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Some of the other important factors that
facilitated the growth of online shopping was the increase
in number of broadband Internet connections (1.3 million
broadband subscribers as on March 31, 2006),6
the growing purchasing power of the middle class, limited
personal time, increased use of credit and debit cards, and
more importantly a large young population that spent a
considerable amount of time online.
Analysts felt that there was also a shift in the attitude of
people, who were now more receptive to the experience of
online shopping. Customers were increasingly becoming aware
of the advantages of online shopping such as the opportunity
to compare the features and price of various product brands,
read consumer reviews, and make the purchase decision at a
leisurely pace. |
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Some experts said that a key hurdle for the growth of online retailing was
the issue of credit card fraud. They felt that these retail portals had to
gain customer confidence with respect to transparency in money transactions.
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The consumers also had to be made aware of other
payment options. Gautam Thakar, Country Manager, eBay India said,
"There is a misconception that to trade online you need a credit
card, however the fact is buyers can opt for Cash-on-Delivery and cheque
or demand draft facility as the mode of payment."
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Another major challenge was to gain customer confidence on the
authenticity of goods bought online. These companies had to put in
extra effort to convince customers to purchase the product as they
could not feel or take a trial before purchase. Some of the other
challenges for online retailers were assessment of online customer
behavior, managing the supply chain and logistics in order to avoid
delays, making up for the ambient shopping experience in physical
formats, establishing brand recall, establishing consistency in
pricing across channels, and managing purchase returns. |
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