EcomRishab

From working in the fast-paced E-Commerce industry in the mornings to solving aptitude problems at night, and now making it to one of India’s top B-Schools.
I have realised that learning has no limits, no age, specially when driven by passion.

Learn. Grow. Execute.

Amazon has HIKED seller commission in 🇮🇳

Sellers will now be paying higher commissions across categories - apparels, beauty, groceries & medicines etc. — go up by 7-8%+

Why? – Amazon is looking to conserve cash amidst a global slowdown + 🇮🇳e-commerce market grew by 69.4%+ in FY22 – So it’s the right time for them to ‘cash in’.

How will this affect users + sellers? 🤔

• Increase in cost of the seller commission will be passed on to users => shopping on Amazon may become a costly affair

• Reduction in seller margins + forced to maintain a low RTO rate (return to origin), as the product return fee has been hiked as well  (up to 40% in some cases!)

• Increase in shipping rates by 20-23%

• Increase in seller fee for over-the-counter medicines 
-5.5% to 12% for products ≤ Rs 500
-15% for items priced >Rs 500.

Can brands give an Amazon-like experience to customers, without paying such hefty commissions?

Time will tell this, but surely more inclination towards building D2C / QuickCom presence.

Is eCommerce in India plateaued?
Where will the next wave of growth come from? 🤔
A short breakdown 👇🏼

Blume Ventures published it's comprehensive Indus Valley Report 2023 last week. We used some starting points on eCommerce growths and unpeeled them further 🎯

Urban India has 55% eCommerce HH pe*******on while Rural India sits at 19% (Source: Blume Report). So will the next wave of eCommerce growth come from Rural India?

Not quite. Adoption does not follow headroom only but a typical S curve. It starts slowly in the initial stages, accelerates with critical mass and slows down again as it scales and matures 📈

The insight behind this is that the rate of users adopting a behaviour increases as more and more people around them do the same. It triggers word of mouth and aspiration esp for newer and cooler formats which eCommerce certainly is 💬

Share of wallet or Spends always follows usage. Users start using a product/ service (HH pe*******on). Once they like it and start using it frequently, their share of wallet follows (Spends) 💰

The eCommerce share of Non-food is 20% (Source: Blume Report). We assume around 25% share of spends in Urban and an 8% share of spends in Rural. Which means that from a spends perspective, Urban India should be in the "Accelerated growth" stage 🚀

This means that the 55% (and growing) Urban HHs will shift more and more of their spends to eCommerce. This would come from an increase in order frequency and trying out categories that they haven't bought online e.g. they might be buying Apparel but not Beauty 🛍️

While Rural might add equal or more HHs to eCommerce pe*******on in coming years, we estimate that 75% of the eCommerce value delta will be driven out of Urban markets 💰

Stay tuned for more such content on E-Commerce.