Emerging M-Commerce Opportunities: A Study of Growth in Banking, Retail and Travel

DISSERTATION PROJECT: FINAL REPORT SUBMISSION
As a part of degree completion at

IIFT
on
EMERGING VALUE PROPOSITIONS FOR M-COMMERCE:

A STUDY OF GROWTH, OPPORTUNITIES AND
ROADBLOCKS
Under the guidance of

Professor Sonu Verma
Submitted by
Eram Fatima
20C, MBA(IB) 2015-17
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CERTIFICATE FROM THE GUIDE
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ACKNOWLEDGEMENTS
I would like to express my sincerest gratitude to Professor Sonu Verma, IIFT, New Delhi, who is
my project guide and mentor, for providing me her constant guidance and support and for her
valuable time and essential inputs throughout the course of this project, without which the
completion of this report would have been impossible.
I would like to extend my heartfelt gratitude to all my IIFT seniors working in different sectors
for taking time off their busy schedules to be interviewed for the research purpose of this
project.
Last but not the least; I would like to thank all those who took time out of their busy schedules
to fill the questionnaire surveys floated by me. Their response was of the utmost importance
for the completion of this project.
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TABLE OF CONTENTS
List of Figures
List of Tables
Executive Summary
Objectives
Scope
Abstract
Methodology
Analysis and Discussion
Recommendations
1. Introduction
2. Literature Review
2.1 Mobile Wireless Technologies: The journey so far

2.2 M- commerce: Moving beyond E- commerce
2.3 Emerging applications of m- commerce in various sectors
2.4 Impact of m- commerce on people and organizations
2.5 Opportunities & Roadblocks
3. Research Methodology
3.1 Exploratory research framework

3.2 Questionnaire design
3.3 Data Analysis
4. Sectoral Study- Banking And Digital Payments
4.1 Overview
4.2 Current Indian market scenario
4.3 Value propositions of m-commerce: Mobile apps and digital wallets
4.4 Mobile apps and digital wallets: A comparative study
4.5 M-commerce in banking and digital payments: Challenges
5. Sectoral Study- Grocery Retail
5.1 Overview
5.3 Value propositions of m-commerce: Online grocery retail apps
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5.4 Grocery retail apps: A comparative study
5.5 M-commerce in online grocery retail: Challenges
6. Sectoral Study- Travel and Tourism
4.1 Overview
4.3 Value propositions of m-commerce: online travel and tourism apps
4.4 Online travel and tourism apps: A comparative study
4.5 M-commerce in online travel and tourism: Challenges
7. Recommendations and Conclusion
7.1 Banking and Digital payments

7.2 Grocery Retail
7.3 Travel and Tourism
7.4 Suggestions for policy makers and service providers
8. References
9. Annexures
9.1 Questionnaires for customer survey

9.2 Survey Demographics and Responses
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LIST OF FIGURES
Fig 1.1: Global scenario (Source: BI Intelligence report, 2015)
Fig 1.2: Growth forecast for online retailing and marketplaces in India (Source: CRISIL, 2015)
Fig 2.1: The different generations of mobile internet (Hindu, 2015)
Fig 2.2: Modes of digital payment after demonetization (Source: report issued by RBI)
Fig 2.3: Areas for improvement (Source: Livemint, 2015)
Fig 4.1: Estimated size of digital payments market in India (Source: Deloitte Research, 2016)
Fig 4.2: The mobile wallet landscape in India (Source: CMR report, 2016)
Fig 4.3: High growth rate of mobile banking transactions in terms of value (Source: RBI, 2015)
Fig 4.4: The multiple applications of mobile banking
Fig 4.5: Mobile wallets in India (Source: Livemint, 2016)
Fig 5.1: Market size of organized grocery retail in India (Technopak, 2016)
Fig 5.2: Funds raised by various Indian online grocery businesses (Source: Morgan Stanley,
2016)
Fig 5.3: The various segments of grocery retail percentage wise (Source: PWC report, 2016)
Fig 5.4: Funds raised by online grocery groups in India (Source: The Hindu, 2016)
Fig 6.1: Indian Travel Industry breakup (Phocuswright, 2014)
Fig 6.2: Key online travel agencies (MMT investor presentation, 2014)
Fig 6.3: Consumer division for Indian Travel Industry (Octane research, 2015)
Fig 6.4: Size of online Indian Travel and Tourism Industry in USD billion (Octane research, 2015)
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LIST OF TABLES
Table 1.1: Statistics (Source: IBEF report, 2015)
Table 3.1: Factors for data analysis
Table 4.1: Comparison of Mobile apps in banking and digital payments (Source: Gadgets360,
2016)
Table 5.1: Comparison of Mobile apps in online grocery retail sector (Source: Gadgets360, 2016)
Table 6.1: Comparison of Mobile apps in online travel and tourism (Source: Gadgets360, 2016)
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EXECUTIVE SUMMARY
Title: Emerging value propositions for m-commerce: A study of growth, opportunities and
roadblocks
Author: Eram Fatima
Academic year: 2016-17
Mentor: Dr. Sonu Verma
Majors: Marketing & Strategy, MBA (IB), Indian Institute of Foreign Trade, New Delhi
Objectives
With the 3Ds i.e. the election of Donald Trump, the implementation of Demonetization and the
increasing advent of Digitization, the scope and scale of m-commerce is wider than ever and
this paper aims to cover on them exhaustively. The key objectives include the following:
I. Provide an overview on the fundamentals of m-commerce covering its relationship with

e-commerce
II. Provide a brief description of the applications of m-commerce in select sectors
III. Identify the unique value propositions that m-commerce can provide to businesses in
the selected sectors
IV. Establish the existing and emerging growth opportunities for m-commerce in the Indian
context
V. Understand the current scenario of the Indian mobile commerce market in terms of
challenges and roadblocks
VI. Suggest the recommendations to improve the leverage the opportunities from a
consumer’s perspective.
Scope
Under the scope of this paper, we would be covering a few sectors for which m-commerce
holds the maximum value propositions in the future and identify the emerging opportunities
that lie within the businesses across these sectors based on the current market scenario
especially in lieu of demonetization and the push towards a cashless economy. The sectors
chosen are:
I. Banking and digital payments: The value propositions in digitizing banking and payments
to make it cashless and also to improve more customizations and security features.
II. Grocery retail and food service: The emerging ways of expanding the distribution
channels, marketing and branding products in innovative customized manners through
different models
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III. Travel and tourism: The scope of increasing penetration and increase the overall
revenues in this sector via m-commerce
Abstract
The purpose of this report is to study the scope and emerging value propositions of M-
commerce in the Indian market. Factual information available via trusted sources was
integrated into the research and questionnaire developed to collect the data from all over the
country. The study was a non-parametric survey essentially where majority of the subjects
showed agreement towards scope and adoption of M-commerce and gave a clear indication for
its further potential stating their expectations and satisfaction. Findings also confirm that there
is a lot of scope and potential for M-commerce services in India along with unique value
propositions being offered in different sectors. M-commerce is complex in nature and includes
changing the traditional market models and still has a long way to go. Suggestions for future
research and implications to service providers and policy makers have also been discussed.
This paper therefore attempts to help the readers, especially the ones interested in emerging
value propositions of m-commerce, to understand the key avenues for the expansion of the
scale and scope of m-commerce in various sectors across India and the emerging value
propositions and each of the sub- sectors. At the end, it aims to understand the challenges and
roadblocks hindering the growth opportunities and suggests recommendations from a
consumer’s perspective to realize its full potential.
Methodology
In an attempt to prepare a comprehensive report on m-commerce covering all the possible
aspects of its emerging value proposition, I am conducting an in depth exploratory research to
obtain most of the necessary data followed by a detailed analysis of the same qualitatively and
quantitatively.
 Secondary research: The secondary research would mainly include literature reviews of
sector reports, published online and offline research papers, journals, magazines and
different websites over the internet. It will be done to collect as much data as possible
in order to ensure that the paper is up to date with the latest content and covers as
many aspects as possible to keep it comprehensive. The data will be obtained from the
most credible and certified sources to keep the points accurate and up to date and only
official reports would be trusted. All the sources would be included in the report in the
form of full citation.
 Primary research: Under the primary research, I’d be conducting in depth interviews of
people working in different companies for each of the above sectors namely banking
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and digital payments, grocery retail and food services, and travel and tourism. This will
be done in order to understand the unique value propositions of m-commerce based on
the changing consumer trends in terms of expectations and the facilitation of the same.
It will be followed by a consumer survey with a sample size of 80-100 people which will
be designed in accordance with the key pain points discussed above by interviewing
industry experts to gather insights from the TGs to highlight the gaps and challenges the
consumers are facing, based on whose results, recommendations would be provided
which would be included in the final report.
Analysis and discussion: The data collected via various sources and analyses using
research tools such as factor analysis has helped identify the unique value propositions of the
various businesses operating under each of the identified sectors. For all three, the current
market scenario has been discussed with respect to the Indian market, to identify the driving
factors for each of the sector while also understanding the consumer trends and the existing
propositions that the various businesses have on offer. A brief overview has been done for the
major players in each of the sectors and a comparative study has been conducted to identify
the common and differentiating parameters the top players share. The challenges for each
sector have been identified as well.
Recommendations: The recommendations have been based on the findings from the
primary and secondary research to identify the emerging value propositions from the
perspective of consumers and their expectations from each of the businesses. Suggestions have
also been provided to policy makers and m-commerce service providers to make improvements
on their parts in overcoming the identified gaps and bridging them in order to leverage the
opportunities provided by the emerging value propositions.
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1. INTRODUCTION
Mobile has grown to become the most dominant means for accessing omni-channel
communications especially because deployment of mobile network is not just the most cost-
efficient but also happens to provide greater amount of convenience and flexibility to its
subscribers as compared to other available means of communication (Sanjay, 2007). Mobile
Commerce is a subset of e-commerce, that generally includes all e-commerce transactions,
carried out using a mobile (hand held) device. In fact, the biggest difference between e-
commerce and m-commerce is the usage of the wireless net or GPS technology for performing
all financial services and purchases across different areas. In simpler words, M-commerce
allows all kinds of trade transactions such as business-to-consumer, business-to-business and
consumer-to-consumer across the domains of a user’s choice with increasingly widening scope
and scale. Its booming popularity has forced the corporate world to join the bandwagon and
develop a new commerce platform that can reach to masses via mobile phones. (Sharma,
2009).
Fig 1.1: Global scenario (Source: BI Intelligence report, 2015)
Smartphones in India 150,000,000

Monthly addition 8,000,000
3G subscribers 40 mn
Monthly app downloads 150+ mn
M-commerce market size $2 bn
Table 1.1: Statistics (Source: IBEF report, 2015)
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Mobile e-commerce (m-commerce) is the cumulative term that describes all online sales
transactions done via the usage of wireless electronic devices such as hand-held computers,
mobile phones or laptops. These wireless devices interact with internet networks such as 2G,
3G or 4G depending on the connectivity and that have the ability to conduct online
merchandise purchases, be it a product or a service. Any type of cash exchange over a wireless
network is referred to as an e-commerce transaction. Mobile e-commerce is just one of the
many subsets of electronic commerce. (Jordan et al., 2008)
If we look at the current trends in the world of business, there has been a steady shift of
consumer behavior from brick and mortar stores to online shopping whether it’s retail or
banking or traveling or any other sector for that matter and this increasing preference hasn't
been lost on wireless electronic device manufacturers either. Mobile electronic commerce is
yet another way to ensure the purchase of online items from electronic storefronts or online
services from automated service providers. It’s the responsibility of businesses to ensure the
availability of to enable these transaction processes through electronic store searches and
electronic point-of-sale capabilities online. Other mobile devices include iPads, smartwatches or
smartphones.
Device vendors are therefore targeting younger generations comprised of the millennials who
use mobile phones more than any other age group, thereby prompting these online vendors to
collaborate with big names in the telecommunications industry to promote the advancement of
e-commerce to m-commerce by providing high-speed connectivity at affordable rates so that
users can easily shop online from their phones via apps and mobile sites. Most of these
advances have been accomplished through a collaborated effort of government and businesses
to enable a digital India through the provision of sophisticated application designs that are
constantly emerging and evolving to minimize the costs and maximizing the efficiency.
One of the features of m-commerce sites is the adaptation of websites on smartphones to

make them easier to use with smaller screen sizes in the form of mobile sites. There are a
number of adaptations that can be made including the removal of large graphics and the
optimization of fonts for easier viewing and ergonomics (Terence et al., 2015).
If we talk about the urban level, the approach is mostly of web-first businesses that are
naturally adapting to the mobile world with a quick transitional shift. From ecommerce
marketplaces (e.g. Flipkart) and travel aggregators (e.g. MakeMyTrip) to online classifieds (e.g.
OLX) and media libraries (e.g. Saavn), almost all of these well-established online portals are
continuing the inevitable transition from desktop only to the rapidly growing channel of
mobiles (Potharaju et al., 2016).
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Talking about the travel and tourism sector, which is the largest part of e-commerce, travel
sites like IRCTC, MakeMyTrip, Cleartrip and Yatra, for example, have been taking huge steps in
mobile since the last year, which has magnified manifold ever since demonetization.
After struggling for long to become profitable in a disjointed travel industry, these companies
have begun to emphasize on mobile phones in the hopes of cashing in on the country’s growing
smartphone user base and the shift towards a cashless economy enabled via digital
transactions. This highly strategic move has been working in the favor of the sector. In the last
fiscal quarter, Cleartrip saw a whopping 60 percent of its overall traffic coming from mobile
channels — thus outpacing desktop traffic for the very first time ever.
Fig 1.2: Growth forecast for online retailing and marketplaces in India (Source: CRISIL, 2015)
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2. LITERATURE REVIEW
To give a structure to the points that have been put forward in the introduction, we can now
present it under the following sections.
2.1 Mobile Wireless Technologies: The journey so far

