The Next Steps

In the FY '07, business worth Rs 7,080 crore was made by the Indian
businessmen over the Internet, as per a recent market research firm IMRB. And,
this year, that research predicts, the volume would go up to Rs 9,210 crore.

You would all agree, I am sure, that the consumer e-commerce is picking up.
For instance, today I am booking all my train and flight tickets, and paying
phone bills almost always on the Internet. And, some of my tech-savvy colleagues
in office are paying utility bills, buying movie tickets, and doing some bank
transactions online. There are many other things that are being bought and sold
on-line now.

Has e-commerce arrived? Yes, and no. Some of these things mentioned above
have been there for sometime. However, their usage is not going beyond those who
own a PC or a laptop, or have some access to the Internet. And, in many smaller
places, even if you have a PC and Internet access, there are not too many
opportunities to do on-line shopping.

There are going to be several big challenges for consumer e-commerce to
really take off in India. For the success and popularity of consumer e-commerce,
IT and telecom penetration will be one big factor. Even in metros, PC
penetration is very poor. Broadband, which will be one of the biggest enablers
of Internet-based commerce, is more or less not there. The government, with the
help of the private sector and some innovative thinking will have to get this
part of infrastructure in place.

One great thing that can really push e-commerce to altogether new domains and
directions, is mobile phones. Unfortunately, there are not too many e-commerce
applications available today on mobile platforms. There needs to be some
incentive, offered jointly by the government and the industry for solution
providers to work on mobile and e-commerce solutions.

Beyond trying to motivate the stakeholders to promote e-commerce, there
should also be a push approach. For instance, the government could make it
mandatory, that certain utility bills like phone and electricity in India's top
10 cities should be paid only online. This would be a push approach to begin
with to touch millions of people. Many of these people come from small towns and
would talk about this experience when they go back. Many would come from very
poor section of the society, who do not own a PC or have ever used ITeS, but
would experience it for the first time by paying bills though kiosks or other
outlets created for this. If they have a good experience, there would be so many
more supporters of IT among the have-nots. In the long run, they will become the
evangelists of e-commerce in the levels still untouched by the IT.

The other big challenge to the growth of e-commerce will be consumer rights.
Today, most Indian shoppers are more comfortable with a look and feel option
when they purchase a music system or a piece of furniture. One reason for this
is also their lack of faith in the quality of product they finally get.
Therefore, unless they are very sure that in case of a problem they have a very
strong and dependable grievance redressal system in place, they would be highly
wary of the e-commerce route. The role of the government will again be quite
important here.

Ibrahim Ahmad

ibrahima@cybermedia.co.in