Advertising was much easier 30 years ago, when the trifecta of TV, radio and newspaper were enough to promote your brand among your customers. But times have changed, and how! The marketing game has shifted its paradigms drastically in the past few years, from social media presence to native advertising. The development is mass media technology and that in psychology have together impacted advertising so that it has become as confusing and overwhelming a field as any other in today’s time.
It is obvious how giants like Flipkart and Amazon are bleeding money when it comes to advertising. In fact, Flipkart posted a loss of Rs. 2000 crore in the previous fiscal year, owing to the ongoing discount war between online retail giants. The fact the online retail companies are ready to suffer massive losses in the process of making their brand more and more visible is very telling. For online sellers, it should highlight the importance of visibility in the competitive market. At the same time, we do not advise you to run at a loss so that you can feed your marketing budget. Instead, we are going to give you a few innovative branding ideas that both you and your customers would enjoy. Here are a few things you need to do.
Branding for Online Retail Sellers
1. Recognise Your Customer Base
Before we even get into the specifics of which product you are selling, we must realise that as an online seller, your customer base is people who have access to the internet. Only 34.8% of the population in India has internet access, but this population generally resides in tier 1 to 3 cities. It is good if you can do a demographic analysis of your customer base – what age group do they belong to, are your customers mostly male or female, what time are they expected to be online, etc. This is valuable data for your organisation. The idea is to build an image of your customer – where would they live, what would they wear, what would they buy apart from your product, etc. Now you are ready for the next step.
2. Sharpen Your Social Media Game (Or Hire an Expert)
If you haven’t already, you should subscribe to a social media management tool like HootSuite, which allows you to access all your social media accounts from one dashboard and provides insightful analysis of the data that it collects in the process. If you post images of your product on social media, please make sure that you post attractive, good quality images. Promote your pages, share them with friends, but don’t spam. It would be great if you could promote your product on a 3rd party website – this will earn you a lot of brownie points. Show your customers that you are always available on social media and try to make it into your primary channel of communication.
3. Involve Your Customer in the Process
A key difference between a dead social media page and an active one is the interaction. A thriving social media account is always active, but the activity comes from both sides – just regularly posting content doesn’t do much. Start a conversation with your customer. Ask them how they like your product if they want something to change. Involve them in online discounts, events, competitions, etc. Let them get to know the brand.
4. Make Your Customer Your Brand Ambassador
You can see this on Instagram all the time. The best advertisement you are ever going to get is your customer promoting your product. Find a creative way to incite your customer to proclaim on social media that they bought your product and love it. For example, the online clothing store Black Milk has built an enviable brand presence by involving their customers and letting them tell their stories. The brand owners actively encourage their customers to share images while wearing Black Milk apparel, with appropriate hashtags to seal the deal.
Not just that, but they invite customers to send their images and upload them on the official Black Milk social media accounts. Just type #blackmilkclothing next time you are on Instagram and see for yourself. With over 920,000 followers on Instagram and 650,000 followers on Facebook, maybe we should take their marketing strategies a little more seriously.
This is what we have on involving customers in your branding process.
US-based online marketplace,Amazonis confident in its Indian venture. So much so, it haspumped Rs.1,680 crorein its India unit. The etailer also launched asixth fulfilment centrein Mumbai for smooth online retail. To improve its ecommerce services, the etailer is looking to modify its payments facility. It will soon be moving to the Unified Payments Interface (UPI) channel for all purchases made on its platform,revealedAP Hota, the CEO and MD of National Payments Corporation of India (NPCI).
Hesaid,“The development is on, but they have not announced the date as yet. Once they come in, UPI acceptance would happen.”
Who else is/ maybe using UPI?
Flipkartshoppers make payments throughPhonePethe UPI app. Approximately, 40% of all UPI transactions by volume come via PhonePe.
Bharat Interface for Money (BHIM) referrals are to be given a reward of Rs.25 from Rs.10. At the moment, once three payments are completed by a person via the BHIM app, he receives a cashback of Rs.25. Referrers, on the other hand, earn Rs.10.
Currently, there are 16-17 non-bank wallets that allow UPI payments. The UPI app was introduced in August 2016. Since then the payment volumes through this app have risen from 0.3 million in November to 10.2 million in June. This increase in volumes is a result of the buzz around the BHIM app launch in December, which happens to contribute to around 45%of UPI transactions.
NPCI spoke with the Reserve Bank of India (RBI) about initiating UPI transactions for Google India.