Mobile telecommunications have come a really long way since 1973 when Martin Cooper of
Motorola, which is the first commercially available handset in the market, demonstrated it. The
early 2000s saw the advent of 3G technology which made web-browsing far more feasible on
mobiles as compared to the 2nd generation. Telecom operators splashed out over $100 billion
on radio-spectrum licences to cash it in and increase their consumer base, only to find out that
this sought after technology which most of them had agreed to use was much harder to
implement than expected. (Mofluid, 2015) As the LTE technology was introduced with the
auctioning of 4G spectrums, we have come much farther now. The launch of Reliance Jio has
completely revolutionized the world of high speed mobile connectivity and all other operators
are trying hard to catch up.
Fig 2.1: The different generations of mobile internet (Hindu, 2015)
The predicted advent of 5G and other advanced technologies is likely to bring another huge
splurge of investment, just as the orders for 4G equipments are peaking. The goal of both the
government and the businesses is to be able to offer consumers nothing less than the
“perception of infinite capacity”. Non-existent will be a device that is not wirelessly connected,
and digitally enabled to be connected with every other possible appliance that together
constitute the “internet of things” (IoT).
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2.2 M- commerce: Moving beyond E- commerce
The mobile channel is here to last forever and grow infinitely. In fact, it’s not a recent overnight
innovation, but has been evolving over a decade exhibiting significant growth and maturity in
the last few years, supported by government initiatives and increasingly competitive business
scenario with the rising number of startups for e- commerce.
The growth of smartphones in the last decade has only fueled the market space for m-
commerce, with a projected global forecast of $700 billion market share by 2017. Simply put,
m-commerce using app based touch points, mobile lite sites and eliminating web based
interfaces is the rage today. Business enterprises are seemingly moving away from maintaining
websites for commerce on desktop only and are starting to offer only app based services to
users. (Shannon, 2016)
2.3 Emerging applications of m- commerce in various sectors
Mobile commerce took off in 2015, courtesy the converging advances in mobile apps in retail
and banking sectors, improved smartphone capabilities, customized and highly advanced
personalization technologies, and mobile payment solutions. The end of 2016 marked by
demonetization marked a magnanimous rise in the mobile commerce traffic in a bid to shift
towards the cashless economy and make businesses transition towards a formal sector.
Most m-commerce advances in 2015 were largely driven by the retail market (consider
Amazon, eBay and Flipkart), and also travel apps such as Ola, Uber and Jugnoo. The majority of
the growth was driven by online shoppers comprised of millennial purchasing traditional
goods (i.e. clothing and electronics) from retailers via mobile apps. (Economic Times, January
2016)
2.4 Impact of M-commerce on people and organizations
There are around 10 billion mobile devices in existence in a world population of over 7 billion.
That’s the reach of mobile phones so it doesn’t come as much of a surprise that mobile
commerce is shaping the way businesses are being conducted these days.
It has come as a blessing, and not in disguise either, for the consumers who want access to any
product of their choice instantly at the tip of their fingers. For business owners although, it has
come as a challenge that will either allow them to surge over their competitors if they are able
to undergo a technological and cultural shift to join the bandwagon or make them sink in the
waters of oblivion if they fail to do so. Either way, M-Commerce has been here for a while and it
will surely stay and advance with the passage of time. With the availability of Plug-ins like
Mofluid to create magento mobile apps for any ecommerce store, it is set to grow at an even
faster rate. (Livemint report, April 2016)
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2.5 M-commerce in India: Moving towards a cashless economy
As 2016 draws to an end, mobile commerce in India is set to undergo a highly remarkable and
exciting transition. Owing to the increasing access to smartphones via growing mobile Internet
penetration and made possible by several government-led digital inclusion initiatives, India has
seen an impressive rise in the everyday transactions conducted via mobile devices—and it has
just started. Zinnov, a consulting firm, recently released a market report estimating that India’s
market for mobile commerce was worth $2 billion in 2014 and is estimated to grow up to $19
billion by 2019. In fact, India has become one of the top five countries for Google Play store,
with an increasing number of India’s 1.2+ billion people looking to search, interact and shop on
the go via their smartphones and other mobile devices. (BI Intelligence report, 2015)
Fig 2.2: Modes of digital payment after demonetization (Source: report issued by RBI)
2.6 Opportunities and roadblocks
There are many interesting research problems in mobile commerce. Some of these are unique
due to the limitations of mobile devices and wireless networks and some are similar to research
problems that are currently being addressed by e-commerce researchers and developers. The
problems that are unique to m-commerce are:
• Novel applications and services due to the wireless networks and mobile devices,
• Security and privacy problems
• Infrastructural and logistics issues
• Role of different wireless networking standards
• Adoption factors of mobile devices that are significantly different in different parts of
the world.
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Fig 2.3: Areas for improvement (Source: Livemint, 2015)
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3. RESEARCH METHODOLOGY
In an attempt to prepare a comprehensive report on m-commerce covering all the possible
aspects of its emerging value proposition, I am conducting an in depth research to obtain most
of the necessary data followed by a detailed analysis of the same (in the form of analyzing the
survey results).
3.1 Exploratory research framework

As stated earlier, the goal of the exploratory research would be to explore the research
objectives instead of offering the final conclusions. It would help us understand the scope of
the project in a better manner and help us meet the key objectives by collecting data and
gathering insights based on its analysis.
3.1.1 Problem statement: The purpose of this research is to establish the scope and
adoption of M-commerce in India across key industrial sectors. In order to achieve this
purpose, quantitative approach has been taken to conduct a consumer survey of the
‘smartphone users engaging in m-commerce’. The outcome of this research would be
beneficial to businesses in improving the value propositions that are on offer in order to
bridge the gap between expectations and services.
3.1.2 Procedure: It would follow the following steps to achieve the desired results.
 Secondary research: The secondary research would mainly include literature reviews of
sector reports, published online and offline research papers, journals, magazines and
different websites over the internet. It will be done to collect as much data as possible
in order to ensure that the paper is up to date with the latest content and covers as
many aspects as possible to keep it comprehensive. The data will be obtained from the
most credible and certified sources to keep the points accurate and up to date and only
official reports would be trusted. All the sources would be included in the report in the
form of full citation.
 Primary research: Under the primary research, I’d be conducting in depth interviews of
people working in different companies for each of the above sectors namely banking
and digital payments, grocery retail and food services, and travel and tourism. This will
be done in order to understand the unique value propositions of m-commerce based on
the changing consumer trends in terms of expectations and the facilitation of the same.
It will be followed by a consumer survey with a sample size of 80-100 people which will
be designed in accordance with the key pain points discussed above by interviewing
industry experts to gather insights from the TGs to highlight the gaps and challenges the
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consumers are facing, based on whose results, recommendations would be provided
which would be included in the final report.
The literature review of the interim report would include an analysis of the aforementioned
sources. The research would mainly comply external sources available online and offline and
would be analyzed by comparing and contrasting all the collected data. The data would be
collected to cater to the objectives set at the outset in the synopsis and to fulfill the scope of
the project, and also to narrow down the domain of the primary research and make it more
focused.
3.1.3 Research objectives: To identify the unique value propositions of m-commerce in each of
the identified sectors namely banking and digital payments, grocery retail and travel and
tourism.
TARGET POPULATION
Urban Millenials – Our target customers are aged between 15-55 years of age who visit malls
frequently, are either students or working or housewives and are tech-savvy and are busy in
their lives.
SAMPLING PLAN
The sample method used for survey of customers is non-probabilistic convenience sampling.
Here convenience sampling is used as the survey is taken by intercepting the customers coming
directly by floating the questionnaire to the target audience. Due to this, the problem of
identifying the target customer is eliminated. And in addition to this there are time & location
constraints. So convenience sampling is the most appropriate method in this case.
Sample size n= 120 respondents in total
3.2 Questionnaire design

The questionnaire has been divided into two sections for the purpose of research.
The last section will deal with demographic multiple choice questions pertaining to collecting
the following set of information from the respondents:
 Gender: Male/ female/ other

 Age: 15-25/ 26-35/ 36-45/ 46-55/ above 55
 Education: Intermediate/ bachelor/ master/ PhD & above
 Occupation: Student/ Housewife/ Self-employed/ Service/ Others
 City: Metropolitan/ Non-metropolitan
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The first section of the survey has a few behavioral and usage based MCQs to gather
information related to:
 No. of m-commerce devices owned: 1/2/>2

 Purpose of use: personal/official/both/neither
 Areas of usage: internet or mobile banking/ shopping online/ booking tickets and hotels
 Preference of usage: social media, online shopping, ordering food, booking tickets and
hotels, internet banking etc.
The second section of the questionnaire has five point Likert scale type questions (1 being
strongly agree and 5 being strongly disagree) to identify the unique value propositions of the
top performing apps in each sector as viewed by the consumers. There are 8 such questions for
each sector representing 8 factors pertaining to features and functionality of the apps. There is
another question to identify the emerging value propositions of each of these sectors. The
factors that have been identified for each of the sector are as follows.
BANKING & DIGITAL GROCERY RETAIL TRAVEL & TOURISM

PAYMENTS
Payment gateway Payment Gateway Payment Gateway
Convenience Deals and offers Deals and offers
Security Discounts Cashbacks, discounts, virtual

money
Cashbacks Variety Services
Bill Payments Convenience Feedback
Offers & Deals Quality Reliability
Versatility Pricing Customer Support Service
Overall experience Delivery Accessibility
Table 3.1: Factors for data analysis
The questionnaires have been attached in the annexure for reader’s reference.
Sample Demographics: A total of 120 respondents were surveyed for the purpose of this
research of which approximately 60% are males and 40% are females. Their age groups vary
mainly between 15-45 years of age of which the majority comprising of 65% belongs to the 15-
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25 age group followed closely by the 26-35 age group forming 25% of the respondents and the
rest by the age groups above that. The respondents are pursuing a range of occupations from
business to service with a major chunk being dominated by students and professionals (close to
70%).
3.3 Data Analysis

Two statistical methods of analysis were used for the purpose of this research.
3.3.1 Multiple Regression
Multiple regression is an extension of simple linear regression. It is used when we want to

predict the value of a variable based on the value of two or more other variables. The variable
we want to predict is called the dependent variable (or sometimes, the outcome, target or
criterion variable). The variables we are using to predict the value of the dependent variable are
called the independent variables (or sometimes, the predictor, explanatory or regressor
variables). Multiple regression also allows you to determine the overall fit (variance explained)
of the model and the relative contribution of each of the predictors to the total variance
explained.
Variables used for Regression
Dependent variable: AppPreference
Independent variables: DesktopVsMobileApp, ConveniencePaytm, SecureBankApps,

SocialMedia, PGBankApps, SecureMobikwik, ConvenienceHDFC, OnlinepaymentPref,
OnlineShoppingMobikwik, CashBackHDFC, OnlineShoppingBankApps, PGHDFC,
ConveneienceHDFCChillr, ConvenienceMobikwik, CashBackBankApps,
OnlineShoppingAirtelMoney, BillPayMobikwik, BillPayHDFC, OrderingFood, PGMobikwik,
SecureHDFC, BookingTickets, BillPayPaytm, BillPayAirtelMoney, ConvenienceBankApps,
CashBackAirtelMoney, PGAirtelMoney, DeviceUse, SecurePaytm, ConvenienceAirtelMoney,
OnlineShoppingUPI, OnlineShoppingPaytm, SecureUPI, CashBackMobikwik, BillPayUPI, PGUPI,
OnlineShoppingHDFC, CashBackUPI, NoOfDevices, OnlinePayments, InternetBanking,
SecureAirtelMoney, PGPaytm, CashBackPaytm, BillPayBankApps
The hypotheses for this analysis will be:

Null Hypothesis: The independent variable under consideration does not significantly affects
the dependent variable.
Alternate Hypothesis: The independent variable under consideration significantly affects the
dependent variable.
Regression Analysis
We have now carried out the regression for the variables with interval level data.
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b
Model Summary
Change Statistics
Std. Error of
R Adjusted R the R Square F Sig. F Durbin-
Model R Square Square Estimate Change Change df1 df2 Change Watson
a
1 .589 .347 .259 1.15201 .347 3.955 45 335 .000 1.389
Regression analysis was carried out on all the 46 variables. The R square value is 0.347 which
means 34.7% of the model is explained by these variables.
Durbin-Watson value of 1.389 shows independence of residuals.
b
ANOVA
Model Sum of Squares df Mean Square F Sig.
a
1 Regression 236.223 45 5.249 3.955 .000
Residual 444.586 335 1.327
Total 680.808 380
The ANOVA shows that the model is significant.

a
Coefficients
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) -.319 .356 -.896 .371
NoOfDevices -.033 .065 -.030 -.506 .613
DeviceUse .043 .062 .039 .684 .495
OnlinepaymentPref -.184 .064 -.153 -2.865 .004
ConvenienceHDFC -.013 .061 -.012 -.215 .830
ConveniencePaytm -.035 .064 -.029 -.553 .581
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ConveneienceHDFCChillr -.023 .062 -.019 -.365 .716
ConvenienceBankApps -.012 .063 -.010 -.191 .848
ConvenienceAirtelMoney .028 .061 .026 .465 .643
ConvenienceMobikwik .056 .060 .049 .935 .350
PGBankApps .376 .057 .332 6.649 .000
PGUPI .100 .092 .065 1.079 .281
PGPaytm .052 .104 .031 .505 .614
PGHDFC .080 .087 .052 .915 .361
PGMobikwik .022 .075 .016 .291 .771
PGAirtelMoney -.125 .072 -.096 -1.734 .084
SecureBankApps .043 .064 .037 .671 .503
SecureHDFC -.071 .071 -.054 -.991 .322
SecurePaytm .053 .067 .043 .785 .433
SecureMobikwik -.013 .068 -.010 -.190 .850
SecureUPI .062 .067 .055 .922 .357
SecureAirtelMoney -.045 .066 -.041 -.678 .498
CashBackBankApps -.091 .061 -.080 -1.499 .135
CashBackUPI .006 .079 .005 .075 .941
CashBackPaytm -.017 .068 -.015 -.244 .807
CashBackAirtelMoney .085 .069 .073 1.235 .218
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CashBackMobikwik -.014 .076 -.011 -.187 .852
CashBackHDFC .128 .062 .108 2.063 .040
SocialMedia -.049 .083 -.035 -.589 .556
OnlinePayments .075 .089 .050 .843 .400
OrderingFood .013 .073 .009 .173 .863
BookingTickets .079 .078 .058 1.018 .309
InternetBanking -.082 .085 -.057 -.963 .336
OnlineShoppingBankApps .120 .081 .083 1.484 .139
OnlineShoppingUPI -.044 .083 -.030 -.530 .597
OnlineShoppingHDFC -.107 .092 -.068 -1.154 .249
OnlineShoppingAirtelMoney -.066 .082 -.042 -.801 .424
OnlineShoppingMobikwik .052 .072 .040 .723 .470
OnlineShoppingPaytm .036 .072 .028 .507 .613
BillPayBankApps -.039 .073 -.034 -.539 .590
BillPayUPI .088 .071 .076 1.251 .212
BillPayHDFC .065 .062 .057 1.038 .300
BillPayAirtelMoney .021 .078 .015 .264 .792
BillPayMobikwik .145 .065 .122 2.232 .026
BillPayPaytm .071 .062 .060 1.145 .253
DesktopVsMobileApp .190 .065 .173 2.902 .004
24 | P a g e
a. Dependent Variable: AppPreference
Regression analysis was carried out on all the 46 variables. It was found that the variable
‘PGBankApp was most significant with a Beta value of 0.332 showing that customers prefer
banking apps the most when it comes to choosing payment gateways.
Other significant variables are Cashback HDFC, BillPayMobikwik, DesktopvsMobileApp etc.
showing us the most important propositions a customer looks for.
a
Residuals Statistics
Minimum Maximum Mean Std. Deviation N
Predicted Value -.3185 4.5713 2.2467 .78844 381
Residual -3.04343 3.21649 .00000 1.08165 381
Std. Predicted Value -3.254 2.948 .000 1.000 381
Std. Residual -2.642 2.792 .000 .939 381
a. Dependent Variable: AppPreference
It represents a normal distribution of residuals. Since, we have 46 variables and this regression
model is unable to define with much clarity which of them are affecting the data significantly
and which ones are not, so we proceed with the Factor Analysis to check if these 46 variables
can be reduced to a fewer number of factors. Also, we can see that the data isn’t completely
free from multi-collinearity.
3.3.2 Factor Analysis:
There are two methods for driving factor analysis; these two methods are as follows:
1. Principle component factor analysis method: This method is used when we need to
drive the minimum number of factors and explain the maximum portion of variance in the
original variable.
2. Common factor analysis: This method is used when the researchers do not know the
nature of the factor to be extracted and the common error variance.
We will be using Principle Component Analysis methods.
Selection of factors to be extracted: Theory is the first criteria to determine the number of
factors to be extracted. From theory, we know that the number of factors extracted does make
sense. Most researchers use the Eigenvalue criteria for the number of factors to be extracted.
25 | P a g e
Value of the percentage and variance explained method is also used for exploratory factor
analysis. We can use the Scree test criteria for the selection of factors. In this method,
Eigenvalue is plotted on a graph and factors are selected.
Orthogonal rotation: In this method, axis are maintained at 90 degrees, thus the factors are
uncorrelated to each other. In orthogonal rotation, the following three methods are available
based on the rotation:
A. QUARTIMAX: Rows are simplified so that the variable should be loaded on a single factor.
B. VARIMAX: Used to simplify the column of the factor matrix so that the factor extracts are
clearly associated and there should be some separation among the variables.
C. EQUIMAX: The combination of the above two methods. This method simplifies row and
column at a single time.
Criteria for Practical and Statistical Significance of Factor Loadings: Factor loading can be
classified based on their magnitude:
Greater than + .30 — minimum consideration level
+ .40 — more important
+ .50 — practically significant
Power and significance level: The researcher can determine the statistical power and
significance level. For instance, in order to achieve a factor loading of .55 with a power of .80, a
sample of 100 is needed.
Factor Extraction & Analysis
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .835
Bartlett's Test of Sphericity Approx. Chi-Square 4917.592
df 990.000
Sig. .000
KMO Test value is greater than 0.5, which shows Sample is adequate.
Bartlett’s Test of Sphericity has a significant value (less than 0.05) which shows the validity and
suitability of the responses collected to the problem.
Communalities
Initial Extraction
Unstandardized Predicted Value 1.000 .992
Unstandardized Residual 1.000 .995
26 | P a g e
Standardized Predicted Value 1.000 .992
Standardized Residual 1.000 .995
Unstandardized Residual 1.000 1.000
Standardized Residual 1.000 1.000
Extraction Method: Principal Component Analysis.
Table shows communalities when we use Factor extraction by PCA method. Here, communalities signify
what percent of a factor has been extracted in the process.
a
Component Matrix
Component
1 2 3 4
Unstandardized Predicted Value .654 .749 .020 -.055
Unstandardized Residual .756 -.650 -.011 .012
Standardized Predicted Value .654 .749 .020 -.055
Standardized Residual .756 -.650 -.011 .012
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Unstandardized Predicted Value .700 .660 -.029 .013
Unstandardized Residual .714 -.655 .030 -.045
Standardized Predicted Value .700 .660 -.029 .013
Standardized Residual .714 -.655 .030 -.045
Unstandardized Predicted Value .106 .113 -.128 .979
Unstandardized Residual .000 -.014 .991 .132
Standardized Predicted Value .106 .113 -.128 .979
Standardized Residual .000 -.014 .991 .132
a. 4 components extracted.
This table shows that 4 factors have been extracted through PCA extraction method. The values
in each factor column are called the factor loadings.
Total Variance Explained
Extraction Sums of Squared Rotation Sums of Squared

