55% of Indians look for discounts before shopping online

BANGALORE, India - Nov. 6, 2014 - PRLog -- The journey of digital media from 2 million users to 250 million users has been quite evolutionary and the biggest beneficiary of advertising spends today in 2014 is digital advertising, which is expected to grow by 35 per cent over last year at INR  3,402 Crores.

It might be interesting to know that 20% of the digital ad spend was attributed to eCommerce. Online spend on eCommerce was estimated at INR 495 Crores as of March 2014.

Remarketing has been touted as one of the most sophisticated algorithms to have come across in digital marketing in a long, long time, something that flipped the entire idea of marketing and instead of trying to bring the consumers to the products, it took the products to the consumers. It has changed the entire concept of marketing, from the ‘who’ to the ‘what’.

However, there seems to be just one little problem though, the consumers did not find the idea sophisticated enough. In fact, consumers have a very different idea of the entire effort being put in for remarketing. Some think they are “being haunted”, some call it “being followed”, “an invasion to their privacy”, “desperation” on the part of the sellers or even “useless”.

To help understand this dichotomy, DMTI undertook a study among a projectable sample of consumers which was focused on addressing the habits and preferences of online shoppers.

Shoppers from across India were included in the study. An online survey was used to collect the data and interviews were conducted to probe deeper into the perceptions and trends in online and offline shopping among the TG.  The respondents were mainly students or employed in the private sector and from across the four metro cities of Mumbai, Delhi, Kolkata and Chennai

A recent study conducted by IAMAI-IMRB suggested that India’s E-commerce market will reach $56 billion by 2023, driven by rising online retail. However, compared to such staggering figures, India’s e-commerce industry is still in a nascent stage. Online shopping accounts for less than one percent of the total shopping in the country. And the biggest drivers of online purchase, as it seems, are the deals and discounts. As per our analysis, 55% and 61% of the respondents look for online discounts and deals respectively. Second on the list is the convenience that online shopping has to offer.

Also, when people adopted online shopping for the purchase of electronic goods, it was because of the deals, discounts and bargains. The respondents expressed that if the price is no lesser online, they would prefer to go buy it in a store.

And then there are categories that have still not picked up with the quintessential Indian consumers, categories like groceries, jewellery, furniture and International food Items.

Online jewellery retail too is poised to be one of the fastest growing segments in India's e-commerce market which is projected to become an $8 billion industry in the next two years. However, the consumers still do not seem too interested in buying these things online, be it vegetables or diamonds.

The current share of online sales in the $50 billion domestic jewellery market is a minuscule 0.5% and the consumers seem not only uninterested but averse to the idea of online purchase of gold and diamonds.

Almost 42% and 44% of the respondents remember being “followed” by ads based on their last search and last purchase respectively.

Many of the respondents, in the course of the interviews had said that online is the new destination for window shopping. They spend quite a considerable amount of time looking for items, adding them to the cart and either getting a better deal somewhere else or abandoning the cart altogether. And then, “these items start following us everywhere”.

“Sometimes it’s good to be reminded, but then shouldn’t my search behaviour tell them if I had any intension to purchase at all?” asks Prashant, a 32 years old entrepreneur from Hyderabad.

Remarketing looks to be blindly following the consumer with the products they had searched for, even once, and following them everywhere, be it with travel tickets on a news site, or apparels on an online book store. As the consumers say, their search behaviour too should be accounted for. How many times has a product been searched for is definitely a factor worth looking into. And maybe, the relevance of the landing page with respect to the products in the ad is something that needs more attention.

India has been known to be a “Can’t feel, won’t buy” nation. But the growth numbers of the online shopping industry does say otherwise.

The Indian consumers, though in far smaller numbers as compared to their global counterparts, are adopting this channel for purchases big and small.

Just around 12 percent of Indian population is into online transactions against more than half of their Chinese counterparts. This proportion is much higher in the developed countries like the US, where the figure is 64 percent.

Established brands may take on this opportunity and increase their online footprint.

Consumers are more confident buying brands they have bought and used before and brands can leverage on this familiarity to do away with the “touch and feel” constraint, especially for products priced on the higher side.

Remarketing ads give you access to a whole bunch of user data that needs to be used to provide relevant and enticing ads to the end user based on their stage of the buying cycle. Simply sending them back to your homepage is a waste of your marketing dollars or for that matter showing them images of the products they just bought.