M-Commerce & E-Commerce: Trends and Developments

Trends and developments taking place in the worldwide m-commerce and c-commerce sectors (www.researchandmarkets.com)
- By 2012 it is expected that more than 1 trillion will be spent online by B2C consumers. B2B spending will exceed this considerably.
- E-payment solutions are an important part of e-commerce transactions; however security issues continue to tarnish the industry.
- Asia Pacific leads the world in terms of using mobile phones for m-payments, accounting for around 85% of customers worldwide.
- BuddeComm estimates revenue from mobile content and services (excluding SMS), accounts for around 7-10% of total mobile revenues worldwide. SMS remains popular and accounts for a further 10% of total mobile data revenues..
- Online advertising growth is set to continue for the next few years, but will slow slightly in the wake of the US financial crisis. It is expected that online advertising will eventually account for around 20% of all advertising spend in some markets.
- Search services are central to almost everything that users do online, and this places leading search companies such as Google and Yahoo at an advantage. In the emerging Chinese market, Baidu and Alibaba also have a good foothold.
- Google is still the most popular website property worldwide; however individual countries and regions show unique differences with many local sites remaining popular. Other web properties proving popular across multiple markets include Yahoo, Microsoft and Wikipedia sites, Apple Inc, eBay and Amazon.

e-Commerce: Gaining Traction in India

e-Commerce was a non starter in India in the early days. That was before IRCTC stepped in with its online booking. I remember the long painful queues in front of the railway booking counters before the online booking system of IRCTC stepped in. A railway ticket in those days could be booked only by an agent or else, the whole activity of booking a train ticket used to be a half day ordeal in itself. All that changed with the advent of IRCTC train ticket reservation. How easy it was booking a ticket by simply clickinginto the website and doing the needful. The long sweaty queues were now relegated to history.

Led by train and flight reservations online ticketing has been the most successful force in online E-commerce industry. This also supplemented by the fact that today online travel industry constitutes 78% of the total E-commerce industry in India.

IRCTC contributes to 1/3rd of the total e-Commerce revenues in India. The e-Commerce revenues are slated at Rs. 9000 crores and IRCTC contributes Rs.3400 crores in that. 45 million tickets were sold in FY 2008 and it has seen a jump of 100% YOY. However the potential for IRCTC is still higher and it can yet add more revenues to itself. A few steps to increase the online ticketing activity:

1. Reduce additional charges for i-tickets and e-tickets to increase penetration and induce more people into a internet based ticket purchase. This helps since the service is mostly used by agents who charge additional commission apart from charges levied by IRCTC from their customers this again limits the penetration level and if the users are given more payment avenues it could propel many to go for direct transactions.

2. Allow booking of rail cargos and other railway services on a large scale then it can definitely garner more traction in terms of higher transaction size and remove bottlenecks at the same time attracting SME to the fold.

3.Association with commercial banks may help in getting more traction especially if rail cargos and other services are introduced through IRCTC.

The growth today is good, but it could get much better if these simple steps are also taken up. For Railways, it would reduce process costs of maintaining a bulky ticketing department.

The other large player which can simply multiply its value add by online transactions is India Post. It currently delivers 1,575 crore mails every year linking every nook and corner of the country through a network of 1,54,149 post offices and 5,64,701 letter boxes. The government owned services like India post if implements E-commerce in a serious way then India could definitely remove the barriers of E-commerce industry.