Common.in

For purchasing online there are several advantages as well as disadvantages of COD as a payment method
Advantages
1.low risk for the buyer, they pay only if / when the item is delivered.
2. The seller bears the risk, as some of the buyers may not be serious and may refuse to pay when the item is delivered.

Disadvantages
1. Difficult to track the transaction at a later date.
2. Some online stores charge an additional fee for COD , as courier companies charge a collection fee and this is passed on to the customers.
3. Many coupons / discounts are not available for COD transactions.

An opportunity which many online stores miss out, is the stocking of ethnic clothes and related products.
This problem has become worse in the last few years, with increased surveillance and a decrease in the number of shops stocking Indian clothes. Many online stores in India stock an extremely limited range of ethnic clothes . One of the largest retailers in India has a very well designed store with a large variety of ethnic clothes, but the quality control for the product shipped could be improved. A customer may tolerate a poor quality product once or twice , but will not want to waste his or her money again shopping at the store again. They should also clearly indicated whether the clothes need to be dry cleaned or not, it affects the purchase decision.

The other overlooked aspect is that many stores stocking ethnic clothes do not indicate the size/dimensions of the clothes clearly. Most stores have clothes from different suppliers, and each supplier has different dimensions for small, medium, large sizes, the lengths. Returning clothes or any product ordered online can be very time consuming. The small and medium sizes are suitable for people in their teens and twenties, while most college students today usually prefer to wear western clothes. Most buyers of ethnic clothes are usually in their mid thirties and would prefer larger sizes.

Starting an online retailing business involves a substantial investment in stocks, logistics and other material. Also, the margins are not very high and many online stores reach the break even point only after a few years. So though online shopping is very convenient for consumers, a company or person starting the online store has to do a thorough analysis of the market conditions in the internet industry before taking a decision.

Not every investor is willing to bear losses for several months or years before breaking even. If you only bank on your hard work and merit, it is important that the market offers a level playing field. Most online stores advertise on other websites using ad networks and your experience as an online publisher is a good indication of the business ethics of these companies. While many may differ, sometimes working with companies which treat all their business partners fairly, is more important that earning a lot of money.

If you have a large offline business, starting an online store selling the same products does not entail much additional investment in stocks, so it can be a viable option. However, if you do not have any background in selling physical products, the investment in finding suppliers, storage and delivery systems can be substantial and a business will invest only if they are convinced of the long term prospects.

In metro cities it is easy to purchase products of different brands, but in small towns many of these products are just not available. Most retailers will stock products of only two or three brands on their store shelves. The retailers do not stock a specific brand of product for a number of reasons like:
1. Low demand
2. Low margins
3. Poor after sales service/ support
4. ideological reasons – don’t approve of the business tactics adopted by the company

Products from some of the largest companies in the country are “out of stock” or “not stocked”. This is an opportunity for online sellers, who can purchase these items at wholesale rates and ship to buyers in small towns and villages. These buyers are often willing to pay a premium for a product which they need , but is not available locally. Logistics can be a problem while shipping to remote places, but some couriers and the speed post / registered post network covers most towns and villages in the country. However, online sellers should also remember that supplying quality products and providing good customer support is important for getting repeat buyers.

While it is convenient to place an order online, it is sometimes difficult to co-ordinate delivery of the product ordered due to factors beyond your control. The courier / delivery person can deliver the product at any time of the day. Ordering magazines online is more convenient than most other products, since most magazines are sent by ordinary post and the recipient need not sign an acknowledgement. The cost of each magazine copy is usually less than Rs 100.

Many magazines offer an online subscription option on their website, but if you wish to subscribe to a number of magazines, signing up at each website can be a very cumbersome process as you have to enter all personal details like name, email, telephone number separately . There are some online aggregators like Infibeam, Pustak and Magazinemall which allow you to order a number of magazines using a single account. Processing of the subscription usually takes two to four weeks, after which you start receiving magazine copies. Many of the magazines which can be ordered online have a limited circulation and are not easily available at most newspaper stalls.

Of the monthly magazines subscribed for some time, Consumer Voice, Alive and Caravan have been delivered regularly on time. Tehelka magazines which is published weekly also has a very efficient delivery system, but the delivery mechanism of some other weekly current affairs magazines could be improved, as many copies are missing.

Some of the reasons why online shopping has become popular in India are:
1.the entire transaction is recorded. Since the specifications, discounts and payments are documented, the seller cannot make false allegations against the buyer.
2.convenient home delivery.

An article on this trend.

http://business-standard.com/india/news/watch-out-retail-giants-online-majors-aim-for-sky/458867/

The conversion rate at a website depends to some extent on the user interface. A well funded startup selling conventional products, can use any of the shopping carts available, but if the billing method is different, a team of programmers are needed for developing a suitable website.
Finding a good programmer can be a difficult task, especially if you do not have a programming background or a large budget. A lot of testing is required to remove any bugs before the new interface can be used, which is time consuming. The checkout process is comparatively difficult to debug as payments have to be made. A new startup may not be able to afford this, but this can affect sales and customer experience.

If a defective product leaves the company’s premises, rectifying the error at a later date is expensive for the company as it usually involves a lot of adverse publicity as well as expensive returns. So it is important for an e-commerce company to have proper quality control systems, to ensure that the product shipped does not contain any defects and there is no damage or pilferage by couriers during transit.
In the short term, shipping a faulty item may help get rid of inventory, but in the long term, it can be very expensive. The cost of customer acquisition, some one who spends a few thousand rupees annually is often more than Rs 2000 . Finding a high paying/ spending customer is much more difficult. So if the company fails to ensure that proper checks are in place, they may lose a customer for life and directly affect their future growth.

One of the factors determining the conversion rate of an e-commerce website is the user interface. If the website is easy to use and the customer can find the product he or she wants quickly, a visit is more likely to convert into a sale. On the other hand, if the user has to spend a lot of time, searching the various options, they may decide to postpone placing the order.

Unlike computer and other hardware products, the user interface design can be a major factor for a buyer purchasing clothes and accessories. Most online stores offer a number of variations in clothes like colours available and sizes. So a buyer has to use the drop down menu to check whether his or her preferred size and colour are available. If these are not in stock, the buyer has to check the other options available. There are many fashion websites which regularly conduct sales, and only limited numbers of a particular item are available. If the website is designed with a drop down menu to check the availability of different sizes of a particular product, just finding which items are available can be very time consuming. Though it may involve some amount of programming, eliminating these minor irritants can greatly boost sales.

At times, when you buy a product online and it is defective / not working as expected, the online store will compensate you by offering the following:
1. Refund – with no compensation for the inconvenience you have faced while ordering the item
2. Gift voucher – you are obliged to spend an equivalent amount at the store, despite having an unpleasant shopping experience
3. Replacement

The unlucky buyer has to spend time and money returning the item, and if the timelines / procedure for refund are not clear, it is better to keep the defective item and try to get it repaired locally.