Hotamentioned,“I understand that the RBI has had a first round of meetings with banks to understand what Google is trying to do.”Thenadded,“I believe the discussions are very positive”
There maybe multiple banks involved because of Google’s magnitude. But, at the moment ecommerce platforms and fintech players are teaming up with a single bank.
The NPCI aims to bring down the charges for Immediate Payment Service (IMPS) for transactions less than Rs.1,000 to 25 paise from 50 paise. This is subject to banks waving interchange on online transactions through e-wallets.
Hotasaid,“The idea is to make all such transactions free.”
Ecommerce firm Amazon announced opening of its new customer service facility in Noida. This is Amazon’s first customer service centre in North India and fifth in India.
“The new customer service site will support Amazon’s India as well as global customers round the clock, with pre and post order customer service through various mediums like email, chat and phone. The sites will also host teams that provide support to Amazon India’s operations in the form of training, workflow etc,” Amazon said in a statement.
The facilities will help create employment for hundreds of customer service personnel in the northern region, it added.
Amazon has two customer service facilities in Hyderabad, one each in Pune Coimbatore.
The intense rivalry betweenAmazonandFlipkarthas seeped into product categories as opposed to the overall marketplace supremacy. The etailers are fighting for dominance in each segments and business verticals.
Flipkart believes that they lead in the smartphones segment
Mobile phones are the most popular items on online marketplaces and amajor chunk of Flipkart’s salescomes from the sale of smartphones. During its anniversary special Big 10 sale,Flipkart fulfilledmobile phone orders worth Rs. 800 – Rs. 1000 crore. On day one, the ecommerce biggie sold over 7 lakh smartphones!
As a result, Flipkart maintains thatthey are the category leaderas far as smartphones are concerned. The etailer stated that nearly 27-28% of the market is in their hands. And they plan to increase their share by launching exclusive handsets.
The marketplace’s senior director and head of mobile phones Ayyappan Raverred,
“Smartphones is one of the biggest category for us and we will continue our focus on this. In July alone, we have launched three exclusive models on the platform including Motorola, Panasonic and Samsung.”
Accordingto market research firm Counterpoint, Flipkart accounted for 57% of the online smartphone sales during January-March quarter, whereas Amazon had 27%.
Amazon witnesses growth in watches category
Flipkart has smartphones in its kitty. But Amazon is looking to lead in another ‘smart’ category. The US-based ecommerce giant recently announced that theirwatches category is growingat jet speed. Smart-watches are flying off the digital shelf as customers are splurging on premium brands without restraint.
Key insights shared by Amazon are:
The watch category has grown by 160% in 2017
Year-on-year (YoY) growth is 200%
Premium watches are selling better than non-premium brands
Top premium brands are growing by an impressive 250% and above, including brands like Emporio Armani, Skagen, Fossil, Citizen & Casio
Metallic watches like Gunmetal and Titanium are gaining the most momentum in premium watches
Demand for smart watches from fashion brands is increasing at a rapid pace
Bengaluru contributes the most to the sale of premium watches on Amazon, followed by Delhi and Mumbai
“We have built a strong foothold in the fashion smart-watches category by launching smart-watch brands like Fossil Q, Michael Kors Access etc. This has helped us increase our selection by over 5x YOY giving customers across tier-2 & tier-3 cities easy access to Fashion smart-watches.”
The PWA by Flipkart is a normal webpage that acts in a manner similar to the Flipkart mobile app. It offers features like:
Single click sign in
‘Add to home screen’ option
The etailer’s mobile website is just 100KB to download. This is 100 times smaller than its Android app of 10MB and 300 times small than its iOS app. Plus, repeat visits use up only 10KB.
How does this help Flipkart?
With its light PWA, Flipkart can tap potential customers in tier II and III cities where slow network connectivity and low phone memory are not unusual.
Amar Nagaram, vice-president, engineering, Flipkart,said,“This (web app) results in very low data consumption and subsequent page loads for repeat visits happen in less than one second, even on 2G and 3G networks or lower-end devices. Around 60% of visitors to Flipkart’s mobile web had uninstalled the app earlier, primarily due to lack of device storage space.”
From tier II and III cities Flipkart receives about 1/3 of total visits on mobile web. Around 60% purchases are made from these cities through mobile internet. And, approximately 50% of new customers are acquired from these areas through this mobile internet channel.
The making of the PWA
Back in April 2015, Flipkart took down its mobile website. By July, the team was working with Google Chrome on specifications for its PWA – Flipkart Lite.
Arindam Mukherjee, the senior director of product, user experience and growth at Flipkartsaid,“The earlier version (was more) from an experience point of view.
