Marketing, Strategy, Web

Why Amazon Is Yet To Capture The Indian Market..and Mindset

Having reached the USA, one of the most visible things i saw in the first month here, was how much everyone relied on Amazon.
Professors buy books every week from Amazon.
Students buy books from Amazon.
Students buy used books from Amazon.

People shop on Amazon. For virtually all of their needs.

I was tempted to think of why its not the same in India. Why do we rarely hear students or professionals talk of buying from Amazon.
Ofcourse there is lack of widespread internet connectivity. A large fraction of the population still doesnt have access to a computer let alone the internet.

But even in urban areas, cities and universities where internet connectivity is at an all time high, ecommerce of the scale that Amazon promises…is yet to take off. Some reasons:

1) Large scale proliferation of used book vendors on the streets.
2) Lack of secure or trusted or reliable ecommerce payment channels.
3) Slow traction from partner banks in providing support to ecommerce payment products
4) Apathy to books: fundamentally, the Indian community has been built on a system of rote learning in the classroom. Students are happy to read their class-notes, and write exams. They get good grades. And they are happy. There is a lack of appetite for true and deep knowledge. And this shows in the lack of interest to actually search and buy books.
5) Lack of Indian retailers: Few bookshops in india have a full fledged web commerce presence. So most customers have to have the books/items shipped from global warehouses [ i am guessing that most r in usa]. This adds to high cost. So people would rather buy the books themselves.
6) Sharing: Indian mindsets are fundamentally built on the culture of sharing. Students share books/materials. And encourage reuse of books/materials by handing them over to their juniors once they use them. There is hardly any reaction to the editions getting old. Students just like to get the crux of the book.

Hmmm..something for Amazon to think about!
Over here in the usa, its A-Z and Amazon!!

Shantan

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14 thoughts on “Why Amazon Is Yet To Capture The Indian Market..and Mindset

  1. Nice article. I think this has also to do something with the difference in buying habits. People in India are habitual to bargain for everything apart from groceries. Paying a fixed price on a website or even a shop wouldn’t gain traction.

    Secondly, people have pet places already in mind wrt to certain goods and services. For instance, in IIT Delhi, buying books meant going to Jawahar book depot. Building such a strong ‘brand’ will take time but I am sure as online penetration increases in India, shopping on the web should become more commonplace.

  2. Kaushik says:

    Also, the fact that most Indians are still not very confident about many features of the internet, especially money transactions.

    Also, the fact that very few Indians read e-books.

    As Umang said, places like JBD (In KGP, we had the Tech Market), is a good place to hang around with friends, and buying books is just another excuse to do so

  3. Amit S Holey says:

    Another issue is the shopper mentality in India. The average Indian still wants to see, feel the product s/he is buying. The tangibility factor is still pretty dominant.
    That is why the teleshopping concept also has not picked up in India.

  4. jagdish says:

    @amit
    The average Indian still wants to see, feel the product she/he is buying

    i liked this point …as we generally blame on internet accessibility and money transaction but this is the main innner curiousness of indians which causes us to buy books personally after feeling it.
    and we indians generally accepts changes very slowly and once we accept we dont go for other changes …..

  5. Deepak says:

    Another problem for students:
    As the international editions are little costlier, they tend to go for having photocopies versions.
    Nonetheless, for the upcoming employed personnel, there is a growing trend of using online shopping for books.

  6. 2) Lack of secure or trusted or reliable ecommerce payment channels.
    3) Slow traction from partner banks in providing support to ecommerce payment products.

    This is the most Important aspect from my Perspective.

    This is also the reason even ebay or any ECommerce Product Service is not used as mush as in these European and American Market…

    Only the biggies like Shadi.com, Times, not to mention Indian Railways, etc are able to avail Payment methods which will work for almost all types of Visitors. Credit Card, Debit Card, Bank Accounts etc.. Reason… They have Direct Tie ups…

    Small Businesses can’t afford this…

    The Monopoly and NOT Sharing(Contrary to the last Point where shantan pointed out Indian mindsets as fundamentally built on the culture of sharing, I haven’t seen much of Open Source Projects Contribution by Indians, But yes the Point is indeed valid in other Aspects(People not Businessmen Share…)) the Infrastructure

    Have more to say but there is Power Cut here and the UPS is blinking…

    @rungss on Twitter

  7. sriram rajagopal says:

    Nice article.

    1) Large scale proliferation of used book vendors on the streets.

    I think this is THE big reason.. Everyone wants their money worth.. When there are places such as Nai Sarak(Delhi),College Street(Kolkata), Moore Market(Chennai),etc where one can buy a new book at a 20-25% discount or a used book at around half the price, people are more inclined to purchase books from such places rather than shelling out a premium through online purchases.. I wonder if this trend would ever change !

  8. atul says:

    Shantan, more than anything else, the reason behind this, as we figured at a PPT from Amazon in our IIMC Campus, is that the Indian Laws do not allow Amazon to setup their network in India yet, unless they part with a significant part of their profits. That’s the main reason.

    I am sure, the day Amazon steps into India, payment gateways will automatically take a step towards improvement!

  9. Shantan says:

    Hey Atul: that was a useful piece of information. But even if the indian laws permit..we havent seen other ecommerce companies in india take on the books space in a big way. We dont have any real desi web brands that sell books.

    Some part of me says this is a real big opportunity for a web-based online book store…..for india! We need an Indian Amazon!

  10. Vickram says:

    Hi,

    I disagree with 4. Apathy to books…..Though being an MBA student tht might be the only option u had but as for other disciplines ppl do use books 🙂

  11. Shantan says:

    @vikram: not really. i am not an MBA myself 🙂
    yeah..there are the ones who really read books and get knowledge. But for the most part…most of us, just want to graduate and get on with our careers. We rarely have time for reflecting on knowledge…..and reading books! Dont we give up our books the moment we end our exams?? well..to a great extent, yes!! 🙂
    But i see what you are saying…..you have a point! Its true..but certainly not the norm!

  12. Amit says:

    Hi Atul,
    Do you know what are these limitations?
    Are they taxed differently than any other business?

    Amit

  13. Sorry don’t recollect now, will try and get that information. But there are laws against it right now is what we were told..

  14. Vishal Jain says:

    Well, the biggest problem that most of the time that stops me from buying it from here is the delivery time and the delivery cost.If you want to buy a book here, it will take about a month to reach you and the average shipping cost will be around $10-$15 .On the other hand, if the same book is available on say landmark, then you don’t save on the time, but the shipping cost is as low as Rs 100/-.
    Another thing is that you can’t order a few things because they are not shipped to India. I wanted to buy a couple of softballs for my son, but no one was shipping them to India. And $10 of items with shipping cost of $15 anyway does not feel right in the pocket.

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