, basic technical expertise is required in the areas of web design and development. Software products that are distributed as open source are generally free, and users can access and modify the source code. Three examples of typical open source E-commerce platforms are PayCart,PrestaShop and osCommerce, Magento and Thelia.
There could be various methods of ecommerce marketing such as blog, forums, search engines and some online advertising sites like Google adwords and Adroll. India has got its own version Cyber Monday known as Great Online Shopping Festival which started in December 2012, when Google India partnered with e-commerce companies including Flipkart, HomeShop18, Snapdeal, Indiatimes shopping and Makemytrip.
In the last five years there is a good growth in the e-commerce startup sector in India. Due to factors like low cost initial investment and global reach it is considered as one of the most preferred option for startups in India. E-commerce requires smart business strategy and good amount of patience, in the lack of which even some good e-commerce ideas failed to survive, would like to share some of these here…
Shubhamilana.com- Shubhamilana was a Matrimonial Site.
Pirate’s Kitchen- Pirate’s kitchen was a theme based find dine restaurant.
SASLAB Technologies – This start-up was in the field of Information Security Services and Products.
BlogTard.com – Startup used to set up a blogging network for enterprises.
HashTag -The start-up provided a Crowd sourcing platform for start-ups to validate their idea/ products.
Blahdiary – Aggregated interesting content on politics, social life, branding and copyediting projects.
Follow up manager – This venture created a CRM product to increase sales/support performance for SME’s through timely follow ups.
Academic Ventures – They helped institutes in India to commercialize their technology.
Benarasisarees.com- It was an E-Commerce portal of handloom products from the Looms of Varanasi.
Virtuplus- It was an ecommerce website for niche goods.
FTW- It was a website which used to sell sunglasses of various types like wooden or sarcastic messages written on them.
Oravel Stays (pivot to OYO Rooms) – The company served as a Marketplace for Bed and breakfast.
Discountbull.com – Online e-commerce for showing discount on clothes.
TechBloggerz -The company used to deliver online technology news.
Uncafe.in– Social networking kind of portal which used to make portfolios of users.
Opus Content Solution- The website used to provide content for websites and SEO providers.
MSN Advertisers- The company was working in the domain of Printing /Flex banner/ visting cards/ paper printing etc.
Late night food -The company was a late night food delivery service started with outsources food, bouquet and every essential item which one may need in night.
Visify Books -It was a company which provided Video Cliff Notes for Business Books.
bonafidesoftwares pvt ltd -It was a software product company working on software product dental software and school ERP software.