MAHARANA

PARTAP
ENGINEERING
COLLEGE
RESEARCH
ON
 ONLINE
RETAILING
SUBMITTED BY: JITENNDER

MBA FINAL YEAR(1704670018)

Abstract
The massive Indian Retail Market is changing fast. Customers are moving fast from Brick and
Mortar Retailing Stores to E-Stores or E-Retailing or E-Tailing. The E-Retailing or online
retailing sector in India is undergoing far-reaching changes with the advent of modern
information technology specifically increased internet penetration, increased confidence in
online payments and improved security measures. – These are some of the factors that are
attracting more and more consumers to shop online.

First of all, this study focuses on the basic composition of online retailing and the different
online retailing models. The centre theme of the article is the value proposition offered by the
online retailing. The value proposition provided is also the factors which are attracting the
customers to the virtual world of browsing and buying online. Along with the technology – these
factors are convenience of shopping from anywhere-anytime along with course dozens of
retailers to choose from and plethora of choices available in each category with the facility of
comparison of products, low prices and discounts, different payment options with cash on
delivery options. The next issue discussed is the trends in the online retailing in India which is
moving from consumer durables and apparels to groceries and e-retailing to m-retailing. The
methodology followed is the qualitative analysis of the secondary data and literature available
through different research articles, reports and documents. Different researches have been
collected and content analysis is done to bring about the findings and drawing conclusions.

Introduction
The reason for undertaking this study is very much obvious. Today online retailing or e-tailing is
very pervasive and growing thick and fast. So much so, today it has started to threaten the
traditional brick-and -mortar retail that many physical retailers have started to establish or beef
up their online presence. If not all pervasive it is going to give quite a competition to traditional
retailing. It is going to be a giant phenomenon in coming years. Thus in current scenario it
becomes imperative to study the existing state of affairs in online retailing industry so that
sufficient information is present for industry and researchers related to the value proposition,
factors attracting customers to buy online and the upcoming trends in the markets.

The study is organised into the following sections i.e. the introduction, objectives, methodology,
discussions and findings, conclusion.
According to Kotler et al. (2009)[10] retailing includes all activities in selling goods or services
directly to final consumers for personal, non-business use. Retailing can be broadly divided into
two categories store and non-store retailing. Store retailing refers to all forms of retailing through
physical establishments. It includes standalone retail stores or small convenience stores in
residential areas, the specialty stores with narrow product lines, the departmental stores with
wide product lines, supermarkets involving very large product lines with low cost, low margin
high volume, self-serving stores like Walmart operational worldwide, Big Bazaar and Spencers
in India. The other forms of stores may be discount stores, off-price stores and super stores etc.
Non-store retailing could fall under three categories

Literature Review
This study combines factors that other studies have done that will influence the consumer’s
purchasing decision in online and offline stores for apparels. It includes the price attractiveness,
time saving, perceived risk, enjoyment and excitement, tangibility and high interactivity. All of
these factors will contribute to the study of customer’s purchasing intention for apparels on both
stores which includes online and offline shopping. Pan, (2007) defined purchasing intention as
the eagerness of purchasing the product. Similarly, Engel, Blackwell and Miniard, (1990) defines
purchasing intention as a psychological process of decision-making. In online shopping, it is
expected that shoppers are more likely to associate price attractiveness and time saving with their
intention to shop while in offline shopping, consumers are more likely to associate tangibility,
high interactivity and enjoyment with their intention to shop. As a result, online marketers or
retailers should be aware of the problems faced by the consumers and their perceived risk to
increase their intention to shop in online. Designers must take note of consumers’ needs because
the usability is the starting point to get the confidence and support of the consumers (Alzola et.
al., 2006).

 Purchase intention
 Time saving
 Preceived risk
  Enjoyment and Excitement
 Tangibility
 High interactivity

Research problem
In the era of the Internet revolution, E-commerce industry is the brightest star! According to Statista.com
in 2015, retail e-commerce sales amounted to 342.96 billion US dollars and are projected to surpass 600
billion US dollars in 2019. Retail e-commerce in the U.S. is projected to generate a hundred billion U.S.
dollars in revenue by 2019. The figures clearly explain the power of ecommerce industry .
This doesn’t mean all the E-commerce companies are consistently making money. The small, as well as
big companies, have to face various challenges. Developing the business in ecommerce is the hard
part. You have to take care of everything, from website maintenance to customer service.

