Retail in India, the Evolution is Slow

Annkur P Agarwal
Co-Founder & CEO-PriceBaba
Wednesday, October 2, 2013
Annkur P Agarwal
PriceBaba is a location based search engine provider, helping the real world shoppers to search prices in their vicinity. It has raised an undisclosed amount of seed investment from five investors, led by Pune based angel investor and entrepreneur Karamveer Singh.

Retail in India is diverse and comes in many flavors. Over the last 11 years I have seen a huge variety of retail in India. Be it the unorganized areas of Crawford Market in Mumbai where you can not walk on the street without being pitched to buy something from a road side vendor, Chandni Chowk of Delhi where you would struggle to find place to walk, let alone driving through smoothly and of course the well built and populous malls across the country.

There is a healthy unorganized and local side to retail in India, good presence of International brands and a developing culture of shopping malls. The difference of course is that, unlike the west, organized retail in India is developing in an age when consumer Internet is already mainstream. That possesses unique challenges - a) Online commerce has an equal play in building its market share, and b) Brand building and customer loyalty for physical stores won't develop without distraction from good online stores.

So let's take a look at the hottest topic for retail in India: e-Commerce. Last decade when the likes of Baazee.com started to gain traction, we thought the age of online shopping is here. 10 years later, we are still talking about a promising future for online shopping. In India, there are plenty of levers to online shopping that makes it tricky for the entire industry. Unlike the ticketing industry where the purchase is electronic and consumption is offline, typical online retail requires inventory & warehousing, logistics, after-sales service and for a consumer the ambiguity of buying something without the touch and feel of real shops. Payments is another issue that has been largely tackled by Cash on Delivery, but we also know with online ticketing that given enough value, consumers in India will find a way to pay for it.

There is real opportunity for online retail in India and at the same time there are very real challenges too. The industry is growing, but with all the hoopla about online retail we should not forget that even in the next 10 years, it would only do a very small fraction of the over $700 billion retail industry.

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