The exploded adoption of the internet by businesses can be well understood with the fact that 329.3 million domains names across all top-level domains (TLDs) were registered by the end of 2016. However, if we include all the sub-domains and micro sites currently active on the internet, count skyrockets to remarkably high 1.81 billion by April 2017.
These figures clearly indicate to a radical shift in the way people do business – complete digitisation of business processes.
The scenario in India is no different. The exploded adoption of Internet and booming e-commerce conditions have convinced businesses owners in the country to set up their digital shop to pursue addictive online shoppers.
Despite many encouraging success stories of online stores and entrepreneurs, individual business owners are still shying away to look beyond marketplaces likes of Flipkart, Amazon India and Snapdeal. The number of individual eStores is very low as compare to other digitally developed markets.
This has led up to few burning questions:
- Is the much-hyped Indian e-commerce story is really leading us into the right direction of sustainable growth?
- Is Marketplace a safe bet for individual sellers or small scale business owners?
- Amid to the billion dollars war chests, every marketplace is building, how do individuals and mid-scale retailers could survive on the internet?
- Are traditional business owners ready to embrace the new style of business operations?
- How difficult or easy is it to convince traditional retailers to make an investment required to take their business online?
With above questions, and many more, we approached Jasminder Singh Gulati, Co-founder & CEO of NowFloats – one of the fastest growing location-based disruptive technology providers for online discovery, that helps businesses get discovered on the Internet.
The core objective of our interaction was to understand the fast changing scenario of online business, and challenges offline retailers face while onboarding the internet.
Q: In India, as the adoption of the internet is exploding, do you see the similar trends with businesses going online as well?
It has become increasingly apparent to businesses that their customers are now looking for information online. Even though many businesses claim that they cannot “compete with offers” on the internet, we must remember that our urban definition of “e-commerce” is limited to the purchase of lifestyle products. Whereas there are plenty of small business owners who sell everything from cow milking machines to hearing aids online. Whether or not the actual ‘sale’ happens online, they have certainly gained the attention and trust of new customers. As SMBs become more conscious of the advantages of taking their business online (websites, emails, social media page, etc.) it will in turn drive adoption of websites. According to a Zinnov report on the ‘State of the Domain Name Industry in India,’ the services & manufacturing are key verticals buying domain names to establish its online presence.
Q: What are some of the biggest concerns for businesses while onboarding the internet?
For small businesses, the most basic concern is the balancing act between having enough working capital and making predictable returns on investment. No matter how negligible the cost may be, it is important that their efforts are not futile.
Q: At the time of deep discounting and online festivals seasons offered by marketplaces and commerce sites, how comfortable business owners are to float self-owned competitive shopping platform, or they are willing to float a simple representation of their business on the internet?
BCG, along with Facebook, have produced a report that predicts about 130 million online shoppers by the year 2020, purchasing fashion alone. At that point, deep discounting will not be a sustainable model. Besides this, there will be enough space for all online participants, without having to fight for the limited market-share (<50 million) we have today. Regardless of the aesthetics of their website, small businesses have a bigger gain by establishing trust and visibility within their target market, for which an online presence is essential.
Once again, the ‘deep discounting’ view is agnostic to the majority of the 51 million SMEs that are currently operational in India, and it would be rather peculiar for the consumer to seek discounts on (for example) construction materials or surgical equipment.
Q: Are business owners willing to spend on the development of custom built CMS (Content and Catalog Management Solution) or popular CMS engines are the taste of the town? In the case of the latter one, which are the most preferred CMS platforms among business owners?
There are various business solutions available for SMEs today. With NowFloats, we have proven that SMEs are willing to pay a price of INR 25,000 per year (~ USD 400), provided that the solution gives them the ROI they need. For highly competitive markets like Real Estate, inorganic discovery is crucial, and also requires a bigger monetary push. For businesses that deal in very small ticket sizes, the cost of a custom-CMS solution might just be too high, so they may prefer an online aggregator or a more generic solution such as a Facebook page.
For the vast majority of businesses that lie in between, they’re able to spend a few lakh rupees per year on their marketing activities (which largely includes digital as well), and their ROI is also not a point of concern given the average value of a sale they make. With only a little more than 700,000 SMEs in India having their own website, it would be too presumptuous to make a generalisation. The Indian SME space is unstructured and myriad, and a service provider’s primary task is to keep an ear to the ground and collect feedback, detect patterns, and disrupt for problems that only a market like India can have.
Q: Of those who invest in Google SEO, what is the average investment these businesses are willing to make in Google?
Very niche products and services don’t require as big a push for discovery. Among the rest, ROI and competitiveness in their vertical are still driving factors for “how much” investment is made. If indeed, there is a one-size-fits-all solution, it would be a system wherein any small business owner can have their own floating point on the internet that can be easily modified in terms of adding content (which caters to organic SEO and subsequent discovery), without any external dependencies and heavy costs such as a web development/SEO/Digital marketing agency.
Q: Google vs Facebook: Which is the best online lead/sales generation platform for business owners in India?
Wherever their customers a looking. Only the business owner knows where their target market is, and if the democracy of an online space is to be maintained, solutions must only aid discovery (even beyond search). What if there could be a seamless way of being visible on both platforms, without making an extra effort for the same exercise? There is no harm in that.
NowFloats, a location-based disruptive technology for online discovery, that helps businesses get discovered, has registered impressive growth in the Delhi/NCR region. The innovative platform has grown to more than 38,000 live customers in the past 3 years and is playing a pivotal role in boosting and enabling SMBs across a wider spectrum using its innovative technology.
The above interview is a part of D’Dialog series. The objective of the series is to interact with the industry leaders in a bid to understand upcoming market shifts, customers’ behaviour and identity underlying challenges in clocking high growth rate. You can find more enthralling interactions by following our D’Dialogue section.