Initial Eigenvalues Loadings Loadings
% of Cumulative % of Cumulative % of Cumulative

Component Total Variance % Total Variance % Total Variance %
1 8.016 40.080 40.080 8.016 40.080 40.080 7.859 39.295 39.295
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2 7.663 38.317 78.396 7.663 38.317 78.396 7.786 38.930 78.226
3 2.003 10.017 88.413 2.003 10.017 88.413 2.009 10.047 88.273
4 1.975 9.875 98.289 1.975 9.875 98.289 2.003 10.016 98.289
5 .342 1.711 100.000
6 2.148E-
1.074E-14 100.000
15
7 1.940E-
9.702E-15 100.000
15
8 9.418E-
4.709E-15 100.000
16
9 4.010E-
2.005E-16 100.000
17
10 3.597E-
1.799E-16 100.000
17
11 1.746E-
8.731E-17 100.000
17
12 4.575E-
2.288E-18 100.000
19
13 -1.301E-
-6.506E-18 100.000
18
14 -2.523E-
-1.262E-16 100.000
17
15 -4.656E-
-2.328E-16 100.000
17
16 -7.267E-
-3.633E-16 100.000
17
17 -9.474E-
-4.737E-16 100.000
17
18 -2.613E-
-1.307E-15 100.000
16
19 -1.657E-
-8.286E-15 100.000
15
20 -2.579E-
-1.289E-14 100.000
15
Extraction Method: Principal Component

Analysis.
29 | P a g e
This table shows that only the factors for which Eigen Values are greater than ‘1’ have been
extracted.
Through the Component Matrix it is well evident that these factors are not properly extracted
since the communalities are not clearly distributed across the factors. So, we proceed with the
rotation of factors.
We will be doing an orthogonal rotation using Varimax method.
a
Rotated Component Matrix
Component
1 2 3 4
Unstandardized Predicted Value -.012 .996 .019 .007
Unstandardized Residual .997 .018 .017 -.006
Standardized Predicted Value -.012 .996 .019 .007
Standardized Residual .997 .018 .017 -.006
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Unstandardized Predicted Value .001 .079 .996 .001
Unstandardized Residual .005 -.005 .001 1.000
Standardized Predicted Value .001 .079 .996 .001
Standardized Residual .005 -.005 .001 1.000
Rotation Method: Varimax with Kaiser Normalization.
This table shows that 4 factors have been rotated through Varimax rotation method. Now, we
can see that the communalities have been distributed across factors more effectively.
Component Transformation Matrix
Compone
nt 1 2 3 4
1 .745 .665 .053 .000
2 -.667 .743 .055 -.006
3 -.003 .015 -.130 .991
4 -.003 -.075 .989 .131
Rotation Method: Varimax with Kaiser Normalization.
The 4 factors thus extracted are (in the same order from 1-4):
Payment gateway, security, bill payments and cashbacks.
Similar analysis has been performed on the rest of the data and the findings have been included
in the report.
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4. SECTORAL STUDY- BANKING AND DIGITAL PAYMENTS
This chapter is going to cover a detailed study of the emerging value propositions of m-
commerce in the banking and digital payments sector. We will be analyzing a number of papers
and reports on the given sector along with the data collected through primary research to come
up with the existing and emerging unique value propositions for each of these in the area of m-
commerce, their growth, potential opportunities and challenges in the way in order to frame
our recommendations at the end of this report.
4.1 Overview
Almost all the major retail banks have now got banking apps for smart phones that are
progressive-designed to scales well on any mobile screen size in order to enable web banking.
Digital banking is set to go even further than this in the form of omni-channel banking. Starting
from 2015, there have been some massive transitional trends for digital design and omni-
channel retail development via smartphones that have influenced banking as well and an
integrated strategy has been formed in the form of a collaboration between brick and click and
stage has been set for completely mobile banks in India with DBS spearheading the mobile
banking revolution. There are also a lot of behind the scenes opportunities for m-commerce by
improving in-branch productivity, customer analytics and promote embedded digital banking.
The development of block chain technology is going to be an enabler for this (Kapoor et al.,
2016; Misra, 2015).
Fig 4.1: Estimated size of digital Fig 4.2: The mobile wallet landscape in India (CMR
payments market in India report, 2016)
(Source: Deloitte Research, 2016)
As far as the mobile payments market is concerned, it’s here to stay and has got enormous
potential. ‘A mobile wallet is a virtual cash wallet for making instant payments and other
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transactions, through a smart phone application.’ Demonetization has ensured that it’s not just
the tech savvy Indians who shop with cashless wallets, by using one’s mobile phone as a
financial tool, but also the larger part of the population in general by the introduction of UPI,
USSD, BHIM app and AEPS on the government’s part and the booming startups and banks along
with some other service providers. Mobile wallet is a very interesting concept, which is
becoming increasingly popular and has been integrated across consumer platforms. It doesn’t
just allow users to access their financial accounts on the move, but it also has an integral part to
play in the development of digital banking. (Kapoor, 2016)
The booming growth in mobile internet and smart phone users, and the increased focus on
convenience and accessibility, consist of some of the factors that are responsible for driving the
growth of the mobile wallets in India. It is expected to grow at a CAGR of 40% between 2016
and 2020. As of now, the top 5 key players in the Indian mobile market are Paytm, Mobikwik,
Oxigen, Citrus and Rupee (IJARCCE, 2016).
4.2 Current Indian Market Scenario

It’s obviously a no-brainer that banks are the backbone of any economy, which sink or sail with
them. Indian banks are no different. What isn’t common knowledge though is that this sector
has been experimenting a lot with technology. Despite being riddled with high risk, banking
services have slowly but steadily moved forward with digitization to offer improved and
customized customers services at their fingertips on their smartphones.
Over the past decade, banks have been making consistent use of technology to change their
operational landscape. This has acted as a boost to core banking platforms serving as a strong
launch pad for them to offer digital channel capabilities to customers. Most banks today are
feverishly developing an omni-channel strategy comprising both online and mobile channels for
carrying out transactions. ATM deployments have serviced large parts of the Indian hinterland.
And as a result internet and mobile banking have been seeing a high deployment rate
increasingly. The question is whether this is fast enough.
The number of smartphone users has risen of course. The target set of customers is brand new:
New generation millennials comprising the people born in the late 80s and early 90s.
Demonetization along with the Digital India campaign announced much earlier for the financial
inclusion of 1.2 billion people of the country by 2020, the push to digitization has been strong
and forceful of late. 2017 is therefore a year that will determine whether the Indian banking
sector can make it to the finish line and be a champion in the world banking industry (Desai,
2016).
The High Pace of Growth:
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2017 is set to bring in good news and quite literally set the cash registers ringing.
Fig 4.3: High growth rate of mobile banking transactions in terms of value (Source: RBI, 2015)
According to the World Bank bi-annual flagship report Global Economic Prospects PHD
Research Bureau, the growth rate for India is set to accelerate from 6.4 percent in FY2016 to 7
percent in FY2017. World Bank reported that this rate has been brought upon by a sharp slide
in inflation to multi-year lows, demonetization and wiping off of 86% currency in circulation and
improving export momentum in line with the rising demand from the US, a major trading
partner for India. According to Goldman Sachs, India’s GDP will grow 7.9 percent in 2016-2017.
(World Bank Bi-annual flagship report, 2016)
The end-user spending in 2016 was $366,673 million. That’s a 3.27 percent increase on
$355,065 million of 2015. The same positive trajectory will continue in 2017 as well. An
estimate of the end-user spending in 2017 is $380,408 million, thus showing a 3.75 percent
increase in two years from 2015 to 2017. (Gartner, 2016)
Moody’s Investor Services, an international ratings agency, also revised its outlook on the
Indian banking system to stable from the earlier opinion of negative, indicating that the local
operating environment for Indian banks is showing improvement. Moody’s had maintained a
negative outlook on Indian banks since 2011. (Livemint, 2011)
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The same positive sentiment of growth in the banking sector is being shared by the CIO
community as well. 2016 has shown a very high growth in the sector ranging from 18-20
percent and that just goes on to show that despite the economic scenario or government
policies, banks always have to grow and there is no alternative. This growth varies every year
from 5-20%. Banks have also been trying to perfect a business model that would be able to
leverage data analytics and social media to improve and customize services for its customers
and therefore increase their loyalty. Some other contributing factors of growth include
supportive government and regulatory policies. (Nayagam, 2017)
These developments have set the stage for various business and technology opportunities in
the sector. Established and well reputed banks can maximize customer value by leveraging
relevant channels through m-commerce and create newer and more innovative revenue
models.
According to Shiv Kumar Bhasin, CTO, State Bank of India, “Public sector banks will try to focus
on retail segment. They then would have to improve their customer service thus opting for
digital channels to compete with the private sector banks”. This is another indicator of the
change that’s about to come.
Mobile Banking triumphs Internet Banking:
With digitization making it to the top of the buzzwords used in the technology industry this in
2016 and demonetization becoming the most talked about issue in the world news headlines,
banking sector is definitely one to be the most benefitting from it and it’s going to need a
marathon to become entirely digital.
Investments in digital technologies are continuing at a high pace, creating a lot of scope to turn
both consumer and corporate banking entirely digitized. In 2015, paper-based transactions
accounted for 25 percent of total transactions, down from 34 percent in 2014. As of now, 78
percent of Indian CEOs believe that mobile technologies should be the strategic focus for better
customer engagement and boosting their loyalty. (Boston Consulting Group (BCG) and Google
India, 2015)
All the top private banks in India have already rolled out mobile banking apps to engage
customers as they mobiles are going to be the most predominant banking channel in the
upcoming days. According to Nitin Chugh, head of digital banking division at HDFC Bank,
“Mobile banking is growing at a rate of 100% and we expect that this will overtake internet
banking by next year”. (TOI, 2016)
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Fast payments involving small amounts of money using banking apps, digital wallets, payments
banks or through social chat platforms have gained massive popularity within customers and
are set to surpass existing online payment modes such Internet banking for utility bill payments
as well as retail. As per news reports, Axis Bank saw transactions in value terms through the
mobile channel at par with internet transactions at the beginning of 2015. Customer log-ins
from mobiles outstripped those through Internet for Kotak Mahindra Bank.
Amidst all this, the one model that drove the spearhead of changing trends and profitability are
digital wallets. We’ll be discussing them in detail in further sections. However, to show that this
change began over an year ago, I’d like to quote the example of YES Bank who partnered with
Snapdeal to launch Freecharge wallets as a competition for PayTm that was launched in
September 2015. (Oberoi, 2015)
Fig 4.4: The multiple applications of mobile banking
M-Commerce: The Latest Banking Correspondent
With expanding corporate banking and entry of banks into B2B environment, tie-ups with
various e-commerce companies and venturing into m-commerce are inevitable. It would be a
win-win situation, in which both of them will mutually help each other grow in the digital
ecosystem. The Reserve Bank of India is open to forming ventures with e-commerce companies
and let them act as banking correspondents along with granting banking licenses to telecom
operators such as Airtel thus increasing both competition and opportunity. (Bhasin, 2015)
36 | P a g e
These tie-ups will prove advantageous to banks as they will create brand new opportunities to
sell products, thereby preventing fin-tech startups and non-banking financial companies to
poach their customers from them. This can only be done if banks start taking cognizance of m-
commerce in the way it is galloping. (The Economic Times, 2015)
2016 saw a lot of new players entering the digital wallet field thus enabling traction in the m-
commerce space, fueling growth by enabling absolutely friction-free payments. However, this
opportunity doesn’t come risk-free. There is a lot of competition from technology companies
serving as banks. Then again, the problem of network failures can damage the brand of the
bank. Last and most importantly, hackers could get into the system and create fraudulent
transactions as well as data phishing thereby posing a huge risk to the customer’s money and
privacy. Yet, venturing into m-commerce space will prove advantageous to banks as it will
create new opportunities to sell products and creating unique value propositions for them.
Thus going by the current scenario, banks have no scope left to slow down in the transition to a
digital ecosystem. The government policies have made sure of it. Customer awareness has
increased with time and there will be a rise in demand for newer and more customized digital
products. The latest technologies will be employed as a strategic tool to fulfill this. This in turn
will differentiate the leaders from laggards and just how fast can they achieve the goal of
complete digitization thereby winning this race.
In terms of transaction volumes, the top five banks of India account for over 85% of all mobile
banking transactions. The same banks are toppers in transaction value as well, although the
rankings and consequent market shares vary slightly for volumes of transactions. State Bank of
India is leading the pack with a 38.5% market share, followed by ICICI Bank at 17.7%, Axis
(15.3%), HDFC Bank (9.9%) and Kotak Bank (4.3%). (Livemint, 2016)
4.3 Value propositions of m-commerce: Mobile apps and digital wallets

Mobile banking apps are the best tools for android and iOS smartphone users to check their
bank balance, download mini statement, detailed transaction statement, make online
transactions( through NEFT, RTGS online, IMPS Funds transfer) and also make donations by
sending money from one app to another.
Most Indian banks have now launched their mobile banking apps for android but some of them
are yet to make their apps compatible to the iPhone platform. For non-smartphone users, the
option of USSD over GSM is available. Some of the popular apps are as follows:
1. SBI – State Bank Anywhere 3. iMobile – ICICI Mobile Banking

