Mark Fox, President & CEO of Novator gave data from the US, spoke about the growing influence of the web in making purchase decisions (referrals, source of data), and put forth a strong case for offline retailers to move online, lest they lose marketshare in the coming years. He also spoke about using social networks for retailing giving the example of music being sold to users of MySpace. The mobile phone will emerge as an additional mode of placing orders. He senses a change among offline retailers in the last three months – they’re looking to go online, and 2007 is the year when it will happen. Small jewelry retailers are also going online. He ran out of time before he could dwell on how virtual worlds could be used for assisting offline purchases.
Vivek Nayak, COO of Avenues India gave the India specific story of how 85 percent of online retailers are pure play Internet merchants, and bricks and mortar retailers are yet to move online. Naming a few brands, he pointed out the lack of an e-retailing strategy and said that one of the reasons is because they’re not fully aware of what technology and the internet can enable for them – open a new channel of communication that is direct, interactive and cheap (really?) to run, integrate online and offline customer information and make CRM more effective.
Virender Ahluwalia, CEO of Fobaz.com spoke about how online and offline business models are similar, and the internet is just another channel, and hence the principles of doing business offline can be extrapolated to online businesses as well.
Sandeep Murthy, CEO of Cleartrip.com said that the size of the online travel market in India is still relatively small, and travel is on industry where there is a channel shift – offline agents are losing business to online. Online, they’ve able to offer customers several choices as opposed to offline, where giving the same choices would take more time and never be as comprehensive. The challenge, though, is in the margins – air travel still gives the lowest margins. Sanjeev Bikhchandani, CEO of Info Edge Ltd, who chaired this session, added that railways is a monopoly, and buying tickets offline is so problematic that the IRCTC website does extremely well.
During the Q&A, I asked Sandeep Murthy and Sanjeev Bikhchandani about how they view aggregators – whether they are a threat or do they contribute to their business? Murthy said that aggergators give them more traffic, and might even get more traffic than online portals, but they don’t offer the customers a complete solution. Bikhchandani said that aggregators offer very little traffic to them – they give their listings to rediff, Indiatimes and bixee, and get minimal traffic from them. Someone asked about managing fraud, giving the recent developments regarding Kingfisher as an example. Mark Fox said that fraud is different across different sectors – apparels are worst hit. Other solutions mentioned were direct payment solutions from banks and the benefits of fraud management solutions.
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