The Potential Market Of E Commerce

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We will begin by seeing the potential market of e commerce in India. Our main purpose is to evaluate that whether E commerce has as wide a range as physical market or an area wider or shorter than that. India, with 1,270,272,105 people is the second most populous country in the world, while China is on the top with over 1,360,044,605 (1.36 billion) people. As we know people below the poverty line won’t be able to afford luxury items that are often the products sold by online shopping sites, we narrow down our search for potential buyers to the ‘above poverty line’ population. According to the data of the planning commission 22 July, 2013, said that poverty in India had declined from 37.2 percent in 2004-05 to 21.9 (approximately 22%) by 2011-12. Now the total population of India consists of 1,270,272,105 individuals and as the people above poverty line are only 78% (100%-22% of below poverty line) , the total population above the poverty line (that is 78% of 1,270,272,105) is approximately 990812242 people. These people are the ones who can afford to use internet as it is a lavish service. On further investigating we see only 9 % of population uses internet and thus we narrow down the numbers to 89,173,101 users (9% of 990812242). So the scope of e commerce markets in India easily lies beneath the 89 million mark and can’t be after that. However it is easily far below the limit we have set. The Physical markets however have a wide scope and reach as compared to e commerce. The point of e commerce is that is simplifies transactions that earlier required use of physical energy and the need to cover long distances while with e commerce ,we can have our favourable products delivered at our doorstep with just a click of our mo... ... middle of paper ... ...e deals are guaranteed. It is clear that two of India 's biggest online retailers and even others like Amazon and eBay are out to catch as many customers as they can before Diwali, never mind the cost of acquiring these customers. The websites tried to outdo each other in selling merchandise at prices which may even be below cost prices ,but Snapdeal and Amazon do not hold inventory. They merely provide a platform for sellers to reach potential customers, making money on every transaction. Flipkart follows a mixed model where it stocks inventory for some items but does not do so for others. It is clear that through these rock-bottom prices, the e-retailers themselves are unlikely to suffer in their earnings - it is the actual seller who is possibly offering unbelievable deals and hoping that sheer sales volume will make up for lost earnings on such deep discounts.

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