Below are the major problems that are faced by most of the ecommerce companies :

1. An absence of Online Identity Verification

2. Competitor Analysis

3. Maintaining customer’s loyalty

4.   The headache of product return and refund

Research Methodology
This study is based on secondary data. Different reports have been collected from a variety of
sources like various publications of the government; various publications of national and
international research organizations like CRISIL; books and newspapers; reports and
publications of various associations connected telecommunication (mobile and internet)
department like TRAI. Qualitative Analysis of various available literatures For the purpose of
this paper, online retailing includes selling of products through both online standalone and the
marketplace business models. This study also excluded online ticketing and online deals,
which do not compete directly with the traditional brick-and-mortar retail.
In the last five years, online retail -- both direct and through marketplaces – has had a helluva ride,
going from nascence (documents and reports) has been done using the techniques of statistical
compilations and manipulations, reference and content analysis discussed objective two whereas section
4.3 covers objective three Even at the end of the last century, online shopping was already starting to
catch people’s attention, and was slowly attracting consumers to use it as a channel, primarily because of
it’s ease in completing purchases (i.e. not needing to step out of the home) and also in providing
information as, even then, some sites already provided extensive information (Gay 1999, Gehrt et al
2007). But we are well into the first decade of the 21st century, and since then times have changed and
certainly, consumers’ motivations, as evidenced in this literature review and the results of the research
project, have changed.

The use of the online channel for shopping varies greatly by country with the UK and the US ranking
high up in the list with greatest ratio of online shoppers among Internet users, in addition to also having a
large penetration of users for Internet access (Bhatti 2006). In the UK, Internet access among households
has increased from 34% in 2000 to 54% in 2004, while Internet access for adults increased from 40% in
2000 to 64% in 2005 (Datamonitor 2006).

Research Process

Step 1: Identify the Problem

The first step in the process is to identify a problem or develop a research question. The research problem
may be something the agency identifies as a problem, some knowledge or information that is needed by
the agency, or the desire to identify a recreation trend nationally. In the example in table 2.4, the problem
that the agency has identified is childhood obesity, which is a local problem and concern within the
community. This serves as the focus of the study.

Step 2: Review the Literature

Now that the problem has been identified, the researcher must learn more about the topic under
investigation. To do this, the researcher must review the literature related to the research problem. This
step provides foundational knowledge about the problem area. The review of literature also educates the
researcher about what studies have been conducted in the past, how these studies were conducted, and the
conclusions in the problem area. In the obesity study, the review of literature enables the programmer to
discover horrifying statistics related to the long-term effects of childhood obesity in terms of health
issues, death rates, and projected medical costs. In addition, the programmer finds several articles and
information from the Centers for Disease Control and Prevention that describe the benefits of walking
10,000 steps a day.

Step 3: Clarify the Problem

Many times the initial problem identified in the first step of the process is too large or broad in
scope. In step 3 of the process, the researcher clarifies the problem and narrows the scope of the
study. This can only be done after the literature has been reviewed. The knowledge gained
through the review of literature guides the researcher in clarifying and narrowing the research
project. In the example, the programmer has identified childhood obesity as the problem and the
purpose of the study. This topic is very broad and could be studied based on genetics, family
environment, diet, exercise, self-confidence, leisure activities, or health issues. All of these areas
cannot be investigated in a single study.

Step 4: Clearly Define Terms and Concepts

Terms and concepts are words or phrases used in the purpose statement of the study or the
description of the study. These items need to be specifically defined as they apply to the study.
Terms or concepts often have different definitions depending on who is reading the study. To
minimize confusion about what the terms and phrases mean, the researcher must specifically
define them for the study. In the obesity study, the concept of “individual's health” can be
defined in hundreds of ways, such as physical, mental, emotional, or spiritual health. For this
study, the individual's health is defined as physical health.