2. HDFC Bank – Mobile Banking
37 | P a g e
4. BOI BTM – Bank of India Mobile 8. PNB mBanking
Banking 9. Allahabad Bank – Mobile Banking
5. Axis Mobile app
6. CANMOBILE – Canara Bank 10. Union Selfie & m Passbook – Union
7. M-Connect – Bank of Baroda Bank of India
All of these apps offer the basic features of SMS Banking, USSD Banking and Internet Banking
along with enabling the users to view balances, check mini statements, view cheque status and
transfer funds within the bank as well as other banks as well through IMPS (Immediate
Payment Services), perform mobile top ups, and use other m-commerce services along with
receiving alerts for mobile baking transactions and many more other such useful services.
Fig 4.5: Mobile wallets in India (Source: Livemint, 2016)
Moving on to the more important part of this m-commerce boom in banking and digital
payments sector, it’s time to talk about mobile wallets. The government's move to demonetize
Rs. 500 and Rs. 1,000 notes came as a bonanza for the digital payment solutions startups, as
38 | P a g e
they were beginning to see growth rates slump. However, with no cash, millions of Indians who
found cash safer than digital transactions, have now downloaded payment apps and have their
digital wallets full. (Sharma, 2015)
Surging numbers
Paytm, the largest Indian digital wallet with over 100 million users and 2 million transactions
per day, saw app downloads tripling and payments for offline transactions increasing by five
time in the first two days following demonetization. It had added one million new saved
credit/debit cards in the first two days - to refill the Paytm wallet.
MobiKwik, with around 35 million customers, saw 100% growth in customers daily in the past
few days. Chillr, another mobile payment app which has 2 million downloads promoted by
HDFC, has seen a growth of 30% in app usage and a 50% increase in downloads. The digital
wallet business of PayU, which has over 30 million consumers, saw its wallet downloads double
in two days. (Business Insider, 2016)
Going offline
Every digital payment solutions venture knows that the next big thing to focus on is on getting
people to use their solutions for offline transactions - and not just for online purchases. That's a
huge opportunity, provided online transactions still are a tiny proportion of the overall
transactions in India. If one walks into a McDonald's or a CCD or a Shopper's Stop these days,
one can therefore use a digital wallet on one’s phone for the transactions.
PayU is now present at around 15,000 merchant locations, now targeting even local kirana
stores. This is to change the fact that only about 500,000 of their 30 million customers transact
offline.
Freecharge again has seen a 10-fold rise in retail merchant sign-ups in the past few days, most
of them coming from grocery stores, pharmacies and food joints.
Harshil Mathur of Razorpay, a startup that was part of the prestigious Y Combinator Accelerator
says, "Many small businesses in India have websites, yet most of them, are mainly static,
present to provide information but not for transactions. Most never bothered to introduce
payment gateways, as it was expensive, till a few startups emerged in the space doing the
same." As of now Razorpay is inundated with requests from both offline and online merchants.
(Gupta, 2016)
Investor rush
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The recently launched Unified Payment Interface (UPI) has come as a boon to a lot. It is a
payment system that allows transactions between two bank accounts through a smartphone,
minus the trouble of entering details of credit card, or net banking passwords. A few wallets like
Mobikwik have already integrated UPI into their platform to provide more customized service
to their customers. This will bring down the cost of transactions, increasing the readiness of
merchants to go digital. (Joy, 2016)
Top 20 digital wallets in India: Unique Value Propositions
India saw a phenomenal increase in the number of digital wallets and is now steadily moving
towards being a cashless economy. With the transaction limit on digital wallets being increased
to INR 20,000, it has generated even more opportunities. So here are the top 20 wallets in
alphabetical order along with the propositions that they have to offer.
1) Airtel Money:
The Airtel Money app allows the users to easily recharge prepaid accounts and pay postpaid
bills. It also lets the users shop online by loading cash in the digital wallet. It’s offers extreme
safety by asking for a secret 4-digit mPin for every transaction or payment you make.
2) Citi MasterPass:
Citi MasterPass is a free digital wallet, which enables checking out while making online
shopping a speedier process. After having stored all your payment and shipping details in your
Citi Wallet, all you need to do is click on the MasterPass button which will take care of the
remaining transaction.
3) Citrus Pay:
One of the top e-wallets in India, Citrus Pay offers a wallet for customers as well as payment
solutions to businesses and corporates. Serving a strong base of over 800 million customers,
Citrus Pay holds a high spot as one of India’s best mobile wallets.
4) Ezetap:
Ezetap, is a Bangalore based digital payment solution, which offers business solutions to
corporates to accept card payments via electronic devices. Founded in 2011, it also sends e-
receipts to customers through an email or SMS.
5) Freecharge:
One of the biggest names in the Indian market right now, Freecharge has been known to target
the youth in all their promotions when it comes to offering digital payment solutions. It’s a
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great option to save while paying your bills online because it provides equivalent amount of
coupons for every recharge you make and cashbacks for every transaction carried out.
6) HDFC PayZapp:
PayZapp launched by HDFC makes digital payment simplified with one click payments, thus
being one of the top online wallets in the Indian market. It allows the users to compare flight
and hotel tickets, buy music and even pay bills using PayZapp. It just requires simply connecting
your debit/credit card once and then leave the rest to the app when it comes to making
payments.
7) ICICI Pockets:
This is one neat wallet app even when users might find a Pocket card redundant, considering
they are opting for an e-wallet app to avoid using a card. It’s a VISA powered app which can be
used on any Indian website to transfer money to not just email ids but also to WhatsApp
contacts, while also providing tap and pay feature to send money.
8) JioMoney:
JioMoney, recently launched in 2016 by Reliance Jio, is another digital payment app which
provides its users to receive great discounts and offers by making transactions via the app. It
helps in making shopping quicker than usual by letting the users bookmark their frequently
visited retailers.
9) Juspay:
JusPay Safe is a payment browser which has over 650+ transactions on a daily basis. It offers a
browser in which users can make card payments real quick with just 2 clicks.
10) LIME:
Axis Bank’s LIME, launched in 2015, is the first Indian mobile app to have integrated wallets,
payments, shopping, and banking. Other than the usual features of making payments, LIME also
helps you analyze your expenditure. It also provides the cool feature of rounding up all the
change and investing in a deposit along with a shared wallet tool. They definitely deserve a top
spot in the list of best Indian mobile wallets.
11) Mobikwik:
A Gurgaon based e-wallet payment system, Mobikwik is an Indian wallet that enables its users
store their money in the wallet. Founded in 2009, this digital wallet provides the features of
one tap recharges, payment of bills, and third-party purchases, to its users.
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12) MomoeXpress:
A Bangalore based digital wallet, MomoeXpress claims to have the fastest checkout system.
Despite being present only in Bangalore so far, it offers a wide range of solutions to the
Bangalorian residents. With over 3000 outlets available at the disposal of the users, they can do
a range of things from paying for their rickshaw rides to salons & spas.
13) MoneyonMobile:
A Reserve Bank of India authorized app, MoneyOnMobile enables users to purchase goods,
products, and services from registered merchants. Being a multilingual app, it has a reach in
remote areas of the country thus allowing millions of Indians to make online payments. It’s one
of the few apps to have such a wide reach.
14) Mswipe:
Founded in 2012, Mswipe is the first mobile point-of-sales solution in India. Instead of offering
an app, they provide a machine that can be attached to your mobile device to accept card
payments by swiping thus giving the name. It may not be a digital wallet app but it most
certainly is enabling India to become a cashless economy.
15) Ola Money:
Launched in 2015, Ola’s Ola Money is yet another popular digital wallet in India. Although it’s
mainly used to make payments for Ola cab rides, letting cashless traveling become a realized
dream, it is also used to buy groceries or flight tickets or make other payments online easily.
16) Oxigen:
Oxigen is a FinTech company that was founded in July 2004. It’s now one of the major providers
of digital payments in India. Besides allowing online purchases and bill payments, it also lets its
users send gift cards to their friends and family.
17) PayMate:
Founded in 2006 by Mr. Ajay Adiseshann, PayMate, in 2012, launched PayPOS, which is an app
that enables small business owners to send and receive payments conveniently via debit cards
and credit cards. It also lets them process electronic transactions swiftly.
18) Paytm:
Launched in 2010, Paytm is currently the largest mobile wallet app in India hands down.
Allowing both online and offline payments, Paytm is being accepted almost everywhere making
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it impossible to not switch to it completely. There’s almost nothing you can’t do with Paytm.
From paying mobile bills to buying movie tickets at great discounts, along with letting you shop
online, Paytm provides a one stop solution to all our needs.
19) PayUmoney:
PayUmoney is a part of PayU India. It’s a free payment gateway solution for merchants which
lets them collect payments from customers via debit/credit cards or net banking, and much
more than that. It offers SMS and email invoicing as well for the merchants who don’t have a
website for themselves.
20) State Bank Buddy:
State Bank of India’s product, State Bank Buddy, is an online Indian wallet available in 13
languages to all the users across the country. Non SBI account holders too can send money to
other bank accounts, book hotels or movie tickets and much more via Facebook thus offering
an untapped feature for other banking apps.
4.4 Mobile apps and digital wallets: A comparative study

App Wallet UPI Bank Transfer Android Ratings iOS Ratings
Transfer on App App
mobile
Airtel Money Yes No Yes Yes Link 4.2 Link 3
Axis Bank Lime Yes No No No Link 3.5 N/A N/A
BHIM App No Yes Yes Yes Link 4 N/A N/A
Chillr No Yes Yes Yes Link 4.4 Link 4
Citrus Pay Yes No No Yes Link 3.9 Link 4
Freecharge Yes No No No Link 4.3 Link 3.5
FTcash No Yes No Yes Link 3.9 N/A N/A
HDFC PayZapp No No No Yes Link 4 Link 2
ICICI Pockets Yes Yes Yes Yes Link 4.1 Link 3.5
Itzcash Yes No Yes Yes Link 4.4 Link N/A
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Jio Money Yes No No No Link 4.3 Link 3.5
Mobikwik Yes Yes Yes Yes Link 4.2 Link 4
mRupee Yes No No Yes Link 3.7 N/A N/A
Oxigen Wallet Yes No Yes Yes Link 3.7 Link 4
Paytm Yes No Yes Yes Link 4.4 Link 4.5
PhonePe No Yes Yes Yes Link 4.1 N/A N/A
SBI Buddy Yes No No Yes Link 3.9 Link 2
Trupay No Yes Yes Yes Link 4 Link 4.5
Vodafone M- Yes Yes Yes Yes Link 4.2 Link 4.5

Pesa
Table 4.1: Comparison of Mobile apps in banking and digital payments (Source: Gadgets360,
2016)
Unique Value Propositions on offer for the Top 8 apps:
o Banking Apps: Payment Gateways

o UPI: Security
o HDFC Chillr: Cashbacks
o PayTm: Bill Payments and retail
o Mobikwik: Online recharges
o Freecharge: Deals and offers
o Airtel Money: Convenience
o Oxigen Wallet: Versatility
Key Pointers to be considered
 For users new to mobile payments, two best options would be to mostly look at going
either with mobile wallets or banking apps that support UPI payments, depending upon
their requirements and options needed.
 RBI has increased the monthly balance limits for mobile wallets to Rs 20000 thus
increasing the scope and opportunities for them.
 Mobile wallets are digital instruments that let the users store money for instant
transactions. Money is loaded by transferring from one’s bank account via net banking
or credit/debit cards. Most wallets listed above are semi-closed wallets, meaning the
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user can transfer money to people who possess the same wallet, or make payments to
merchants authorised to accept money from that particular wallet.
 UPI or Unified Payment Interface, on the other hand, is a national electronic funds
transfer instrument that enables all bank account holders to send and receive money via
their smartphones without needing to enter their bank account information or the user
id/ password of net banking. It only requires the recipient’s mobile number or Virtual
Payment Address(VPA) and handles the rest.
 Other than the aforementioned apps, 31 banks including SBI & HDFC have their own UPI
apps.
 Most of the wallets also allow making payments without first adding money i.e., by
entering credit/debit card information. However, this would prove to be time
consuming in case payments are to be made frequently. In case you are not comfortable
storing your money in a 3rd party app, UPI serves as a faster means of transaction.
4.5 M-commerce in banking and digital payments: Challenges

 Recurring malfunctioning of the systems
The risk of unplanned system malfunction or a system shut down are always present. This is
because of the fact that the information of the digital wallets is stored on the cloud of these
business servers. So, in the case when the servers are busy or held up, processing the digital
payments becomes impossible due to high network traffic and therefore the business
operations tend to get help up.
 Technological challenges
With the booming technology and fast pace of innovation, there exist quite a few new
technologies to choose from including the NFC terminals, phone readers which out of the lot
are the most prevalent ones. The restriction with digital wallets is that they are necessarily
dependent on additional hardware for each application. In the present circumstances, NFC
terminals and specialized scanners are the only innovative daily use technologies that support
the processing of digital payments. Thus, the technology is still developing and is pretty new in
today’s time.
 Huge infrastructural investments
Since digital wallet is relatively an untouched field and is still evolving over time, the initial
infrastructural costs are gargantuan in proportions. The costs cover initial development of the
software and thereafter regular maintenance, malfunctioning fixes and regular updates.
Beyond the software, once it is made available, all the stores are required to install the
requisite hardware which further adds to the overall cost of the project.
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 Rising Security Concerns with mobile banking
It is the onus of the company to ensure safety of the customer data and thereby ensure the
encryption of the data to prevent it from miscreants. Perhaps, this poses as the biggest
challenge as most of the customers feel concerned about sharing their private data on digital
wallets siting safety concerns. Thus, it is upon companies to prove their adequacy and
preparedness to fight upcoming cyber challenges against potential security issues and thereby
market themselves. The following must be paid adequate heed:
1. The security threat of mobile banking is drastically less than internet banking, but still
security needs to be kept uptight. Mobile banking is subjected to ‘Smishing’, which is
exactly similar to ‘Phishing’ in internet banking. Herein, users receive fake messages
asking them about their bank details, to which many users falter.
2. The second major issue is that mobile banking isn’t available in all sorts of phone. Quite
a few number of times, an application needs to be installed to access the mobile
banking feature which is preinstalled in most upcoming smartphones. Therefore, the
usage of mobile banking heavily depends on whether the user has a smartphone or not
because transactions are only possible on high end smartphones.
3. Banks tends to additional levy up charges on the regular users for accessing their
services on a regular basis.
4. The functionality and appearance of a smartphone also directly impacts the usage of
mobile phones. The screen size, speed, battery size etc. all contribute to the smooth
functioning of mobile banking applications.
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5. SECTORAL STUDY- GROCERY RETAIL
commerce in the grocery retail and food services sector. We will be analyzing a number of
papers and reports on the given sector along with the data collected through primary research
to come up with the existing and emerging unique value propositions for each of these in the
area of m-commerce, their growth, potential opportunities and challenges in the way in order
to frame our recommendations at the end of this report.
5.1 Overview
The retail penetration in India has surged to 65 million unique visitors per month, therefore
leading to an annual CAGR of 55% as per the projections by Nielsen. This high growth has been
recorded across all available categories with highly impressive lead conversion rates. By
reaching out to 24 per cent online users, apparel has been the fastest growing subcategory in
retail. However, we are going to largely focus on grocery retail and food service and the variety
of models available under them to facilitate m-commerce. Mobile commerce has been
responsible for roughly 60-65% of the total e-commerce sales. Shopping online through smart
phones has proved to be a game changer, enabling industry leaders to believe that m-
commerce should be able to contribute up to 70 per cent of their revenues driven by e-
commerce (Prasad, 2016).
Food and non-alcoholic beverages account for 29 percent of total per capita consumer
expenditure with India being the sixth largest grocery market in the world and one of the
fastest growing markets for online grocery sales. With increasing participation of women in the
workforce, other key macroeconomic drivers are raising disposable incomes, high exposure to
western cuisine, and want for a wider choice of products than what’s typically available at
conventional mom-and-pop stores; a continued growth can be envisioned within the online
groceries sector and therefore m-commerce. (CII, 2016)
Giant online retailers, including Amazon India, have hopped in the fresh produce space after
achieving success in the packaged foods segment. According to internet industry analysts
reports, Amazon India had 23.6 million unique visitors in May 2015. Other than e-commerce
giants, leading Indian retailers like Future Group, Reliance, Godrej and the Aditya Birla groups
have stepped in to take their share of the pie as well. Godrej’s gourmet food chain has tied up
with e-grocer EkStop for better logistics support and to reach a wider consumer base where
they do not have retail outlets and this is being done via mobile. Some other leading Indian
players include BigBasket, LocalBanya etc. who have received FDI to expand their operations to
penetrate deeper into tier-2 and tier-3 cities to gain a wider consumer base and greater market
share. (CII, 2016)
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Fig 5.1: Market size of organized grocery retail in India (Technopak, 2016)
The latest entrants like Peppertap and Grofers use mobile phone applications to handle
deliveries for online orders by linking consumers to local stores, along with independent mom-
and-pop shops as well. The quick service and casual dining restaurant sector have also been
gaining momentum in the metro cities especially. Here, restaurants have a tie-up with online
portals like Swiggy to provide consumers with a choice of restaurants under one roof. They
provide first hand review and feedback to consumers that have been written by other
customers on the listed restaurants and the menu items so that they can have a feedback of
what they are ordering. These portals also provide convenient payment options of net banking,
credit or debit card and cash-on-delivery. Ordering food online is becoming increasingly popular
among consumers as they can place orders and have food delivered to their door step at their
preferred time and, occasionally, at discounted rates. (Jashnani, 2015)