We were not doing justice to our customers. Internet penetration was rising in India, which made us think how we could build a better user experience on mobile browsers. We had a (native) app and we were doing good work there, but the question was, could we bring it (mobile app) on par?
It was (first) only with Chrome but we wanted to get to other browsers too.”
Nagarammentionedthat,“Our development philosophy is changing. We do not have an Android team, iOS team, web team.One core team will be at the centre of everything. Whatever we have on app, we are trying to bring it online. We are exploring if we can take payments offline. Can we enable offline shopping? We are hopeful.”
He also stated that the team assisted Myntra, Ola and Zoomcar with their PWA mobile web versions.
Do you think this will help the etailer get on track to profits?
When you’re lost in the effort to scale up in ecommerce and rake in the right profits, you often forget small things like warehouse management and efficiency. This could be a dreadful mistake because a small task like this is a lynchpin your business cannot afford to ignore. Inefficient warehousing can lead to shipping mistakes. But, warehousing with an effective plan can lead to timely dispatch, less damage, low returns and no out of stock situations.
How do you increase the efficiency of your warehouse?
#1 – Allot specific locations for your products
Assigning locations for your products will help you know where to find the items you need. This reduces time spent in putting away stock when it arrives and processing orders once received.
Keep small items together to avoid losing them.
Place old inventory at the front of shelves/ racks or at the top of stacks.
Store fast moving goods at the front of your storage facility/ room.
Store heavier and slow moving goods at the back of your storage facility/ room.
Group similar goods together.
“Optimise labour efficiency: Analyse your material usage patterns, and store high-volume items together near the front of the warehouse to eliminate travel time. Also, the store items that are frequently sold together near one another. Basically, you will streamline operations if you try to keep the items you pick most often in the most accessible locations,”pointed Shashank Tarun, senior strategic account manager at Browntape, the Multi-channel order and inventory management firm.
#2 – Conduct quality checks (QC)
Quality checks are essential for delivery of intact and safe goods to customers. Checking up on your goods in storage can help you avoid the sale of contaminated, broken or substandard goods.
To ensure the integrity and quality of your goods have your QC station set up before your product packaging station.
#3 – Track what comes in and goes out
To ensure you always know how many products you have in stock (even when at your marketplaces’ warehouses), it best to use an automated system to keep track. This will prevent issues like under/over stocking goods. This is especially the case when products have different demand on multiple marketplaces and the problem of returns arises. Tracking your inventory will also prevent customer dissatisfaction.
Tarun, said that, “Be tech-friendly: A strong WMS module* can improve efficiency by suggesting the best routes and methods for picking or put-away. In addition, the system provides automated pick lists that can be sent to mobile readers and devices to help eliminate mistakes and reduce wasted time and paper.”
WMS module* = warehouse management system is a software application that assists with effective warehouse and distribution management.
#4 – Review products regularly
Make it a regular practice to review your products. This review will involve the checking of sales details. Which are the products that sell quickest and slowest and when this happens (in case of season stocks)? You can accordingly determine stock quantities required and capable of fitting within your facility, based on the seasonal reviews.
Tarun mentioned, “Maintain Lean Inventory/Adopting lean inventory: stocking only what is needed, and nothing more. Possibly reduce or eliminate safety stocks, and try to get suppliers to deliver smaller quantities more frequently.”
#5 – Note peak and slack patterns
Hiring extra staff is an expense and insufficient staff is again an expense as it will impact your SLA with marketplaces if you cannot process orders in time. Identify the peak periods for your goods and make appropriate arrangements to meet the demand. Also, ensure you maintain sufficient staff when restocking goods to prevent things from lying around out of place.
Make a calendar so you can plan your staff requirements according to the sales you will be participating in.
#6 – Store only the packaging you need
Purchasing packaging that you don’t need is a waste of money and space. So, determine the kind of packaging material you need and maintain enough to match the quantity of goods in stock. Try to cut down the size of packing material too. It will help you save valuable resources.
Measure your products down to size to know just how much of packaging material you need. Based on this calculate the amount of packaging you will need if stocks increase or decrease.
Purchase less packaging for the goods that are not in season.
#7 – Select a strategic warehouse location
Try to pick a location that’s easy for marketplace courier persons to reach. If that’s not possible, try to keep your stocks at warehousing facilities in appropriate locations or shops that you can team with for a certain fee.
Hire persons to come pick up stocks too, from the stores/ shops you partner with if possible.
This is our list of warehouse efficiency tips. What pointers does yours include? Tell us through your comments below.