Step 5: Define the Population

Research projects can focus on a specific group of people, facilities, park development,
employee evaluations, programs, financial status, marketing efforts, or the integration of
technology into the operations. For example, if a researcher wants to examine a specific group of
people in the community, the study could examine a specific age group, males or females, people
living in a specific geographic area, or a specific ethnic group. Literally thousands of options are
available to the researcher to specifically identify the group to study. The research problem and
the purpose of the study assist the researcher in identifying the group to involve in the study. In
research terms, the group to involve in the study is always called the population.

Step 6: Develop the Instrumentation Plan

The plan for the study is referred to as the instrumentation plan. The instrumentation plan serves as the
road map for the entire study, specifying who will participate in the study; how, when, and where data
will be collected; and the content of the program. This plan is composed of numerous decisions and
considerations that are addressed in chapter 8 of this text. In the obesity study, the researcher has decided
to have the children participate in a walking program for six months. The group of participants is called
the sample, which is a smaller group selected from the population specified for the study. The study
cannot possibly include every 10- to 12-year-old child in the community, so a smaller group is used to
represent the population

. 

Step 7: Collect Data

Once the instrumentation plan is completed, the actual study begins with the collection of data.
The collection of data is a critical step in providing the information needed to answer the
research question. Every study includes the collection of some type of data—whether it is from
the literature or from subjects—to answer the research question. Data can be collected in the
form of words on a survey, with a questionnaire, through observations, or from the literature. In
the obesity study, the programmers will be collecting data on the defined variables: weight,
percentage of body fat, cholesterol levels, and the number of days the person walked a total of
10,000 steps during the class.

Step 8: Analyze the Data

All the time, effort, and resources dedicated to steps 1 through 7 of the research process culminate in this
final step. The researcher finally has data to analyze so that the research question can be answered. In the
instrumentation plan, the researcher specified how the data will be analyzed. The researcher now analyzes
the data according to the plan. The results of this analysis are then reviewed and summarized in a manner
directly related to the research questions. In the obesity study, the researcher compares the measurements
of weight, percentage of body fat, and cholesterol that were taken at the first meeting of the subjects to the
measurements of the same variables at the final program session. These two sets of data will be analyzed
to determine if there was a difference between the first measurement and the second measurement for
each individual in the program. Then, the data will be analyzed to determine if the differences are
statistically significant. If the differences are statistically significant, the study validates the theory that
was the focus of the study

Data Collection
Data collection for marketing research is a detailed process where a planned search for all relevant data
is made by a researcher. The success of marketing research is contingent on the integrity and relevance
of the data. And to a high degree, the quality of the data depends on the methods of data collection
used. The selection and use of methods for conducting marketing research require a great deal of
experience and expertise in order to correctly gage suitability.

These methods fall into two types of research categories, which are Qualitative Research and
Quantitative Research. Qualitative Research is generally used to develop an initial understanding of the
problem. It is non-statistical in nature and the answers are derived from the data itself. It is used in
exploratory and descriptive research designs. Qualitative data can be procured through a variety of
forms like interview transcripts; documents, diaries, and notes made while observing. Quantitative
Research, on the other hand, quantifies the data and generalizes the results from the sample to the
population.

There are two types of data:

Primary Data – Data that is collected first hand by the researcher. This data is specifically collected for
the purpose of the study and addresses the current problem. This is original data that is collected by the
researcher first hand.

Secondary Data – Data from other sources that has been already collected and is readily available. This
data is less expensive and more quickly attainable from various published sources. Secondary data is
extremely useful when primary data cannot be obtained at all.
The challenge lies in the case of method selection for collecting primary data. The method has to be
relevant and appropriate. This will be the most important decision prior to beginning market research.