Secured by protective government policies, millions of small “mom-and-pop” ventures that
dominate India’s $350bn food and grocery retail industry face very little real competition so far,
despite the tantalizing potential of the market.
There’s a ban on foreign supermarket chains. Large conglomerates such as Reliance and the
Tata Group owning domestic grocery chains, have been stymied by their high cost and a lack of
suitable retail estate.
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Over the past three years, the changing Indian consumers — millennials who normally had to
run from one tiny store to another or visit multiple markets to buy everything on their grocery
list — now have newer, more convenient options. There has been more than a sprouting of
Indian online grocery shopping start-ups that have been using technology to bring convenience
and a greater variety of products to shoppers in terms of choice and quality. (Livemint, 2016)
Bangalore based Big Basket, has built an online supermarket model complete with back-end
warehouses, a private label, inventory of stock, and fleets of delivery vans for logistics support.
It operates in 18 cities currently.
Nowadays, India is witnessing the rise of several asset-light grocery delivery companies
following the “hyper-local delivery services” model— that operate on tech platforms that
piggyback on existing brick-and-mortar stores, along with mom-and-pop shops, facilitating
online shopping in a far more convenient manner.
However, the fledgling online grocery sector of India is already feeling slightly shaken. Hyper-
local delivery services apps such as Grofers and Peppertap, offering online order and delivery to
customers, backed by investors including US-based Tiger Global, Japan’s SoftBank, and Sequoia
Capital, are retrenching, stopping operations in several cities where they had recently started
owing to lack of capital and logistics. LocalBanya, another major player, shut down in October.
(Financial Times, 2016)
Amidst all this chaos, Big Basket, however, is expanding. Abraaj Group, the Dubai-based private
equity house, its parent company, raised $150m recently in a fundraising round bringing Big
Basket’s total fundraising to about $235m, and making it a $500m company in terms of
valuation.
According to Hari Menon, the CEO and co-founder of Big Basket, “Investors are now clearly
looking at whether the models are profitable, and profitable at scale. Funding has dried up for
people who don’t demonstrate that.” (Business Insider, 2016)
Fig 5.2: Funds raised by various Indian online grocery businesses (Source: Morgan Stanley, 2016)
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Big Basket is going to start operations in seven additional cities, in the upcoming days, bringing
its total to 25 cities, up from when it first began operations. They are also planning to pause its
geographical expansion for the time being to focus more on boosting sales in the cities where
they currently operate building a competitive advantage there and maximize revenues instead
of spreading themselves thin.
During 2015, Big Basket sold groceries worth $119m year increasing that to nearly $300m last
year, and expecting an increase to $1bn in 2017.
In many western countries, online grocery shopping has had an unsteady growth rate, where
large, sophisticated supermarkets and small convenience stores together put up a dizzying
array of products within the reach of consumers. Yet, India’s stunted supermarkets still provide
online shopping a much greater appeal to shoppers who spend more than half of total retail
spending on food and grocery items as compared to others. (CII, 2016)
As per Omar Lodhi, Abraaj’s head of Asia, “India is currently at a very nascent stage of
evolution. It is yet to have a well-developed modern retail. Counting this factor in, there’s an
immense opportunity for online grocery to leapfrog to great heights in terms of product
delivery and overall shopping experience for the customer. ”
If analysts are to be believed, the hyper-local delivery business model is struggling because it’s
largely dependent on the traditional mom-and-pop stores, thereby lacking sufficient inventory
and warehousing capabilities and exhibiting an erratic availability of goods with them, affecting
their revenues and profit margins adversely as a result. Such retailers therefore are unable to
offer significant discounts to their consumers, and thus incompetent in making enough money
for themselves. (Menon, 2016)
There is sufficient room for substantial disruption in the current supermarket space which is
highly inefficient as of now. This model is inherently flawed if we observe closely. That’s
because when we talk about the last mile delivery, it’s cost addition and not cost cutting. No
single supermarket in India can carry a full assortment of all the products in demand, so in
order to fulfil any order for a shopping basket, the hyper-local delivery guy has to visit at least
five or six shops to get all the products ordered thereby piling up the cost and increasing the
time of delivery. (Technopak, 2016)
The weaknesses of this model become even more pronounced when it comes to fresh produce,
which is what’s demanded the most by customers, often carried by the very same delivery guys
who handle the other grocery items. Now scientifically speaking, one can’t expect the same
young biker to go and choose the right potato or onion from a superstore. He lacks the skill set
required to do so. (Menon, 2016)
Even the larger Indian companies working in the m-commerce and e-commerce space, such as
Flipkart and PayTM, which operate on a marketplace model and even the taxi-hailing app Ola,
have tried experimenting with selling groceries. But if we look at the current scenario, only
Amazon’s KiranaNow is still running a service till date, and that too is limited to operating in just
a single city, which is Bangalore. However, they do plan to expand their operations.
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The BJP government, after coming into power has also permitted foreign investors to set up
retailing businesses in India as a part of the ‘Make in India’ initiative, asking them to sell India-
made food, and generate employment for the people here. Even the domestic brick-and-mortar
grocery chains of the country are being pushed into online sales and entering the m-commerce
space.
Despite the rapid growth and lowered barriers for entry of new rivals, the companies haven’t
grown complacent. They are continuously raising investments from foreign investors and could
pivot to following inventory led models instead.
It’s just a matter of time when the physical businesses decide to go online and that’s when the
real challenge will arise for all the players. (Menon, 2016)
Drive towards the hyperlocal model
As time passes, we are expecting the ecosystem to slowly transition to the upper left section of
our current target market i.e. as companies decide to go hyperlocal-mobile only and enter the
m-commerce space completely in a full-fledged manner. The few main factors driving this
growth right now are:
1) India has become a mobile-first country,

2) It has gone cashless with the advent of demonetization, and
3) Outside of Tier 1 and 2 cities, a sizeable amount of commerce is still happening offline
which is set to change in the upcoming years.
If the Indian companies want to tap this massive market growth opportunity to its full potential,
they need to develop effective strategies now so that they can enhance the offline world with
the use of mobile phones, and enhance the m-commerce space offline. Business models such as
that of Lenskart and Pepperfry, are now opening up actual tangible ‘experience centers’ where
the customers may touch-and-feel the products offering a physical experience surrounded by
the personal service experience of brick-and-mortar stores to supplement their mobile
commerce experience thus leveraging the opportunity both ways. In these offline
environments, harnessing the mobile devices can open up a huge can of possibilities, which
may range from tailored in-store recommendations customized for the customers based on
their online preferences, social sharing among peers, frictionless checkout and payments, and
much more. (Potharaju, 2016)
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Fig 5.3: The various segments of grocery retail percentage wise (Source: PWC report, 2016)
This change is already being witnessed in many other cases, in the form of aggregating offline
vendors, products, deals, and offers that are available in close vicinity. It has already given rise
to location-based deal aggregators, leading to an ever rising craze in food-tech and social
discovery platforms that is filling the majority of the hyperlocal column on our map. This whole
phenomenon of aggregating business offline via mobile commerce would allow a business to
layer mobile technology on top of the existing framework model of offline commerce, hopefully
earning a profit from it gradually.
In the grocery retail ecosystem dominated by new investments, acquisitions, and partnerships
happening seemingly every week, a rapid reorganization of Indian mobile commerce in this
sector is set to happen in the coming days. There are many questions: Can hyperlocal model
turn hyper-profitable? Will there be a consolidation of the smaller players, or a fragmentation
of the larger ones or a middle ground? Will the established ecommerce Goliaths make a
successful and inevitable transition to hyperlocal model before the new generation of emerging
mobile-first companies does, or will both of them coexist? Answers to all these questions and
more now lie in the palm of the consumers’ hands. (Noones, 2016)
Recent Shake-ups in the industry
India’s top 10 food retailers, accounting for about 40% of the organized retail sector’s revenue
had total accumulated losses at Rs.13,000 crore in 2013-14 on a revenue of approximately
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Rs.23,500 crore. By 2016-17, these losses have peaked to Rs.17,000 crore as revenue has
reached Rs.32,000-35,000 crore.
With the twin benefits of an optimized operating model and a scaled up size kicking in, it has
been analyzed that at least half of the retailers will break-even overcoming the shake ups.
However, we need to consider the fact that no other retail vertical (be it apparel, or consumer
durables or footwear) has witnessed a hemorrhaging of this magnitude. The paradox remains,
whether to recover the monies lost, or to continue expanding to more cities. This is because of
the wafer-thin net margins of 2% to 2.5% in the business which is a continued challenge for the
sector, the solution of which is yet to be found. (Crisil, 2017)
Such high losses happened because these retail businesses were still in their gestation period
when they decided to undertake the process of carrying out large-scale expansions, as per the
report by Crisil.
Aditya Birla Retail Ltd, Heritage Foods (India) Ltd, Bharti Retail Ltd, HyperCITY Retail (India) Ltd,
METRO Cash & Carry India Pvt. Ltd, Max Hypermarket India Pvt. Ltd, Reliance Fresh Ltd,
Spencer’s Retail Ltd, Wal-Mart India Pvt. Ltd, and Trent Hypermarket Ltd are among the top 10
food and grocery retailers in the gestation period. Crisil’s report, however, does not include
profitable retailers such as Future Value Retail Ltd (Future Value) and DMart retail chain
operated by Avenue Supermarts Ltd.
The new government after coming in has been appearing keen to open up multi-brand retail
stores to foreign direct investment improving the competition in the market and thereby
pushing the quality and scaling up of businesses. These retailers will also be kept going because
of the backing provided by intrepid promoters who are ready to add skin to the game as they
see immense potential of growth in India owing to the supportive government policies. (Crisil,
2015 )
As of March 2014, it was estimated that these retailers have invested approximately Rs.19, 000
crore in funding losses through direct equity infusions, opening up new stores in more
locations, and getting loans from banks and promoters. After the passage of around 3 fiscal
years, these investments have continued and will increasingly help in multiplying the revenues.
Accounting for over 69% of the overall market, food and groceries retail continues to be the
largest segment of the Rs.25.3 trillion market in the retail segment. But if we talk about the
market penetration of organized food retail, it is just around 2%. This therefore provides a huge
opportunity for growth. In comparison to this, the penetration of consumer durables is 27%,
18% each for footwear and apparel, and 14% for jewelry.
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Retailers have been taking several initiatives, to stem losses, but they will be able to yield
results gradually. Most firms are simply trying to increase their profit margins by getting their
store size right. They are working on shuffling and redesigning their portfolios to offer a larger
variety of products to the consumers at the right price points. (Business Insider, 2016)
According to Mark Ashman, the CEO of HyperCITY, “Over the past three years and a half, we
have been looking at reducing our store sizes to cut our losses, thereby opening smaller stores
and focusing on increasing our revenues and profit margins through high margin segments such
as apparel. This should help them in breaking even at the company level in the second half of
the business year.” (Livemint, 2016)
5.3 Value propositions of m-commerce: Grocery retail apps

In the recent years, India has witnessed a great revolution in the online shopping experience
and the subsequent development in the m-commerce space, to an extent where budding
entrepreneurs and established business magnates alike are looking towards a great diversion of
grocery retail, trying to make money out of shopping for groceries and items for daily home
needs by focusing on making life simpler and easier for the consumers.
The focus of online grocery shopping lies on availability of fresh products and speedy delivery
while not compromising with the quality of the products, thus, making the segment highly
competitive. This is a mutually beneficial business for both the customers and the retailers if
they use the correct strategies. These shopping destinations provide great deals and discounts
to appease the customers. As of now, a majority of these online grocery stores operating on
mobile apps mainly are offering their service only in a select few cities comprising of Delhi-NCR,
Pune, Mumbai, Bangalore, Kolkata, & Hyderabad.
Key Players in the market and their unique value propositions
Fig 5.4: Funds raised by online grocery groups in India (Source: The Hindu, 2016)
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The mobile technology is being leveraged by these apps to make shopping of these daily
commodities and their delivery simpler and more convenient through mobile apps. This is
probably one of the best uses of m-commerce as it’s focusing on the ease of an urban Indian
customer’s day-to-day life where the strenuous 9-6 working hours are tiring and leave the
customers in no mood for conducting any other household activity including shopping for
vegetables and grocery. These online grocery shopping and delivery apps have emerged as the
best possible solutions to this extremely tedious daily requirement, thus growing in popularity
by the hour, turning it into a high growth potential and fast-growing niche segment which is
being tapped by established brands like BigBasket through their mobile applications available
for android, iOS and Windows. Amazon Now and Ola Store are the latest entrants in this m-
commerce space for grocery retail. Following is a list of the top online grocery shopping and
delivery mobile apps in India responsible for bringing fresh merchandise from supermarkets to
our doorsteps in a jiffy.
1) BigBasket
One of the top grocery shopping and delivery mobile applications in India, BigBasket.com, is a
high-grossing pioneer in the online shopping for grocery and vegetables space, thus
revolutionizing the traditional way in which urban Indians shop for the household items, fruits,
vegetables, and grocery up until now. Using the BigBasket mobile app on one’s Android or iOS
or Windows smartphone, one can shop for the products anytime and get it delivered at your
doorstep anytime from 7 am till 10 pm as per the slots you can select of your own accord.
BigBasket operates across cities including Hyderabad, Bangalore, Mysore, Vadodara, Delhi,
Chennai, Mumbai, Vijayawada, Coimbatore, Pune, Lucknow, Ahmedabad, Madurai, Nasik, and
Mysore. Its mobile app provides easy access to the customers to merchandise consisting 18,000
products from 1000 brands ranging in different categories across the brands.
2) ZopNow
ZopNow, having been founded in 2011, is among the most popular online grocery shopping and
product delivery apps in India. The target audience of ZopNow includes professional on-the-go
customers who don’t have time to perform household chores. Known for an extremely user-
friendly interface, ZopNow has one mission, to let its customers “be lazy, and buy easy.”
Operating across Mumbai, Hyderabad, Pune, Thane, Bangalore, and Gurgaon, ZopNow claims
to deliver the orders within 3 hours of their placement at the registered addresses across within
these cities. The biggest advantage of ZopNow app, which also serves as its USP is that there is
no minimum order value for getting free delivery at one’s doorstep. In addition to this, ZopNow
also offers a discount of INR 100/- on the first order placed by a customer if the order value
exceeds INR 1000/-. It also allows customers to go through the history of past orders placed by
them.
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3) Grofers
It’s is an on-demand grocery shopping and delivery mobile app in the online grocery retail
segment operating on the hyperlocal model. The mobile app of Grofers provides access to an
m- commerce platform where there’s a listing of all the grocery stores selling food items,
cooking ingredients, packaged food, vegetables and fruits. Customers can choose from a range
of these products and expect delivery of orders within 90 minutes of placing the order
depending on the time of the day. Grofers as of now is a one-stop shop for online grocery
shopping growing at a fast pace.
4) VEGGYKART
It’s a relatively new entrant in the online grocery shopping market in India operating in the m-
commerce sector through mobile app. It’s available freely for all its customers to download on
all mobile platforms viz. windows, android and iOS. It offers great discounts on every single
purchase, and there’s no limitation on the percentage of discounts. The discounts vary based
on the size and value of placed orders. Customers also get free home delivery in addition to this
thus making it a popular choice among them. VEGGYKART is currently operating in Gurgaon,
and is planning on expanding its services to a few more major cities in the country. Delivering
fresh grocery items, fruits and vegetables is its topmost priority just like most other apps
operating in this category.
5) AaramShop
For grocery shopping via Android and iOS platforms on smartphones, AaramShop is a one-stop
access solution to a large number of retail stores available via shops backed by AaramShop.
Through the mobile app, customers have a choice to shop from the nearest store of AaramShop
based on where they are located in the major cities of India. AaramShop serves as a hybrid
retail platform that’s growing at a fast pace by collaborating with FMCG stores and brick &
mortar grocery thus making the life of an urban Indian much easier by delivering a range of
products in various categories of packaged food items and raw food materials alike to the
doorsteps of consumers.
6) PepperTap
PepperTap started its operations in the online grocery shopping and delivery segment in 2014.
Founded by Milind Sharma and Navneet Singh, PepperTap allows free download of its app for
all three smartphone platforms, making online grocery shopping and delivery easily available in
the areas in and around Delhi NCR as of now. The key value propositions offered by PepperTap
application are its efficient order placements and agile delivery of fresh products. It’s currently
on hold as it lost grounds on expansion.
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7) Nature Basket
Nature Basket, an initiative of Godrej is a chain of grocery stores spread across the country,
accessible online to all the consumers through its website as well as mobile application.
Available to download for free on Windows, Android, and iOS devices, Godrej’s Nature Basket
app is responsible for delivering orders from the stores of Godrej’s Nature Basket. This app
allows the users to shop for items which are not available usually in the normal supermarkets
and stores by shopping online. The Nature Basket app also provides access to the users to a
catalogue of over 17000 products across different brands. For orders over 1000 rupees, the
option of free delivery is available. It provides 5 delivery slots per day with a gap of 3 hours in
between every 2 slots.
8) Amazon Now
An extension of Amazon’s India subsidiary, Amazon Now, is the latest entrant in the online
grocery shopping market of India. The Amazon Now app has only been recently launched for
online grocery shopping and delivery at the doorsteps of the customers and is currently
available only in Bangalore City to Android smartphone users. It works in partnership with
Reliance Fresh, Big Bazaar, Godrej Nature Basket, Kirana Now, Good Food, Food World, and
other grocery retail stores in order to make merchandise containing daily essentials available
for purchase and delivery to customers through its android mobile application. Amazon Now
has the options of free Express delivery i.e. delivery within two hours and Scheduled delivery
i.e. delivery within the same day as a part of its ongoing promotion.
9) Naturally Yours
Naturally Yours, founded in 2010, by Priya Prakash and Vinod Kumar, is the first online portal of
its own kind designed for shopping of completely organic food products online in India. Being
headquartered in Mumbai city, Naturally Yours began its operations with a brick & mortar store
and then expanded its operations by offering merchandise online through its smartphone app.
The app is available for free download on iOS and Android mobile devices. Naturally Yours
offers its organic food products to consumers in several states across the country. The app of
Naturally Yours also provides its users access to multiple rewards on orders, the latest store
headlines and many other such facilities.
10) LocalBanya
Another free mobile application for online shopping and home delivery of groceries, LocalBanya
requires the minimum order value to be Rs.500 in case a customer wishes to avail free home
delivery. For an order value below Rs.500, the delivery charges are Rs.50 per order. The
locations in which it’s currently operating are Hyderabad, Mumbai, Delhi/NCR, Gurgaon,
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Ghaziabad, Noida and Pune. LocalBanya is among the fast growing portals for online grocery
shopping and is expected to give a very tough competition to BigBasket app.
With a merchandize of over 14,000 products available on LocalBanya, it is gradually turning into
one of the biggest premium online convenience stores which has revolutionized the entire
grocery shopping experience completely. A customer simply needs to place his desired order on
the mobile application of LocalBanya on his smartphone by opening the app and browsing
through its well-stocked aisles by looking through the different categories such as Vegetables
and Fruits, Gourmet and International, Staples and Groceries, etc. and then place the order by
selecting the desired time slot.
5.4 Grocery Retail Apps: A comparative study