Back in September 2016 when the AskMe fiasco was its peak, online sellers had met Commerce and Industry Minister Nirmala Sitharaman to discuss AskmeBazaar’s pending payment issues. The meeting gave them hope that the ministry would finally look into vendors’ problems.
But the Commerce Ministry’s recent responses to the questions raised in Rajya Sabha related to marketplace payment settlement troubles have left sellers disappointed, according to All India Online Vendors Association (AIOVA).
Q & A raised in Rajya Sabha
AIOVA shared with Indian Online Seller the questions asked by Rajya Sabha Members TG Venkatesh and Kapil Sibal related to the demands made by seller lobby groups and the Ministry’s answers. Below is an excerpt:
About setting up a regulatory body for ecommerce
Ans.: The Government time-to-time receives suggestions/views from various stakeholders and public including online vendors on various aspects of FDI regime. These are examined and thereafter suitable action is taken by the Government. However, no decision has been taken by the Government for setting up a regulator for ecommerce.
On AIOVA and other ecommerce sellers approaching the Government for payment default by ecommerce players
Ans.: The Government has received communications from All India Online Vendors Association and others raising issues relating to ecommerce including payment settlement. The issues raised by the Associations regarding payment settlement emanated from disputes arising out of business operations of the entities involved. The Government takes action under suitable laws/statutes in such issues routed through appropriate authorities.
AIOVA miffed with the Ministry calling payment settlement issues as ‘business disputes’
It is the second answer (mentioned above) that has rattled sellers. AIOVA called the statement on business disputes as factually incorrect and listed out cases of AskMe, and BestDeal TV. The association also stated that:
There is no third party verification of sellers settlements, due to which business disputes arise in non defaulting parties
There is no importance being given to our demand for a regulatory body for ecommerce marketplaces
DIPP guidelines are being violated by Amazon and Flipkart, which we have raised to the Ministry and RBI, however, Ministry is letting those violations continue
AIOVA’s spokesperson said in its statement,
“The Minister should understand that the said companies are ecommerce marketplaces who have collected money from consumers on sellers’ behalf and not reimbursed to sellers. The Minister had met the representatives of our association in 2016 and had assured to look into our problems; however, there is no headway into the same… Our Association has sent multiple emails, letters, grievances and RTI to the commerce ministry.”
“The ministry is scooting our issue and treating issues related to Amazon, Flipkart, Snapdeal as issues of FDI and asking us to talk to RBI. For non FDI matters, we are being asked to talk to consumer ministry. We even met the consumer affairs ministry earlier this year, the concerned officials shared with us that they are waiting for Commerce Ministry to take this issue further.We seek intervention of a higher authority to save the ecommerce sellers of India who are responsible for millions of jobs and crores of revenue to the Indian economy,” added the representative.
Online sellers want the government to treat sellers’ issues as a separate subject and not club it with consumer issues. They also want that instead of giving standard responses, the Ministry should pay close attention to what vendors have been trying to communicate. All seller issues shouldn’t be construed as issues related to FDI policy, AIOVA requests.
In spite ofcost cuttingto make profits,Flipkartis still calling full steam ahead when it comes togrowth plans. India’s number one online marketplace introducedprivate labelsto its platform recently and believes they will be their ride to profitability. In fact, by the end of this fiscal, the etailer expects private brands to spread across a wide variety of its product categories.
Plan for Private Labels
By December 2017, Flipkart will move from 3 private brands across 36 categories to 7 private brands across 80 categories. And, this should contribute of approximately 10% of the etailer’s revenue,mentionedAdarsh Menon, VP and head – Private Labels at Flipkart. At the end of the fiscal 5 more categories will be added to the list.
Hesaid,“The private labels would contribute 10% of units etailed on our platform and contribute as much to our revenues.”
Since 6 months ago, Flipkart launched private labels under categories:
Small home appliances and audio
This has intrigued online shoppers to a substantial extent and now the etailer is looking to move to furniture, fashion apparel and fashion accessories, Menonclaimed.
Arch rival,Amazon India launched private labelson its platform too, with similar profitability expectations as Flipkart. But, for the latter, there are other things in the oven as well.
Focus remains on big tickets
Apart from private label expansion, Flipkart will continue to concentrate on large appliances it appears. The ecommerce company announced it will have a new warehouse in Ahmedabad that will solely be for large appliance – a top focus category. The new storage facility will ensure customer needs and expectations are met in terms of minimal lag in delivery and fulfilment of orders for large appliances from Flipkart.