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Ecommerce in India – 2016’s Online Shopping Destination

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Shopping in Chennai, India

Ecommerce in India is looking pretty so far, but 99% of the canvas is still unpainted. The country’s online retail sales currently account for less than 1% of the total revenue generated by retail sales. However, it would be inaccurate to label India’s e-commerce state as ‘infantile’, for the industry has seen growth — fast and furious — over the past few years. For example, India’s online retail market share nearly doubled from 10% in 2009 to 18% in 2013. With the gears well-oiled to continue turning at this robust rate, key e-commerce players are forecast to run on exponential growth for the next five years.

With reference to a recent study by TechSci Research, India’s e-commerce market is predicted to grow at a compound annual growth rate (CAGR) of over 36% between 2015 and 2020. A combination of many important determinants work together in producing this figure. Internet and mobile penetration is at an all-time high and growing stronger by the day. With cheaper internet and mobile data plans being churned out, the feverish bug of online retail is spreading beyond Tier 1 consumers, but also to the Tier 2 and 3 consumers in India. Accessibility and awareness work hand in hand to contribute toward heightened interest in online shopping. Foreign Direct Investments and aggressive funding in both retail startups and giants are also major factors in stoking the fire. In the next half-decade, Taiwanese electronics maker Foxconn Technology Group will pour 5 billion USD of commerce investments into India.

On the consumers’ side, aggressive marketing and attractive discounts on spending are incentivising them to open their wallets. The big boys of India’s online retail — Flipkart, Snapdeal and Shopclues — compete for market share by keeping their prices low and competitive. Cashback sites have also caught on in recent years and proved to be a popular channel for consumers to make their purchases. These cashback sites monetise by providing rebates for consumers on their spending and purchases.

Top Online Shopping Sites in India

Just this year, Southeast Asia-based cashback startup ShopBack launched in India. With a strong pulse already felt in Singapore, Malaysia, and the Philippines, ShopBack opened strong in India as well, offering customised cashback options for key Indian merchants like Jabong, MakeMyTrip and Amazon.in. Co-founder Joel Leong said, ‘We recognise that Indians are heavy users of mobile recharge, so we want to help them save money by paying them extra cashback for an indispensable necessity.’

As of Q2 of 2015, a study by the Telecom Regulatory Authority of India revealed that mobile subscribership clocks in at almost one billion Indians. Recognising the savings prospects this entails for mobile users, ShopBack made its Indian debut providing 5% cashback for mobile recharge and bill payment with Paytm. To put that in perspective, the current market rate is only at 1.9%.

What obstacles must be demolished?

From arid dry deserts to sweeping mountain ranges, the Indian subcontinent is flush with beautiful panoramas. However, this varied landscape — coupled with insufficient suitable infrastructure — incubates a disorientating headache for retailers seeking economical logistics and transport systems. The developing country’s business-to-consumer e-tail platform is thriving, but specific to this department, the delivery fees for sending a single parcel from one end of the country to the other can be steep, making them unpopular with buyers and cost-inefficient for sellers. Currently, logistics systems in India are metropolitan-centric and target mostly Tier 1 consumers. About 90% of goods purchased online are delivered by air, layering added costs for retailers. Surveys have shown that Indian consumers expect low-cost, if not no cost, where shipping and returning charges are involved.

Indian Rupee

Another hurdle to cross for India’s e-commerce growth also happens to be their most favoured payment method: cash-on-delivery. Although manpower-intensive and time-consuming for retailers, the system accounts for more than 80% of e-tail transactions in India. The vibrant cash economy is supported by a majority of consumers who prefer inspecting the goods to match expectations before counting out the banknotes. This purchasing behaviour means returns and non-payments are high, and efforts and delivery costs come to naught for retailers. Plagued by low credit card ownership amongst the overall population, it seems this arrangement is set to continue, at least in the near future. However, the preference for COD also stems from a distrust in the lack of delivery and transit structures. Investments are already laying on the foundation for these problems, and key players are also introducing online payment wallets and enticing credit card payment options. The e-tail industry holds huge promise for expansion should these issues be alleviated.

What is brewing in the future?

India has a potential consumer base which far outsizes those of many other countries in the world. Currently, a flourishing travel market accounts for more than half of the total e-commerce market. Ticket-purchase, hotel-reservations, and holiday-planning are increasingly being completed online, and this trend shows no signs of slowing down.