App Mobile Website Shipping Android Ratings iOS App Ratings
App Charges App
Big Yes Yes Yes Link 4.2 Link 4
Basket
ZopNow Yes Yes No Link 3.6 Link 3.8
Grofers Yes Yes Yes Link 4.1 Link 4.2
Aaraam Yes Yes Yes Link 3.6 NA NA

Shop
Local Yes Under Yes Temporarily NA Temporarily NA

Banya renovation out of order out of order
Nature’s Yes Yes Yes Link 3.7 Link 3.8

Basket
Reliance Yes Yes Yes Link 3.3 Link 3

Fresh
Direct
Naturally Yes Yes Yes Link 3.3 Link NA

Yours
Amazon Yes Yes Yes Link 3.8 NA NA

Now
Table 5.1: Comparison of Mobile apps in online grocery retail sector (Source: Gadgets360, 2016)
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o BigBasket: Variety
o Local Banya: Pricing
o ZopNow: Discounts
o Nature’s Basket: Quality
o Grofers: Prompt delivery
o PepperTap: Deals and offers
o Reliance Fresh Direct: Payment Gateway
o Aaram Shop: Convenience
Key Pointers to be considered
 The greatest advantage of using mobile apps for ordering groceries online lies in the fact
that a customer can browse the multiple shopping aisles available on the virtual stores
24/7 anywhere without even leaving the comfort of his couch. Some emerging apps also
have an online assistant as a part of customer service support who is able to provide
automated answers to the most frequently asked questions. This is an upcoming trend
among the topmost grocery apps where online chat facilities are provided to allow a
user to interact with a real person thus enhancing the shopping experience.
 Online Shopping means a complete avoidance of queuing at the checkout counters for
payment, no more parking hassles space in the shopping mall parking area as one looks
for parking a vehicle and no more negotiations with the in-store staff while shopping
during peak times.
 A con to this is that one needs to be confident while navigating online for shopping.
Some online grocery store apps are poorly designed and might make it difficult to search
for a specific item for the uninitiated. As a remedial measure, these virtual stores are
responding actively to consumer feedback and relevant improvements are being
consistently made to their apps on a continuous basis.
 Delivery charges are generally always there and may even be higher for peak times and
the busier delivery slots, such as weekends. Slots may also be pre-booked in advance for
popular public holidays such as Diwali or Republic day.
5.5 M-commerce in online grocery retail: Challenges

Originally focused at a localized area addressing a small community, internet based grocery
startups were launched to simplify life and ease our day to day concerns. To maximize their
market share, online grocers aced rapid expansion paying practically no heed to market
acceptance, profitability in the cities and marginal economics. Albeit, from scratch to
completion the process seemed easy and devoid of any real issues, but off late, it has come to
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light that online grocery startups, especially in India, have been facing grave issues in smooth
running of operations and efficient functioning.
Enlisted below are few prominent issues faced by online grocery stores:
 Homemakers aren’t adequately equipped technically
In Indian households, the prime chunk of shopping is done by housewives who generally lack
technical prowess. Homemakers are known to cringe at the idea of using mobile applications,
comparing prices online etc. They’ve always preferred the idea of buying groceries in-person as
it avoids them the fear of the unknown and provides them an opportunity to bargain first hand
which gives them immense joy.
 Negligible gross margins
The margins in online grocery business are really thin ranging from 5% to 7% generally. In
generality, for order values less than Rs. 500, when no delivery charges are imposed, the online
grocery stores tend to register a loss of a minimum of Rs. 25, let alone profits.
Online stores operate at a negative margin per delivery and therefore, profitability seems to be
a distant dream; atleast two to three years in reckoning (Navneet Singh, CEO, PepperTap)
 Displaced focus on horizontal expansion instead of vertical one
The priorities of online grocery startups are out of sorts in the sense that the prime focus of
these startups has been on expanding in as many cities as possible due to increasing
competition. This has led to indiscriminate utilization of venture capitalist’s funds. Also, in
extreme cases, a lot of startups had to withdraw their operations at a later point in time.
For instance, even an established online grocery store such as Grofers had to withdraw their
operations from 9 cities including Vishakhapatnam, Rajkot, Nasik, Kochi, Coimbatore, Bhopal,
Ludhiana and Bhubaneshwar after registering major losses.
 Ever increasing market costs
At the onset of a business, any online grocery store looks on achieving two goals to sustain their
business, namely:
1. Establishing a comprehensive and efficient service mechanism thereby developing

customer satisfaction.
2. Make ingressions in the age-old offline shopping tradition of the Indian citizens by
creating a demand for online grocery retail, thereby increasing sales.
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In the context, to accomplish these over time, online grocery stores tend to invest extensively
in marketing activities, advertising, promotional campaigns etc. thereby forcing the drastic cut
in profits and eventually leading to losses. There have been instances wherein some online
grocery applications went one step forward by offering money to retailers to collaborate with
them, which further increased the burn on their pockets. Added to that, ad campaigns such as
the one by Big Basket wherein they roped in Bollywood star Shahrukh Khan, further increases
the expenses.
 Hesitancy and unwillingness of the customers to pay the delivery charges
It is pertinent to take this into cognizance that almost all online grocery stores are giving up free
home delivery for order values less than Rs. 500 except a few such as Big Basket, Top Tomato,
My Grahak etc. wherein the free home delivery commences for order values beyond Rs, 1000.
At times, when the purchase amount is small, the customers are highly hesitant and unwilling
to pay the delivery fee and therefore tend to buy the entire list of grocery items from the local
grocery store. Moreover, there are no constant delivery charges for even prices less than Rs.
500 or Rs. 1000, which further adds insult to the injury as the customer is not sure about the
excess amount that is going to be levied on them post checkout.
It is for certain that the shopping behavior of most customers is bound to be multi-channel,
although, their habit of buying from local grocery stores while standing in long queues
continues to remain the biggest challenge (Vijay Singh, MD and CEO, Aaramshop).
 Unseen challenges in training of workforce and efficient operations
For a business to run successfully the workforce needs to be the at their toes at all points in
time. It is no hidden knowledge that an online grocery store business depends heavily on the
feet-on-the street. Therefore, recruiting and training the delivery boys, handling of the cash
coupled with handling of perishable goods, post processing wastage, return of products etc. are
perhaps the most important facets for an effective business model. Inefficient handling adds to
superfluous costs and additional burning of funds.
Added to this issue is the repulsion of local retailers for usage of applications. They do not
intend to adapt to these technological changes. Most of the local retailers are skeptical about
the usage of these applications (Saurabh Singla, Co-founder, LazyLad).
Taking the above factors into consideration, it is pretty much evident that running an online
grocery startup is not even close to being an easy task. The only factor favoring promotion of
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online grocery sale is that it adds to the ease and makes it all the more comfortable for the
customers in comparison to the conventional way.
In times to come, if things work positively for in online grocery startups then India has the
potential of becoming a global superpower in this domain.
 Infrastructural Constraints
The models followed by online grocery stores vary widely. There are few companies that have
their own stores while others tend to tie up with localized mom and pop stores. Companies
such as Big Basket that have their own offline stores practice complete control over their
business which helps them in maintaining complete quality control, meet high sudden
demands, achieve economies of scale in the long run etc. Gargantuan proportions of funds are
diverted towards transportation of goods from one place to another and therefore
infrastructure controls a major chunk of the total funds of a company.
 Inability of online grocery startups in penetrating backward rural stores and small towns
While shopping, often do we hear women bargaining, “Neither yours, nor mine, lets fix the
price as Rs. 25/kg”
Rural areas especially lack sources of entertainment and so shopping in Vegetable markets
becomes one of the most precious moments in a housewives’ daily routine. It is here, that
these women tend to learn the art of bargaining and imbibe it as their hobby.
Added to that, markets in small towns and rural areas are relatively closer to place of
accommodation and therefore successful spearheading by online grocery stores becomes all
the more difficult.
 The question is: Is it competition that is the driving impetus?
Well, competition is one of the most crucial factors that drives online grocery startups. Fickle
minded customers keep hopping from one application to another and finally select the one that
offers them the best deal. Therefore, the online grocery stores have to heavily focus on their
competitor’s strategies ad expect their next probable moves.
For upcoming online grocery startups, the point of competition are the pre-existent online
grocery stores, local vendors and the wandering push kart. This kart has a special feature of
delivering fresh fruits and vegetables at the door step at the same cost without any additional
delivery charges.
 Would it be correct to say that grocery startups are offering a complete solution?
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With the wide variety of brands and products present in the market today, maintaining stock of
all items at all times becomes impossible for any retailer. Whether it is unavailability of brand or
the unavailability of the product, in both the cases, the online grocery stores suffer heavily due
to loss of customer loyalty. And in such cases, they rush to nearest grocery store that is known
to keep these brands/products.
 Discount being availed by retailers instead of the target customers.
There exists a margin of four to five percent in many products such as butter and milk but in
cases when a discount offer is being run of close to twenty percent through an application,
retailers themselves start buying these products through the applications and start stocking
them as daily stocks.
 Inefficient inventory management
There are startups such as Big Basket that opt for inventory led model. This model has its own
sets of advantages and disadvantages. Herein, the company gets complete authority over the
products and their storage in the warehouses but at the same time they spent excessively on
the rent of the warehouse, storage maintenance charges etc.
 Freshness of fruits and vegetables
Every customer wants the best quality of fruits and vegetables, especially so, when they pay
high amount of money in return or are being charged delivery charges.
The tests for each variety of fruits and vegetables are generally defined and very localized such
as pricking them, smelling them etc. Since, there exists no defined permanent way to check the
quality of the fruit or vegetable beforehand, late delivery, delivering rotten fruits etc. should be
avoided at all costs by online grocery startups to prevent customer displeasure and thereby
turnover to some other online grocery store of their local vendor.
 Tracking the buying behavior of the customers and classifying them on that basis
On the basis of liking of one individual for a particular product, is it alright to generalize the
product to everyone’s liking? No, we certainly cannot. Even the liking of that particular
individual for that particular product is not certain for eternity. He might shift over the product
when he gets saturated form that product.
In the context of the above argument, if a customer is getting things available at his home he
would not go outside to buy them for no reason what so ever. He might extend the concept to
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go out and fetch only if he recognizes a handful of products that aren’t available and not go out
when just one product is not available at his place.
 Loyalty of the customers
This is perhaps the biggest challenge in online grocery sale. There exist so many companies
because of which the competition has gone beyond bounds. Every now and then a different
company offers better deals for the same products and therefore, it is practically impossible for
a company to develop customer loyalty and create permanent customers even with recurring
discounts and better schemes.
Over time, Indian users have also evolved. They tend to order from different mobile numbers to
continue to avail the 20% discount that is offered to new customers. Therefore, beyond a point,
even the company is not willing to bear the brunt of the added weight of repeated discounts.
So, it has become extremely difficult for online grocery stores to develop and maintain
customer loyalty.
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6. SECTORAL STUDY- TRAVEL & TOURISM
commerce in the travel and tourism sector. We will be analyzing a number of papers and
reports on the given sector along with the data collected through primary research to come up
with the existing and emerging unique value propositions for each of these in the area of m-
commerce, their growth, potential opportunities and challenges in the way in order to frame
our recommendations at the end of this report.
6.1 Overview
Tourism in India is a rapidly growing and a highly significant commercial sector for India,
accounting for over 7% of the nation’s GDP and supporting over 40 million jobs. According to
the World Travel and Tourism Council (WTTC), this sector is growing at an average annual rate
of 8%. Online travel has evolved to dominate the country’s travel market with a CAGR 0f 17.8%
outperforming the overall travel market by 6 points. (Aranca, 2016)
Fig 6.1: Indian Travel Industry breakup (Phocuswright, 2014)
Over the last decade, there has been a drastic evolution in the Indian travel industry where air
and rail dominate along with the fragmented hotel industry and evolution of travel aggregation
apps. With everyone being connected online via mobile phones, a phenomenal adoption can be
foreseen by businesses in technology in order to transform them in the sector and keep pace
with the target audience. Among the top trends, cloud computing is definitely going to be a
natural evolution in the industry with cloud servers now being physically located in India over
different platforms. (Goodworks, 2015)
In addition to this, Social Media Marketing because of the high accessibility of various social
media platforms to the users via smartphones is also receiving a lot of interest by businesses in
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this area. The biggest reason behind this special focus on this segment is that social media is
now considered the best way to reach out to the public, to analyze what they are interested in
and to have a more focused targeting. Businesses are conversing, taking suggestions, asking for
feedbacks, and running marketing campaigns dedicated to social media in order to develop a
rapport with the audience and widen their reach thus improving the loyalty of their customers
as well. (Kant et al., 2016)
Mobile innovation is the key driving aspect amidst this entire online evolution. Companies are
continually looking at more innovative ways of engaging with their customers through their
personal devices to improve the market research insights. Mobile phones have already become
the preferred choice of customers to access the portals for online travel services and will
continue to dominate the discovery and transaction space in the coming years. Smartphones
also provide a medium for online travel companies to build engaging services to increase and
improve customer interaction while they are traveling to provide customized and personalized
innovative services, which isn’t possible in any other way.
Fig 6.2: Key online travel agencies (MMT investor presentation, 2014)
It is safe to say that the next big trend would be the emergence of early stage IoT based
services for travel, especially for traveler security which is a huge concern for customers and
personalization of services based on it. (Doda, 2015)

