Tuesday, June 16, 2009


Internet Retailing or ‘e-retailing’ (less frequently also known as e-tailing) is basically an online shopping retail store using different technologies or media. It may be broadly be a combination of two elements.

» Combining new technologies with elements of traditional stores and direct mail models
» Using new technologies to replace elements of store or direct mail retail.

Internet retail also has some elements in common with direct mail retailing. For eg, e-mail messages can replace mail messages and the telephone, that are used in the direct mail model as means of providing information, communication and transactions while on-line catalogues can replace printed catalogues. As with direct mail businesses, critical success factors include:
• Use of customer databases
• Easy ordering
• Quick Delivery

Operational elements that the Internet retail model shares with both the retail store and direct mail model includes:
» Billing of customers
» Relationships with suppliers

There are, therefore, many elements that Internet retail and more traditional retail models have in common. Indeed many of the most successful Internet retailers have been those that have been able to successfully transfer critical elements from traditional retailing to the Internet, such as customer service and product displays.

                                                                  Click on the image for enlarged view

Facts and Figures:

E-tailing accounts is about 10 per cent of the overall e-commerce market. According to the Internet and Mobile Association of India (IAMAI) and Indian Marketing Research Bureau (IMRB) report, the e-tailing market was worth Rs 850 crore in 2006-2007 and it is expected to grow by 30 per cent, touching Rs 1,105 crore in 2007-2008. Globally, the market for online shopping has increased by 40 per cent in the last two years, according to the latest Nielsen Global Online Survey on Internet shopping habits.

As a matter of fact, industry body Assocham has pointed out that the volume of products sold online are expected to grow by 150 per cent in 2008. Additionally, the increasing PC and Internet penetration is helping accelerate the share of e-commerce in India.

Advantages of E-tailing

* Sheer convenience.
* Wider choice.
* Better value.
* Unique gifting opportunity.
* Saves time and strain.
* Integrated source of information.
* Micro targeting.
* Mass personalization.
* Know customer preferences.
* No Real Estate Cost

E-Tailing Business Models

* Virtual Merchant
* Clicks & Mortar.
* Catalog Merchant.
* Online Malls.
* Manufacture Direct

Channel Comparison with Traditional Retailing Practices

                                                                  Click on the image to see a clear view

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