Agra India Taj Mahal

2015 was a remarkable year for India’s e-commerce, booming from 5 billion USD to 8 billion USD. Although there is no question of it continuing to permeate consumers’ lives in 2016, India’s e-commerce seems to be paving another route of growth. Out of at least 75 million predicted e-tail consumers this year, more transactions are likely to go through mobile phones than computers. India is opening its doors wider to international firms by the day and with accelerating capital flows bolstering economic liberation, the drumbeat of India’s e-commerce is looking to resonate stronger than ever.

Callum Connects

Cassiopea Yap, Founder of Ashleigh Ivory

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Cassiopea Yap founded Ashleigh Ivory a health and skincare business in 2007.

What’s your story?
Ashleigh Ivory is a key business venture that I began way back in 2007. Since it has been 10 years, some may be inclined to think that we have a whole repertoire of fine skincare items.

This is not the case. In fact, we don’t have a plethora of products because I’m a bit of a perfectionist. Instead of common focus on the finished item, my journey begins from the backend. This is where products undergo QC, stringent tests and personal use to determine if First Impressions Last Forever.

A product may be subject to 600 tests in three years before being released to purveyors and consumers.

What excites you most about your industry?
The Health and Skincare aspects of it. I am excited even though the industry is filled to the brim with products and solutions, a fact that challenged me to come up with something totally new.
The result? Ashleigh Ivory’s Black Diamond Beauty Roller and Fuji Shiitake Age-Defying Serum set.

What’s your connection to Asia?
Asia is dynamic and happening. What is more, in several countries, there is a niche for bespoke, handcrafted and anti-ageing products and services. Hence, my connection to Asia and within Asia lies in my travels to various countries in search of these special items.

One example is how I found my sensei in Japan, and the result is my Made in Japan Roller in combination with the Fuji Shiitake Age-Dying Serum. The specially formulated Serum has eight amino acids as well as a high content of Vitamin C. It is also rich in Kojic acid that helps in brightening skin, fading pigmentation and reducing acne scars.

Favourite city in Asia for business and why?
I love Singapore. Because the infrastructure of the city supports the employment of reliable staff for a personalised, face-to-face shopping experience.What is more, technology thrives in Singapore so this supports our omni-channel shopping experience as well, whether it is for B2C or B2B business models.

What’s the best piece of advice you ever received?
We need not pursue beauty under the knife.

Who inspires you?
Princess Diana. Like she said: “People think that, at the end of the day, a man is the only answer.”

To me, a fulfilling business is better for me and yes, I am going to own it myself and be true to myself. I no longer want to live someone else’s idea or life. I just want to build my own legacy before I leave this Planet Earth for my next generation to come.”

What have you just learnt recently that blew you away?
Lip Service Providers out there who lie without blinking when offering their services.

If you had your time again, what would you do differently?
Not marry my present husband.

How do you unwind?
By listening to music. Music sets the tone right in the hustle and bustle of city-dwelling. I wouldn’t say no to a glass of wine or chocolates either.

Favourite Asian destination for relaxation? Why?
It’d have to be Japan. I love the scenery, and how the Japanese respect aesthetics indoors as well as outdoors. Even with functional items, they tend to make them beautiful as well. I love their onsen too, with great hygiene practices and rejuvenating soaks in hot springs. Guess this is a way to unwind too.

Everyone in business should read this book:
God is my CEO, Following God’s Principles in a Bottom-line World by Larry S Julian. It contains real-life accounts of business leaders and other people in authority. When reading these real stories about how ‘Rome was not built in a day,’ I can fully empathise with how important work takes time.

Shameless plug for your business:
Don’t get addicted to my Black Diamond Beauty Roller & Fuji Shiitake Age-Defying Serum set because its effects are so so good. In a way, this is true, because you’ll only need to use it twice a day, 5-10 minutes each time.
Alright, I succumb. You can use it three times a day.
Ashleigh Ivory’s Black Diamond Beauty Roller and Fuji Shiitake Age-Defying Serum set. We can all apply well concocted creams and serums on our skin, but how do we maximise its penetration?
The Black Diamond Beauty Roller is designed to penetrate deep into skin, acting directly on the cell level for optimum results.
Each Roller is handcrafted from terahertz ore in a diamond cut of 48 facets to reduce crow’s feet, diminish fine lines, tightenpores and lots more.

