Indian Scenario

2

Online Travel

• India’s travel industry was pegged at over USD 2.8 Bn (Rs. 140 bn) by end of March 2010, comprising of Tour Operators, Railways, Hotels and other such entities.

• The online travel industry size currently is about 25% amounting to USD 700 mn by year 2010.

• Top 5 players: MakeMyTrip, Cleartrip, Yatra, Travelguru,IRCTC

• The current growth rate of India’s online travel industry is 45%. The operating margins of most online travel operators are about 8-12%. Makemytrip had a successful IPO in July2010

• The current growth rate of India’s online travel industry is 45%. The operating margins of most

online travel operators are about 8-12%• Growth is driven by Indian professionals

traveling within India and abroad,

Company Revenues

Make My Trip

US 83.56 mn

Travel Guru US 4 mn

ClearTrip US 9.6 mn

Yatra US 15.6 mn

IRCTC US 34mn

3

Online Matrimony

Online matrimony segment is driven by 2 main factors:1) Arranged Marriages is still a norm in India2) Online matrimony provides a much larger

database of grooms/brides unlike local match makers.

Dominated by 4 key players:63 million by 2010-11( Empower research 2010)

Shaadi.com – is the leader with maximum visitortraffic in FY 2010.Revenues (USD 18 mn)Jeevansathi.com – is second in terms of uniquevisitor traffic in the same year however, it is theleader in terms of page-views (133 million) ascompared to Shaadi (75 million). (USD 14 mn)Bharatmatrimony.com – is number 3 in terms ofunique visitors but it is also experiencing a declinein traffic like Shaadi.com (USD 10 mn)Indiamatrimony.com with over 1 million profilesis a significant player. (USD 4 mn)Simplymarry.com, LifepartnerIndia.com,Indiabestmatch.com, vivahabandhan.com,shubhlagan.in are some of the other upcoming sites.

Company Revenues

Shaadi.com 18 mn

JeevanSathi.com

14mn

Bharatmatrimony.com

10 mn

Indiamatrimony.com

4mn

4

Online Jobs

USD 0.5 bn (1000 cr market) Dominated by a few big players such as:

Naukri.com – leader with over 10 million unique visitors during FY 2008.

Monster.com – 2nd website in terms of visitor traffic with around 6.5 million unique visitors in fiscal 2010.

Timesjobs.com – fastest growing recorded a 40% jump in visitor traffic during FY 2010.

Clickjobs.com- Fourth largest with 2 mn unique visitors

Driven by: Strong growth in India’s Services sector, IT/ITES/ boom. (Naukri is part of infoedge, monster is not listed in India , Times jobs is part of Times of India group. Individual revenue numbers are not available directly)

5

Online Real Estate

Indiaproperty.com– maximum number of unique visitors in FY 2010 (65 mn ) unique visitors,150 mn page views

99acres.com – is number two in terms of visitor traffic but leads in terms of page-views.58 mn unique visitors, 180 mn page views

Magicbricks.com – 45 mn unique visitors,120 mn page views

Makaan.com – 35 mn unique visitors,102 mn page views

Driven by: Strong growth in India’s Services sector, IT/ITES/ boom, real estate boom in boom towns. (99acres is part of infoedge. )

6

B2B biz Networks/Directories

Free and cost-effective online applications are available for all typical business processes ofSMEs. Revenue Model: Bulk Purchase orders and Product search listing. Registered with more than 40,000 product listings and 10,000 vendors

Top 3 leading b2b networks are:• IndiaMART.com: Biggest B2B Market

place. Comprehensive directory of all major B2B players with the contact details.

• Tradeindia.com: Second largest B2B Market place. Registered with more than 25,000 product listings and 8,000 vendors

• BizXchange.in: Third largest B2B Market place. Registered with more than 20,000 product listings and 6,000 vendors

7

Online Retail Portals

Mark

Driven by India’s increasing internet and credit card penetration. Provide a wider reach and even cover tier2 and tier 3 cities. Primarily cater to professional working class and youth. Top 5 players are:IndiaPlaza: Revenues of US$ 12mn in 2010 ( to be confirmed). Claims to have the largest collection of books and gift items

Infibeam: Launched India’s first ereader. Major source of revenue from books though they started out a shopping site across all categories

Rediff Shopping: Overall rediff revenues in March 2010 USD 18.84 mn. Claim that 25% revenues come from shopping (to be verified)

eGully India: Online retailer across all categories (launched in 2008). Revenues of 4 crores.

Naaptol India: Online retailer across all categories (launched in 2007). Expected Revenues of 3.5 crores in 2010

8

Online books

Mark

Sachin Bansal,CEO FlipKart India:Market size of whole of book industry in India isestimated at 6000 crores and is growing at a very quick pace. Market size for online book shopping in India is expected to be between Rs. 70 crore for 2010 and growing at a healthy rate 50-60% Year on Year ( to be verified). It is driven by growing middle class, better internet access andhigher comfort of Indians with online shoppingTop 5 players (Based on Alexa rankings) are:

FlipKart: Aims to be Amazon of India. Posted revenue of Rs 5 crore in 2008-09 and its site attracts 5 million visitors a month. In 2009, they grew to 8 crores with 8.5-9 mn visitors.Bookshopindia: Claim to be second largerst book store. In 2009, they claim to post revenues of 3 crores with 4.5 mn visitors.IndiaPlaza: Largest shopping portal of India. Claim to have the biggest collection of books (8 lakh titles )Indiatimes shopping: Largest information portal of India. Claim to get over 30% of total revenues by books (to be verified)