Data Analysis

Online Retailing in India (more than Rs. 500 billion in 2018)

Standalone Online Retail Online Marketplace

(app. 17%) (app. 18%) Other E-Commerce activities
Retail products sold through Platform where sellers Online ticketing, air, rail, bus, movie, events,
online and buyers tourism
Route transact online packages, online deals, online portals
Shopper Stop Flipkart Make My Trip
Croma Amazon Book My Show
Jabong Snapdeal Times Deal
IKEA eBay Olx, Quikr

Online Retail for purpose of this article

 Statistical Tool
On-line Retail

E-commerce generates large datasets that potentially tell you how every customer prefers to shop, what
they prefer to buy, and (potentially) where they haven’t found what they wanted. Data can be
segmented and aggregated in imaginative ways that were never possible in the past. The intelligence
you gain from this analysis can inform website design, help you develop more appealing product offers
and target marketing campaigns at individual needs, motivations and emotional triggers .

How we use statistical analysis in e-commerce:

 Devising A/B split testing protocols. What factors you can test, sample sizes and accounting for
bias and confounding.

Conversion rate optimisation. Identifying factors that prevent sales reaching completion and
using statistics to drive targeted improvements to site design, navigation, and online checkout.

Returns planning to ensure returned goods are ready for resale as quickly as possible.

Optimising stock levels held at stores and warehouses.

Using qualitative data analysis and user testing to improve e-commerce conversion rates.

Findings
One of the basic questions in online retailing space is what it basically comprises of in the open
E-commerce or E-business space. CRISIL Research defines online retailing companies as a part
of e-commerce companies particularly those in the primary business of providing web
platform(s) and website(s) through which individuals, using a computer or smart phone, can
purchase a product or service. The definition excludes classifieds and information portals, online
transactions between businesses, and websites offering online financial services. The most
accepted orfollowed classification is that of CRISIL Research’s which includes standalone
online retailers and marketplaces, butexcludes segments such as online ticketing and online
deals, which do not compete directly with traditional brick-and-mortar retailers. But they all are
included in e-commerce. In a joint research paper by Deloitte and ASSOCHAM (2015)the online
B2C market is being divided as market Marketplace business model and Inventory based model.

The Standalone retailers or the Inventory based retailers own the inventory and sell through their
websites, in India Shopper Stop, Jabong, IKEA etc. are operating in this space. This model is
basically exploited generally by established brands or by erstwhile supermarket retailers
converting into online retailing platforms. In this model all the activities are managed by the
online seller who takes the order and delivers it and earn the profit. On the other hand the
Marketplace is a business model where numerous sellers place their products on online
marketplace or marketing web portals, the inventory in this model is owned by the sellers who
place their products on the online web portal, though in some cases some of the inventory may
be owned by the web portal like Flipkart. In this model the presentation and order placement is
done through the web portal whereas the products are dispatched by the sellers.

Conclusions
It is evident in the light of above discussion that abundant opportunities galore for e- tailing in
India. In 2014 online retail was only 7.9% of the organized retailing and a meager0.5% of the
total retailing in India. This speaks volumes of its potential. It is expected that the industry’s
revenues tomore than double to around 18 per cent of organised retail by 2016 from around 8
percent in 2013. Yet, its share of the overall retail pie will be just over 1%. That compares with
9-10% in the US and UK, and around 4-5% in China. The value proposition discussed shows the
need of the young generation in the present era. Convenience, choice, discounts and payments
options all goes in accordance to the generation next requirements. With all these the e-tailing is
bound to be the next phenomenon in India. The trends that would be followed in future would be
increased use of smart phones for shopping, increase of vertical in e-tailing, extension of product
categories from durables and apparels to groceries and big home appliances. Physical retailers
have to beef up and extend their operations to online channels. Increasing competition is one of
the most immediate challenges that e-tailers have to face and carve out a niche for themselves.

References
Cellular Operators Association of India, 2011. Mobile Money –Opportunity in India. Retrieved
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Crisil Research. Crisil Opinion, e-tails eats into retail, 2014. Retrieved from
http://www.crisil.com/pdf/research/CRISIL-Research-Article-Online-Retail-Feb14.pdf.

Dwivedi M, Mahesh V. On-Line Retailing in India: Opportunities and Challenges, International

Journal of Engineering and Management Science, 2012; 3(3):336-338. Retrieved from
http://www.ijarcsse.com/docs/papers/March2012/volum e_2_Issue_3/ V2I30029.pdf.

India to have 519 million mobile internet users by FY18: Morgan Stanley, Retrieved from The
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