The travel and tourism sector in India, comprises of both international travel (accounting for
15%), and domestic travel (accounting for 85% of the travel and tourism market). This sector is
estimated to grow at a 12% CAGR YoY from a $19.7 billion industry in 2013 to a $27.5 billion
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industry in 2016. At 39% share of the market, the biggest contributor to this sector is air travel
(both domestic as well as international), closely followed by hotels (at 30%) and rail travel (at
28%). With a 12% growth rate, the Indian travel and tourism industry is the world’s second
fastest growing market in the sector, after China, with a CAGR of 16%. On the contrary, the US
travel and tourism industry is growing at a rate of 6%, and the overall global market is growing
at just a growth rate of 4% for the same yearly basis. (Aranca, 2016)
 This strong surge in the domestic travel and tourism is driven by the following factors:
 The increasing purchase power parity of Indian middle class
 Increasing penetration of smartphones and the Internet, along with an

increasing penetration of e-Commerce/ m-commerce
 Improved rail, road and air connectivity between Tier-1 and the rest of the cities
 Improving comfort and convenience seeking lifestyles owing to a transition to

westernization
Fig 6.3: Consumer division for Indian Travel Industry (Octane research, 2015)
 Along with the domestic travel, there has also been a surge in the number of inbound
international travelers visiting India, driven by the following key factors:
 Comparatively more economical vacations with respect to other tourist

destinations
 Evolution of leisure as well as business destinations in India
 Multiple policy reforms in the Indian aviation sector boosting air connectivity
internationally
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 More socio-economic sections in the country opening up to foreign direct
investments and private investments
 Several focused initiatives by the government in states such as Rajasthan, Kerala,

and Gujarat for the promotion of tourism
 Resounding success of Indian tourism’s international campaigns, the likes of

which are “Incredible India”, “Atithi Devo Bhava”, and multiple other such
campaigns
The Online Travel & Tourism Market In India
If we talk about the domestic travel and tourism industry, the segment has shown tremendous
growth over the course of the past few years. This segment has grown at a rate of 17.8% during
the fiscal years 2013 to 2016 in India, thereby outperforming the world travel and tourism
market by 6% which is an astounding task to say the least. Online travel bookings in the form of
gross bookings constitute around 41% of the overall Indian travel market (2014). The rapidly
increasing penetration of m-commerce, the rising propensity of convenience seeking behavior,
increasing penetration of smartphone and the internet, and a burgeoning middle-class urban
Indian population are a few factors responsible for boosting Indian travel and tourism in the
online mobile commerce space. This online travel and tourism market in India, as of 2014,
stood at a total of $9.1 bn constituted by air (at $5.1 bn), followed by rail (at $3.1 bn), then
hotels (t $0.8 bn), and finally others including road (at $0.1 bn). The penetration of
smartphones and the internet in the Indian travel and tourism industry has been estimated to
increase from 41% to 46% between 2014 and 2017. (Phocuswright, 2014)
Fig 6.4: Size of online Indian Travel and Tourism Industry in USD billion (Octane research, 2015)
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Increase in internet penetration: a catalyst for growth of online travel industry
Home to a population of 1.3 billion people, India ranks as the third largest country worldwide,
in terms of Internet user-base. Even then, at 17%, the Internet penetration rate in India is much
lower than the world average of 34% for the other developing countries. From 205 million
internet users in India in 2014, this number is estimated to reach about 580 million in 2018, the
growth being led primarily by improved awareness and affordable access. These indicators
signify a high growth potential for the upcoming years in the given segment.
This rapid growth over the last few years has and will continue to present immense
opportunities for development of the travel and tourism sector in the m-commerce space in
India. (BCG, 2014)
The growing availability of affordable smartphones and disruptive 3G and 4G Internet data
plans especially with the advent of Reliance Jio , the number of Internet users on smartphones
in India is set to grow at a much higher rate in 2018. With almost 50% of travel gross bookings
taking place online by 2020, this increasing penetration rate of mobile Internet is going to play a
significant role in the growth story of Indian online travel and tourism sector. (Octane research,
2015)
Growing debit/credit card and net banking penetration: Adoption of online travel platforms
In India, the number of credit card users has been more or less stagnant since 2008 and has
shown a very limited growth in the recent period, but the users of debit card have grown
consistently. With the advent of net banking, banking apps and digital wallets, a new gate of
opportunities has opened for the online travel market in India. The use of credit and debit cards
has been increasing over the past decade and has shown a tremendous rise just like the other
cashless modes of payment ever since demonetization happened. The card penetration rates
still remains low though, with 20 mn credit cards in circulation and 400 mn debit cards
accounting for 34% of the total population. This shows that there’s still a huge growth potential
left to tap by leveraging this and tying up with banks. (BCG, 2015)
Improving supply pipelines to make room for bigger opportunities
The accommodation space in India comprising of hotel supplies continues to remain upbeat.
The rapid increase in hotel supply coupled with the emergence of start-ups like Oyo Rooms has
positively affected the average rates for booking a room and its occupancy figures for the
customers. India’s tourism ministry indicated a shortage of approximately 1,50,000 rooms in
the mid-market , economy, and budget segments. However, many new rooms through apps
and upcoming hotels are in pipeline as of now. Apart from this, many global and local brands
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such as Ginger Hotels, Accor, Carlson Rezi-dor, Berggruen Hotels, InterContinental Hotels
Group, The Gateway, Starwoods, and Lemon Tree are focusing on adding more inventories to
the economy, budget and mid-market segments in a bid to attract a larger pool of domestic
travelers. (STR Global, 2014)
Despite all these numbers, with only 10% of the Indian hotels accepting online bookings, the
online Indian hotel segment still remains rather underpenetrated. And yet, the overall user-
base of customers, looking online for reviews and information regarding hotels continues to
remain very high. Although the conversions still take place offline. As more and more
consumers keep becoming familiar with m-Commerce, the number of hotel bookings online in
India is bound to keep increasing. (Google survey, 2015)
Even though the data on online hotel industry is not as high as the air travel data, these figures
continue to soar. Occupancy rates in hotels have been showing a growth rate of up to 8% year
on year, after having touched 59% in 2015. While the ADRs or the Average Daily Rates continue
to decline on a yearly basis, the magnitude has lessened for these declines, shown by the
recording of several instances of positive growth in the recent months.
6.3 Value propositions of m-commerce: Travel aggregator apps

India has seen so many policy changes to have now become a mobile friendly country where
over 87% people use their mobile devices to stay online. M-commerce through mobile apps and
mobile websites has become a substantial source of revenue for every business. As per the
reports released by BCG in 2014, following is the data regarding the number of mobile
application downloads on android and iOS devices of several travel portals:
Cleartrip - 2.2 mn IRCTC- 2.5 mn (on Android) Ixigo - 1.1 mn
To substantiate how mobile commerce is the future be all and end all for the online travel and
tourism market in India, we should have a look at the conversion rates for a few industry
leaders on mobile:
 MakeMyTrip: 30% conversion rate from mobile

 Cleartrip: 30% conversion rate from mobile
 Expedia India: 40% conversion rate from mobile
 Yatra.com: 25% conversion rate from mobile (Economic Times, 2015)
So, here’s a list of the top 10 most popular travel aggregator apps in India along with the key
value propositions that they have on offer:
1. MakeMyTrip
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MakeMyTrip is undoubtedly the most popular and among the best travel aggregator
websites available online in India that enables meeting all the requirements of any
traveler anytime and anywhere in the world, ranging from booking tickets on a flight,
bus or a train to getting the best possible accommodation in any city of the customer’s
choice. It offers all of these services at great discounts and other lucrative clubbed offers
which is the reason why it’s so popular among the customers.
MakeMyTrip is among the very few online travel websites that gives great discounts on
not just domestic flights but international flights as well. Their main focus is to ensure
the satisfaction of all their customers with the services they offer, and that’s why they
seek to provide the best services at affordable rates. That’s a key reason behind
MakeMyTrip being one of the most searched Indian travel websites. They also maintain
a travel blog for sharing travel experiences of the customers and the top places to visit
every season, along with tips and trivia on making the trip a great one at affordable
rates.
2. IRCTC Connect
Indian railways’ IRCTC website offers a very time-consuming and frustrating experience
for booking train tickets making it a tedious process for the users. Launched a few
months ago as a solution to this problem, IRCTC Connect, is to make the lives of
consumers slightly less difficult, by allowing them to search for trains, book tickets and
cancel them anytime anywhere. This app is only available for Android smartphones right
now. It retains the passenger details of all its users so that they have to repeat
themselves as the details get auto-filled in the blocks, and any new user has the option
to register directly from the app. It has an extremely neat User Interface relative to the
cluttered website interface, however just like the website, it’s dominated by
unnecessary banners and ads. As of now, more than half million people have
downloaded it on their mobile phones from Google Play giving it a 4 star rating.
3. RedBus
When it comes to booking bus tickets or hotel accommodation on the go, RedBus is the
go to app for this purpose. The Rebus app has a very user friendly interface that makes
it extremely simple for even an amateur user to choose the right bus suited for his or
her requirements (i.e. AC, Seater, Non-AC, Semi-sleeper, Sleeper, or any other
combination of these). It also provides customer ratings to make the choice easier for a
user, and lets them choose the boarding and dropping points as per his or her
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convenience, allowing the users to save their card details on the app for making any
future transaction easier. It also offers great discounts and cashbacks to lure the users
to stay loyal to the app.
4. Yatra.com
Yatra.com is among the most optimally priced online travel aggregator website that
offers super saving deals to meet all the travel requirements of the users at one place at
amazing discounted rates. It’s for booking tickets for both, domestic and international
flights, bus tickets as well as train tickets. It also guarantees the best prices for booking
accommodation in the hotels along with lucrative international as well as domestic tour
packages to honeymoon destinations, hill stations, family vacation spots, weekend
getaways and many more such exotic locations across the world.
5. Goibibo
Goibibo is yet another strong participant in the online Indian travel industry that allows
myriad different services to its users in the form of booking flight, bus and train tickets,
booking hotels in any city in the world and also choosing tour packages based on a
destination and requirements as per the user’s choice. It’s expanding continuously in
every possible segment of the travel and tourism industry and getting better and bigger
every day. For a customer who has plans to go to a foreign destination and is searching
for the most affordable deal, Goibibo is absolutely worth a try. In a market full of so
many players, it’s entirely up to the customer to decide which app to go for in order to
avail the best cost deal and cashbacks.
6. ClearTrip
Cleartrip is emerging to become a one-stop shop for the customers for all of their travel
related requirements. Its app allows the users to book rooms in hotels, and tickets in
flight, bus, and train, although every single one of these apps need an IRCTC login for
booking train tickets. The user interface of ClearTrip app is very friendly and simple to
use, offering a series of diverse features which cater well to the needs of both domestic
and international travel for the local and overseas users. It allows payments to be made
via a host of options including credit and debit cards, net banking, digital wallets and
virtual money. It also happens to be the only mobile app that allows a user to book his
tickets using international credit cards. It also shows its fares in terms of local currencies
for its GCC customers.
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7. TripAdvisor
For every trip, travel or tourism related search, the one result that always pops up in the
search results is TripAdvisor. Whether one is looking for the review of a hotel or a
resort, or a destinations guide, or a directory of any restaurant or even booking of flight
tickets, TripAdvisor is the one stop solution to serve almost every need of a traveler in
every travel and tourism category for all the countries on the globe. For the booking of
air tickets, TripAdvisor works exactly like Ixigo. It features the best deals on pages
owned by the related websites and redirects the users to the suggested destinations
websites to allot them the required seats.
8. Expedia
Expedia lets its users book their flight tickets, bus tickets and even cabs at the most
economical price at guaranteed rates. It is an online Indian travel website which tends
well to all the travel needs of every consumer. The key highlight of Expedia’s site
although is that when a user discovers that he or she could not bag the best available
guaranteed price on the web or if he or she paid a higher amount than what was
necessary, an instant refund shall be initiated to pay back the extra amount which was
charged to the user.
They offer exciting deals for the festive seasons along with amazing discounted prices at
flat rates for bookings of flight tickets and rooms in hotels, offer obviously being limited
to certain terms and conditions.
9. Ixigo
Ixigo always features in the list of the top 10 most popular online travel websites and
apps of India. Instead of offering the facility of booking on the parent website, Ixigo just
like TripAdvisor redirects its users to the relevant third party websites for ticket booking
such as Musafir, Easemytrip, and Cleartrip. The best part of this feature is that the users
get to compare the deals on offer by various aggregators to choose the best one before
being redirected to the third party websites or apps. Just like most other Indian travel
websites, Ixigo lets its users book train, bus, hotel, cab, holiday packages etc. It’s alos
responsible for developing some of the most popular mobile travel apps in India, for
example, the Indian Rail Train PNR Status check app.
10. Skyskanner
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The Skyscanner is another big name which always features in the top search page
results when a user searches for the best Indian online travel apps and websites.
Founded in 2003, the Skyscanner has been serving as a highly trusted platform for
searching and booking the best deals for flight tickets from India to any other
destination in the world. And it’s not just limited to traveling from domestic destinations
but also from any particular destination in the world to any other destination, thereby
acting as a unique platform for booking all possible services i.e., Hotel, Car, Flight, Bus,
etc.
The most unique feature of Skyscanner, however, is the option of ‘Anywhere Search.’
Instead of searching for a destination name in the ‘traveling to box’, one just needs to
choose ‘Anywhere’ destination type, then press the search flights button, sit back, and
then watch the search engine of the Skyscanner show its user the cheapest fares to all
the destinations from one’s source destination. The users has the option, of selecting
the cities from the listed options for the target country, and grab the lowest fare deal
once the website displays the flight details for all chosen locations.
6.4 Online Travel and Tourism Apps: A comparative study
App Mobile Website Android Ratings iOS App Ratings

App App
MakeMyTrip Yes Yes Link 4.2 Link 3.2
IRCTC Yes Yes Link 4.1 NA NA

Connect
RedBus Yes Yes Link 4.3 Link 3.4
Yatra Yes Yes Link 4.2 Link 3.5
Goibibo Yes Yes Link 4.2 Link 4.5
ClearTrip Yes Yes Link 4.3 Link 4.9
TripAdvisor Yes Yes Link 4.4 Link 4.3
Expedia Yes Yes Link 3.9 Link 4.5
SkyScanner Yes Yes Link 4.5 Link 4.6
Table 6.1: Comparison of Mobile apps in online travel sector (Source: Gadgets360, 2016)
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o MakeMyTrip: Services
o IRCTC Connect: Reliability
o RedBus: Deals and offers
o Yatra: Customer support service
o Goibibo: Cashbacks, discounts and virtual money
o ClearTrip: Payment gateway
o TripAdvisor: Feedbacks
o SkyScanner: Accessibility via ‘anywhere search’
6.5 M-commerce in online travel and tourism: Challenges