9

Online Gifts

Driven by India’s increasing internet and credit card penetration. India’s corporate gifts market is over US$ 1.2 billion with online gifting constituting 1% of overall share (Source: Business India news, Jan 2010)Top 5 players (Based on Alexa rankings) are:

India Gifts Portal:Claim to have the largest market share (20%) of Corporate gifting market. Expected Revenues of over 20 crores in 2010 (to be confirmed)

GiftsIndia.com:Expected revenues of 6-7 crores in 2010. claim to be the second largest player

IndiaPlaza:

Indiatimes shopping:

Rediff Shopping:

10

Online Shoes

India’s online footmarket is estimated to be 800 cr+ (Business world April 2009). Online shoe selling constitutes only 1% of the total market. Driven by increasing internet and credit card penetration

BigShoeBazaar: Claim to be Largest online authorized shoe store in South Asia. Claim Revenues of 8.5 crores in 2009 (to be confirmed)

IndiFootwear: Claim Revenues of 4.5 crores in 2009 and seem to have highest number of unique visitors in their category (requires confirmation) Playgroundonline: Cater to sports and outdoor apparel market. Likely to do 1.3 crores this year

11

Online Kids shopping

India’s online baby care is estimated to be 1000 cr+ (Business India Dec 2009). Online segment constitutes less than 3% of the total market. Driven by increasing internet and credit card penetration

BabyIndia: Claim to be fastest growing online babycare store in India. Expected revenues 4 crores 2010 (to be confirmed).

Shopmania: Claim to derive largest share of revenues from baby care segment (40% ).Revenues for 2010: 2.8-3 crores KidStudtio: Expected revenues of 1.5 crores in 2010

12

Payment Gateways

Problem area: Low credit card penetration, also online payment is unreliable making ecommerce difficult. online fraud and accountbreaches are the biggest barriers to eCommerce. Online shoppers are apprehensive and unwilling to provide their credit card and bank details (Business world survey June 2008)

Payment gateways provide a solution. Leading Payment gateways:

CCAvenue: Biggest payment gateway provider in India. Revenues: 280 crores (March 2009).Tie-ups with all leading banks, 30,000 merchants. Part of Avenues group with multiple online business interests( Events, Online travel servicesEBS-Payments:online payments system offers payment options; credit cards, prepaid cards and online bank transfer. neonePay: Offer

Pay Seal (from ICICI Bank)

Axis Payment Gateway:

13

Customer Online Billing solutions

Problem area: Enable individuals/customers to pay bills online.Top two players:1) BillDesk: Direct relationship model. One time.

Authentication of credit card/debit card. Small Fee for every transaction. Investors: SIDBI ventures

2) Bill Junction (Tech Process Solutions Ltd):Use Electronic Clearing Services where the customer specifies the amount to be debited in his account for every bill generated. Flat Subscription fee for users. Even allow Enterprise and Corporate Bill payment. Investors : ICICI Ventures, GreyLock Ventures

3) Timesofmoney.com: Allow bill payment through credit card/debit card services. Service product: “DirectPay”. Subscription based model for users.

4) Easy2Pay: electronic bill presentation and payment (EBPP) service. It enables the user to view, store and pay the bills. It is India’s first real-time EBPP service provider that offers multiple bill payment modes. It only charges a one-time fee and no annual charges. It has some big Corporate firms asits clientele.

14

mPayments

Problem area: PC and Internet on PC penetration in India is low but mobile penetration is high. For mCommerce to succeed, mobile payments platform should be successful.

Recent regulation by RBI :

Leading Mobile payment providers:

1) mChek: Signed up with all leading telcos, banks, ticket providers, insurance companies. Enable bill payments, ticket purchases. One time credit card authentications setup. Investors: DFJ

2) Paymate: Like mChek, allows users to link mobile phone with a credit card, bank account. Tie ups with mobile phone operators, banks but smaller coverage

3) Obopay India: Part of Obopay group,California. Partnered with Nokia for mobile payment platform. Revenues less than $1mn.

4) ATOM Tech: Part of Financial Technologies India group. Providing a mobile app which includes a credit card on mobile. Any payment requires a password authentication.

15

Challenges with order fulfillments: Logistics

Problem area: Order Fulfillment is an important part of ecommerce Value chain. Most ecommerce providers use a combination of their own logistics teams and also tie-ups with leading local logistics.

Based on Interviews, the following leading names in logistics names were revealed:

1. DTDC logistics (part of DHL ,all India presence)2. Gati (Maharashtra, Karnataka) 3. BlueDart (part of DHL ,all India presence)4. VRL Logistics (Karnataka)5. Aramex logistics (Maharashtra, Karnataka)6. Vichare courier( Maharashtra)

Most of these provide tracking services for customers and people are willing to pay a premium for proper delivery.

16

Ecommerce Software/Solution Providers

Many front-end ecommerce portals use ecommerce solution/platform providers for their services. Advantage is that these eCommerce solution providers have proven expertise and the front-end companies do not have to re-invent the wheel in all areas.

Company Expertise

Verchaska Travel platform. Clients: cleartrip,eezego,eToursOnline

Binary semantics

Maruti Udyog Ltd, automartindia.com

ProSolutions Software

India Plaza, rediff-shopping, indiatimes

eStoreGroup Merchant integration

Trends That Will Shape E-Commerce In India In 2014

• Big Data fuels big changes in business innovation

• Brick to click to mobile, e-commerce goes the Omni-channel route

• From SEO to storytelling – quality content takes precedence

• Building customer confidence – trust and transparency is paramount

• From cash-on-delivery to next-day-delivery

• Sell everything online!

Key Findings

• Average order values climbing up rapidly

• Fashion category doubled last year

• Mobile shopping is seeing phenomenal growth

• Women influenced sales will grow 5x in next 3 years