How can people connect with you?
I am just a text or phone call away

This interview is part of the ‘Callum Connect’ series of more than 500 interviews

Callum Laing is an entrepreneur and investor based in Singapore. He has previously started, built and sold half a dozen businesses and is now a Partner at Unity-Group Private Equity and Co-Founder of The Marketing Group PLC. He is the author two best selling books ‘Progressive Partnerships’ and ‘Agglomerate’.

Connect with Callum here:
twitter.com/laingcallum
linkedin.com/in/callumlaing
Download free copies of his books here: www.callumlaing.com

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Entrepreneurship

Women on Top in Tech – Laina Raveendran Greene, Co-Founder at Angels of Impact

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(Women on Top in Tech is a series about Women Founders, CEOs, and Leaders in technology. It aims to amplify and bring to the fore diversity in leadership in technology.)

Here is our interview with Laina Raveendran Greene, Founder of GETIT Inc. and Co-Founder of Angels of Impact, an impact network focused on women social entrepreneurs helping to alleviate poverty. She is an entrepreneur and social impact investor, whose passion is female empowerment, and enabling women to be key agents to help alleviate poverty in Asia.

What makes you do what you do?
As a minority female Singaporean from relatively humble beginnings, I have never taken anything for granted. I learnt early on that I have to work doubly hard to overcome the “glass ceilings” but if I persevere, I can succeed. That is why I chose to focus on helping women-led social enterprises as I know how hard things are for them and I hope to make things a little easier for them.

How did you rise in the industry you are in? 
I rose by being courageous enough to push against the “glass ceiling” and seizing opportunities open to me no matter where they were. Early on, I realized I would have better opportunities overseas, so I worked in many countries, including Switzerland, USA, and Indonesia and used these opportunities to learn and open new avenues for myself. I now come back to Singapore with many more networks and skill sets.

Why did you take on this role/start this startup especially since this is perhaps a stretch or challenge for you (or viewed as one since you are not the usual leadership demographics)?
Yes, as a minority Singaporean, it may appear that I am not the usual leadership demography in Singapore. In my own way, however, I think I have amassed my own international accolades and work experience such as serving as the first Secretary General for the Asia Pacific Internet Association, CEO of one of the first few tech startups in Singapore in the early 90s, being on the International Steering Committee of the Global Telecommunication Women Network, and most recently selected as one of the 2nd cohort of Edmond Hillary Fellows in New Zealand.

I am now moving to the next phase of using these networks and skills to help other women to social enterprises, which seem to be exactly what I want to do in my next phase of life (after more than 25 years of global work experience).

Do you have a mentor that you look up to in your industries or did you look for one or how did that work? 
It was harder in my younger days, as one of the few women in tech to find mentors but today I do.  Men were reluctant to mentor me for fear of rumors.

How did you make a match if you did, and how did you end up being mentored by him? 
I found my mentor when I was taking an executive program at Stanford. He was one of the keynote speakers and I went to talk to him. Intrigued by my background, when I asked if he would mentor me, he said yes. I meet with him at regular intervals and I always ensure I have put his ideas to test before reporting back to him. I feel that I value his time if I do actually listen and act on his advice.

Now as a leader how do you spot, develop, keep, grow and support your talent? 
The key qualities I look for is an eagerness to learn and humility to be open to new ideas. Also, when asked to be a mentor, I usually give homework and see how proactive they are. Only the ones who do their homework, take the advice and act on it, are the ones I actively mentor.

Do you consciously or unconsciously support diversity and why?
I consciously and unconsciously support diversity, as I see the importance of diversity on true innovation. You never get anything new, talking to like-minded people. It is always good to have different perspectives to create new ideas. I am also an active supporter having faced racial and gender discrimination in my life and want to ensure that others are given a better chance.

What is your take on what it takes to be a great leader in your industry and as a general rule of thumb? 
A great leader to me is one who has empathy and humility, and a genuine spirit of service. Today’s challenges such as climate change and social injustice, requires many players to apply their knowledge and skills to solve and have a sense of ownership in solving these issues

Advice for others?
The only advice I can think of is do what you are strongly passionate about. You need to persevere to succeed so it helps if you truly care about the endeavor you are working on.

If you’d like to get in touch with Laina Raveendran Greene, please feel free to reach out to her on LinkedIn: https://www.linkedin.com/in/laina/

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