 Previously faced synchronization issues
Synchronization between the place of accommodation and the travel agency has always faced
issues in the past. Instances were reported wherein travelers booked rooms that had already
been booked earlier or were already occupied. Once booked, it was obviously next to
impossible to vacate the rooms or the seats in a plane and therefore, both the hotel and the
travel agency had to face a lot of issues concerning this.
In the present-day scenario, the advancements in technology have led to regular updates in the
inventory and regular updates on the booking status. Hotels/ Airlines can now provide XML
feeds to the agents/ guests. So, up-to-date information is readily available at anyone’s beck and
call and this has been only possible because of advancement in technology and better software.
 Different cancellation policies
The cancellation policies of different companies vary widely across spectrum. Right from
demanding a cancellation fee to charging for a minimum of one night in case of cancellation the
policies differ from one another depending on the hotel policies. On top of these, an extra
charge is demanded from the travel agency in lieu of their time and efforts. There are also
travel agencies and hotels that do not demand any extra charge in case of cancellation or have
a free cancellation policy.
Over time, due to increasing competition, the cancellation policies have become all the less
stringent and there are a lot of hotels that tend to offer free cancellation now.
 Slow connectivity issues
One basic infrastructural problem that essentially crops up in Asia is slow internet connectivity.
Although, there are substantial 4G connections today, there still exists substantial scope for
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improvement and a large chunk of population stays untouched from the internet spectrum
even today. Slow connectivity forces people to drop the idea of using online portals for booking
tickets or accommodation and instead start depending on direct person to person booking as
such. The majority of the population, especially in India, still finds it all the more convenient to
book tickets or accommodation face to face as it minimizes the fear of the unknown.
It is therefore, highly recommended that travel and hotel sites should be extremely light so that
they can be accessed even with slow net speeds and encourages people to make their booking
online.
 A travesty called Search Engine
OTA’s website made a lot of travelers wonder since most of them had a terrible search
experience. The primary problem was always locating the exact match of the kind of hotel that
the users were looking for. Credits to technological advancements, travel business owners
revamped the experience and made it extremely frugal and lucid to understand. The experience
improved drastically and the rate of online booking went up by leaps and bounds.
Now, most travel websites have introduced a concept of comparison of prices and facilities
offered by various hotels. Also, the concept of comsumer generated ratings comes in handy
while selecting the hotels.
 Filtered information delivered through travel websites
Albeit, it is true that most of the information about hotels is available online today but still
people feel that it is always better to judge the kind of services they should be expecting on the
basis of the voice of the person who answers the call, how they converse, what all facilities they
substantiate etc. It is also felt that hotels offer negotiation in the amount by upto 40% when
they are directly approached through phone. Most travel agency websites do not offer the
discounted rates on their portals as these drastically reduce their commission amounts and
therefore customers tend to directly approach the hotel in person or through telephone.
With changing circumstances of the work place, the travel agents are looking for more
innovative ways to attract new customers and increase their customer experience drastically.
 High attrition rate and job turnover
Since, this industry offers primarily entry level positions and most of these jobs are lowly paying
therefore a lot of the employees keep flipping the jobs and the attrition rates sore really high.
With this being a startup, it definitely phases a problem to find work loyal people under such
circumstances.
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Also, it takes a little time to get acclimatized to how things work in this industry and therefore
skilled labor is hard to train. Post turnover, new employees need to be trained from scratch and
these are perhaps the biggest challenges faced by travel agency managers.
 Limited Payment collection avenues
The collection of the due payments is considerably slower and requires time to time manual
intervention for most of the travel companies. The time that is spent in creation of the invoice
and the vouchers not only requires extra manpower but also ups the cost of operations. Most
of the travelers are distributed far north and south geographically and therefore direct
payment is not even considered an option.
In case of international clients, transfer of payments takes a lot of time after lots of clearances
and currency conversion.
 Competition from online travel companies
With the ever-increasing travel portals and online websites, the available rates, vacant rooms,
discount coupons etc. all fall short in luring customers to avail their services due to increased
competition. And therefore, the online travel companies depend on travel agents to fetch
clients for them. These online companies assist guests in picking the right hotel at the right
location in the right price. The on the spot payment options assist guest in finalizing their
booking with 100 percent surety.
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7. RECOMMENDATIONS & CONCLUSION
Based on the findings of all the primary and secondary research that has been conducted for
fulfilling the objectives of this report, certain key emerging value propositions have been
identified for all the three selected sectors: namely banking and digital payments, grocery
retail, and travel and tourism sectors in India. We first need to identify those before suggesting
the policy changes for businesses and service providers on the basis of the challenges
identified. They are as follows:
7.1. BANKING AND DIGITAL PAYMENTS:
The key challenges that we identified under this sector, mainly, comprised of security issues
pertaining to data phishing, session cancellation leading to logging out of payment gateways,
too much clutter, and trust issues on wallet apps. And the key identified emerging value
propositions include:
 Inclusion of the option for payments via offline digital wallets: which may work even
the data connectivity is not past such as by scanning the QR code, or through USSD
transfer which works for GSM based services.
 Option to pay later: Another proposition being witnessed in a few upcoming apps which
let the users make the purchase and pay the bills at a later date to the wallet service
provider just like a postpaid plan thereby giving more flexibility to the users.
 Merger of online retail with digital wallet providers: Based on the results of our survey,
a majority of the respondents want this option to be implemented where they don’t
have to visit two separate apps or websites for making a purchase and then paying for it
but want a one stop solution for it all just the way PayTm has initiated it.
 Ability to transfer money to peers: This is one option that the users want to be
incorporated in every digital wallet app where they can transfer money instantly to their
peers with a simple two step authentication without even needing internet connectivity,
another popular feature of USSD but with increased transfer limit.
 Improved security measures: This is one unanimous fear among all the users of online
banking and digital wallet apps because all of their details regarding their bank accounts
are stored here and there have been multiple cases of data phishing by hackers where
customers have lost significant amounts of money. So without adding anymore external
authentications, service providers and banks need to make the usage more secure by
strengthening internal encryptions to avoid any backdoor entries into their databases.
7.2. GROCERY RETAIL:
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For the online grocery retail sector, the key challenges that were identified based on the
research findings mainly include the hesitation in customers to pay the delivery charges,
infrastructural constraints, low profit margins, inventory management, low penetration, and
quality management to ensure freshness of products. The identified key emerging value
propositions of the sector include the following:
 Improved variety of products in terms of categories and brands: The customers seek a
one stop solution for all their daily household needs in these online grocery shopping
and delivery apps and that’s what they look for in an app. So, it’s the app’s prerogative
to expand their portfolios to engage the expanding needs
 Online assistance provider in the form of chatbots: A brand new proposition to engage
the customers and solve their problems in selecting a particular product in order to
drive better engagement and garner more loyalty from the customers through a one on
one interaction with them to guarantee satisfaction.
 Tie-ups with local stores for increased penetration in sub-urban areas and non-metro
cities: This will further their expansion to more locations.
 Flexible pick-up options and priority service: Customers want an option for ordering
online and self-pick-up at the store to ensure freshness of good on their part and have
an enhanced shopping experience. The regular customers should also be treated on a
priority basis by offering them loyalty points and better deals and discounts to ensure
their retention in this multi-player market.
7.3. TRAVEL AND TOURISM:
For the third and final sector of choice in this report which is the travel and tourism industry,
it’s important to first understand the challenges being faced by the businesses operating in the
said sector. The major challenges include the lack of differentiation between the multiple
players in the segment leading to confusion in the minds of customers, need for high speed
data connectivity to book the tickets, different cancelation charges for different apps and
subsequent tedious policies, and payment gateway technical glitches leading to further issues.
Based on our findings, the key emerging value propositions identified for the said sector are as
follows:
 Need for differentiation: This is a key finding of this report because most of these travel
aggregator apps have more or less similar offerings so the need to identify their unique
value propositions and focus on them to build a wider customer base is of utmost
importance in this highly cluttered competitive market.
 Aggregating all services: Instead of focusing on just one or two aspects of the travel
business, it’s imperative for the apps to become a one stop solution for all the needs of
a customer including blogs, reviews, and trivia for a safe and enjoyable trip.
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 Increased safety measures for all customers: The apps should share some liability to
handle a customer’s safety concerns and provide refunds in case something wayward
happens with regard to the bookings in the form of insurance policies, better
cancelation and refund terms and improved customer support service to handle all the
security and charge related grievances of the customers.
 Integration with social media accounts to provide on the go solutions: Instead of
unnecessary push notifications popping up on the smartphone screens, the customers
would rather have relevant tailor made information designed specifically for them
leveraging IoT and merging it with social media marketing to take care of every
individual customer.
7.4 SUGGESTIONS FOR POLICY MAKERS AND SERVICE PROVIDERS:
Since, m-commerce is here to dominate the Indian market and is going to be the major source
of revenue for most businesses, it’s going to have some implications on the service providers
and policy makers are as follows. Based on our research findings, I propose the following
suggestions for a better growth and development of m-commerce in all the chosen sectors:
 M-commerce service providers must improve the internal infrastructure of the devices
to improve service compatibility with the various requirements of a user, and merge it
with their past experience, their lifestyle and their beliefs via a suitable OS and User
Interface to stay consistent with their expectations as compatibility with any particular
app has been established as a key determinant for the adoption of mobile commerce
over desktop sites.
 The service providers of m-commerce should also consider the ease of use and
simplicity of usage while designing every part of their platforms and applications for
mobile devices as the aforementioned factors have a direct impact on the attitude of
usage and the intention of usage for mobile commerce. A focus on this may drive up the
revenue growth and profits for businesses.
 These service providers must consistently focus on securing services involving high risk
such transaction and bill payments, providing merchant information on the site, product
details, personal data shared online and its privacy etc. to ensure the safety and security
of customers and thereby overcoming a major hurdle for m-commerce across all
segments.
 Industry regulators and Policy makers such as the ministry of telecommunications, the
Telecom Regulatory Authority of India and the Reserve Bank of India must be the
deciding bodies on the risk involved in any app or business and must analyze and lay
down the strategy for the implementation of every new technology implemented by
corporates.
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 Industry regulators and Policy makers such as the ministry of telecommunications, the
Telecom Regulatory Authority of India and the Reserve Bank of India must take
practically thought out actions to ensure that the Indian m-commerce service providers
consistently improve their effectiveness and efficiency for the provision of services
related to mobile commerce so as to exceed customer expectations.
 Industry regulators and Policy makers must also conduct an independent survey on a
periodic basis to assess the satisfaction of customers regarding the quality of service
being delivered to them by the service providers in India.
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8. REFERENCES
I. Aranca report (2016). “India Online Travel Industry”
II. Agarwal, Sourav (2016). “Top Online Grocery Shopping and Delivery Apps in India”
III. Confederation of Indian Industry (2016). “E-Commerce in India: A Game Changer for the
Economy”
IV. Kant, Jai Prakash (2016). “E–Commerce as Key Factor for Tourism Development in India”
V. Kapoor, Nishtha (2016). “Industryscape: Mobile Wallets in India”
VI. Kaur, Rupindar; Singh, Sharda (2016). “Mobile Commerce: Indian Perspectives”
VII. Kazmin, Ami (2016). “India’s fledgling online grocery sector faces shake-up”
VIII. Potharaju, Sharath (2016). “How Indian mobile commerce will change in 2016”
IX. Prasad, Ravi Shankar (2016). “Mobile fueling E-commerce in India”
X. Tripathi, Vaishnavi J. (2016). “2016: Crucial phase for banking industry in the digital
marathon”
XI. Doda, Vaibhav (2015). “Travel E-Commerce: Past, Present and Future”
XII. Goodworks (2015). “How mobile app benefits travel and tourism industry”
XIII. Jashnani, Priya (2015). “Mobile and E-Commerce Grocery Retail and Food Service
Bloom”
XIV. Misra, Nabendu (2015). “Future of Digital Banking 2016 - 2017”
XV. Octane Research (2015). “E-travel marketing in India”
XVI. Prakash (2015). “Top 10 online travel websites to book your tickets cheaper”
XVII. Terence, Couture (2015). "How Designers and Brands are Marketing Themselves in the
Mobile Commerce Era".
XVIII. Agarwal, Sapna (2014). “India’s top 10 food retailers accumulate Rs13,000 crore losses:
Crisil”
XIX. Grewal (2012). “M-commerce and its Growth: An Analysis.” International Journal of
Technical Research (IJTR) Vol 1, Issue 2, 32-35.
XX. Gupta, Sachin & Vyas, Anand (2014). “Benefits and Drawbacks of M-Commerce in India:
A Review.” International Journal of Advanced Research in Computer and
Communication Engineering. Vol. 3, Issue 4, 6327-6329.
XXI. Mehra, Arjun; Soni, Alok (2014). “The big picture of online travel space in India that is
set to get bigger”
XXII. Harold, Dory (2012). "Theories of mobile commerce apps development".
XXIII. Hillman; et al. (2012). "Soft Trust and mCommerce Shopping Behaviours" (PDF).
Proceedings of the International Conference on Human-Computer Interaction with
Mobile Devices & Services (MobileHCI 2012).
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XXIV. Sharma, Sulabh; Gutiérrez, Jairo Alberto (Spring 2010). "An evaluation framework for
viable business models for m-commerce in the information technology sector".
Electronic Markets - The International Journal on Networked Business.
XXV. "From electronic to mobile commerce: opportunities through technology convergence
for business services" (PDF). Asia Pacific Tech Monitor. New Delhi (India. 23 (5): 38–45.
Retrieved August 23, 2010.
XXVI. Greene, Rory (2008). "Concessions one button away". Kentucky Kernel.
XXVII. Jordan, Jim (2008). "New arena service testing delivery to your seat". Herald Leader.
XXVIII. Troutman, Marci; Timpson, Steve (Fall 2008). "Effective Optimization of Web Sites for
Mobile Access: the transition from eCommerce to mCommerce". Journal of Interactive
Advertising. 9 (1): 65–70. ISSN 1525-2019. Retrieved August 23, 2010.
XXIX. Tiwari, Rajnish; Buse, Stephan; Herstatt, Cornelius (September–October 2006).
XXX. Anckar, B. a. D. I. D. (2002). "Value-Added Services in Mobile Commerce: An Analytical
Framework and Empirical Findings from a National Consumer Survey." Retrieved 17,
April, 2006.
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9. ANNEXURE
9.1 Questionnaires for customer survey
a. Banking & Digital Payments
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b. Grocery Retail
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c. Travel & Tourism
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9.2 Survey Demographics and Responses
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Do you own a mobile phone? How many devices do you own?
What do you use the devices for?
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Do you prefer desktop sites over mobile apps? Do you prefer online payments over cash?
Gender Age Group
Occupation
City of Residence
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DISSERTATION PROJECT: FINAL REPORT SUBMISSION

As a part of degree completion at

EMERGING VALUE PROPOSITIONS FOR M-COMMERCE:

Under the guidance of

2.1 Mobile Wireless Technologies: The journey so far

3.1 Exploratory research framework

4. Sectoral Study- Banking And Digital Payments

5. Sectoral Study- Grocery Retail

6. Sectoral Study- Travel and Tourism

7. Recommendations and Conclusion

7.1 Banking and Digital payments

9.1 Questionnaires for customer survey

Fig 2.1: The different generations of mobile internet (Hindu, 2015)

Fig 2.3: Areas for improvement (Source: Livemint, 2015)

Fig 4.4: The multiple applications of mobile banking

Fig 4.5: Mobile wallets in India (Source: Livemint, 2016)

Fig 6.1: Indian Travel Industry breakup (Phocuswright, 2014)

Table 3.1: Factors for data analysis

I. Provide an overview on the fundamentals of m-commerce covering its relationship with

Fig 1.1: Global scenario (Source: BI Intelligence report, 2015)

Smartphones in India 150,000,000

One of the features of m-commerce sites is the adaptation of websites on smartphones to

2.1 Mobile Wireless Technologies: The journey so far

Fig 2.1: The different generations of mobile internet (Hindu, 2015)

2.3 Emerging applications of m- commerce in various sectors

2.4 Impact of M-commerce on people and organizations

2.6 Opportunities and roadblocks

3.1 Exploratory research framework

Sample size n= 120 respondents in total

3.2 Questionnaire design

 Gender: Male/ female/ other

 No. of m-commerce devices owned: 1/2/>2

BANKING & DIGITAL GROCERY RETAIL TRAVEL & TOURISM

Payment gateway Payment Gateway Payment Gateway

Convenience Deals and offers Deals and offers

Security Discounts Cashbacks, discounts, virtual

Cashbacks Variety Services

Bill Payments Convenience Feedback

Offers & Deals Quality Reliability

Versatility Pricing Customer Support Service

Overall experience Delivery Accessibility

Table 3.1: Factors for data analysis

3.3 Data Analysis

3.3.1 Multiple Regression

Multiple regression is an extension of simple linear regression. It is used when we want to

Variables used for Regression

Dependent variable: AppPreference

Independent variables: DesktopVsMobileApp, ConveniencePaytm, SecureBankApps,

The hypotheses for this analysis will be:

Model Sum of Squares df Mean Square F Sig.

Residual 444.586 335 1.327

Total 680.808 380

The ANOVA shows that the model is significant.

Model B Std. Error Beta t Sig.

1 (Constant) -.319 .356 -.896 .371

NoOfDevices -.033 .065 -.030 -.506 .613

DeviceUse .043 .062 .039 .684 .495

OnlinepaymentPref -.184 .064 -.153 -2.865 .004

ConvenienceHDFC -.013 .061 -.012 -.215 .830

ConveniencePaytm -.035 .064 -.029 -.553 .581

ConvenienceBankApps -.012 .063 -.010 -.191 .848

ConvenienceAirtelMoney .028 .061 .026 .465 .643

ConvenienceMobikwik .056 .060 .049 .935 .350