Published by MBA Skool Team, Published on January 05, 2012
E-commerce is not new to India but what is new is the fact that it is most certainly one of the most exciting spaces for today’s global online community. With the advent of the new age millennials and the changing customer buying patterns it looks like the industry is now set for an exponential growth. In the first three months of 2011, Indian VCs have invested over $50 million in seven e-commerce companies. From where it stands now it has a long way but the immense potential which it has makes it very attractive. India’s 7 to 9 percent Internet penetration lags far behind the 30 to 40 percent China and Brazil enjoy, and while India’s estimated 100 million Internet users still comprise the third largest online population, the total Indian e-commerce market was approximately 3 percent of the U.S. market last year ($6.7 billion versus $227.6 billion).One key factor which is fuelling this growth is the rising middle class with disposable income who are comfortable with the idea of buying their stuff online. In the last five years, more than 1100 start-ups have come up. With more start-ups coming in, over the next 10-15 years, it is tipped that e-commerce would have 25% share in the present retail market.
Well, India traditionally is not exactly the greatest place to be doing business in .In fact India ranks 166th in ease of starting a business and 132nd in ease of running a business. The post liberation India still focuses on giving subsidies and freebies to the common man rather than the assisting him to start a business. So any help with running your business would be well received by Indian businesses. Web hosting and email services are one of the first things that Indian small businesses will require if they have to compete in the online market space which is typically dominated by large players. However, there are barriers that stop small businesses from getting online. These include but are not limited to high costs of hosting the website, technical expertise in designing , launching and maintaining the website.
Google India has identified this need and has launched ‘India Get Your Business Online’, a first-of-its kind program that offers free websites, domain and hosting services to small medium businesses (SMBs) in India. SMBs can logon to www.indiagetonline.in and use the tool to get a get a free, easy-to-build website and web hosting for one year. Google has partnered website hosting company HostGator, ICICI Bank and the Federation of Micro, Small and Medium Enterprises (FISME) for the initiative. Here is what Google is offering for SMB’s for the entire year:
A free .in domain (valid for one year)
A free hosting account for the website (valid for one year)
Free personalized e-mail accounts (Google Apps)
Access to expert tips and tools from Getting Indian Business Online team
A free Google Adwords advertisement coupon worth 2500 INR for promotion of the website
As per an Aegis report, Google has 89% market share in search engine category and has long seen India as a strategic partner in its business. It believes that the Internet retail market which is now valued at $100 million, will be $1 billion by 2015.All in all Google has taken care of everything that a SMB might worry about before opening a website. Indian SMBs have nothing to lose here. They get to have their business website running for a year completely for free. If they see any benefits, they can then choose to continue investing (domain renewal and hosting) and establish their business’ online identity.
Now let us try and analyze what is in it for Google. It is clear that Google does not want to let a potentially huge market in India slip through its fingers especially after what happened in China. To give you a quick recap, Google was once China's largest search engine, but owing to a bitter public controversy over online freedom and censorship with the government, it was forced to pull out of the country for several months. It was during this period that Baidu surpassed Google's leadership in search queries and, currently continues to be the largest search engine in China. Google has since made amends with the Chinese government, but clearly they have not been able to recover from this loss. China is the largest country in the world and with an ever expanding economy, there is no doubt that Google still feels the pinch from losing its position. Russia is another example of a large developing country that opts to use a native search engine as opposed to Google. Yandex is a Russian IT company which operates the largest search engine in Russia with a 64% market share. Google will be able to create a registered database of huge potential advertisers, along with their address, who they can pitch advertising products to in the future. The online advertising market is India is significantly agency dependent, and Google’s business has largely been agency driven, for which Google does offer some of them credit. Globally, the agency dependency is much lower, and smaller advertisers offer a good buffer. Google wants more advertisers on board and wants them to spend more Google’s keyword auction based benefits from competition. The more the competition for a particular set of keywords, the higher the ad rates. Once these businesses come online, Google may eventually offer a limited free online advertising, to help them drive traffic to their sites. They’ve been doing this intermittently for a while. Their hope is that some of these advertisers will renew their contract and remain online.
One thing is assured; this initiative can be a game changer and might bring a new dimension to how traditional businesses operate. Let us hope that this plays the role of a catalyst to bring the benefits of the internet economy to small and medium businesses in India and yes Google will definitely be watching.
“We started this company 12 years back. We started on a low note. We kept on adding more machines, from printing to packaging to die cutting. I have a whole team but still i am doing marketing all alone .So as the pressure of business is increasing every day, I need more people or anything to upgrade my marketing. I got so many ideas from different people regarding a website. But there were so many questions in my mind. Who will run it? How will I pay? Who will update it? My search ended when I came across India Get Business Online by Google .It was easy, it was free, a lot of staff support and off course I was Online in No time. Delhi was my market, Now after having a website, I personally feel I will be an international player, The World Is My Market Now”
Owner, Khosla Printers
“I started this business 4 years back. we are make footwear, accessories and garments, we have our own factory. When I started I thought, let's do a website. But then I found that it is expensive. It was also time consuming, Google is giving you a free website. You just have to give them the input, and i can make changes in that as I want to,which is very interesting. It was unbelievable that my website was made in 15 minutes. And I get a lot of support from them. Now its going to help me increase my business in a major way. I can portray the samples and products I'm making on the website. Buyers need not come to me. They can see my factory on the website.They can easily place orders online, for me to generate the business. Thanks to Google we're able to launch our website.”
This article has been authored by Prashanth Ramesh and Ashutosh Chaudhary from NITIE, Mumbai.
Views expressed in the article are personal. The articles are for educational & academic purpose only, and have been uploaded by the MBA Skool Team.
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