Future of Car Retailing in the Indian Automotive Industry
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1 Future of Car Retailing in the Indian Automotive Industry More Automakers are Expected to Use Online and Digital Modes to Complement Traditional Sales 9AB2-18 September 2014
2 Contents Section Slide Number Executive Summary 4 Definition of eretailing 6 Overview of eretailing Model for Passenger Cars 11 Future Omnichannel and Digital Retailing Strategies in the Automotive Industry 17 Unique Customer Journey 32 Best Practices in eretailing Auto, Electronic Goods, Real Estate 36 Case Study Audi Online Retail 37 Case Study BMW Digital Retail 39 Case Study Mercedes-Benz Digital Retail 40 Case Study Maruti Suzuki Online Retail Programme: Dil Se 41 Case Study Skoda Online Retail 42 Case Study Flipkart Online Retail Strategy 43 Case Study Tata Value Homes Online Retail 44 Future Roadmap 45 The Frost & Sullivan Story 50 9AB2-18 3
3 Key Findings ecommerce is expected to grow fourfold in India by 2020, accounting for % of India s economy up from less than % in 2013 with major contributions from Amazon, Google, ebay Inc., Wal-Mart and Indian e-tailer Flipkart. Online travel booking accounted for over % of consumer ecommerce transactions in Online retail sales generated $ billion in Online new car retail in India is hindered because of the registration process at regional transport offices (RTOs), pre-delivery checks, and financing activities. The only potential online actions will be general, technical research; pre-bookings; bids; and short-term deals. Renault India is capitalizing on digital and social media: about % of its leads are via the Internet and mobile devices, and it has heavily invested in technology. Digital marketing spends for Ford India increased in 2013 % of its budget will be on digital and mobile promotions, with % each for on-air promotions and on-ground activities. It has online and digital campaigns for the EcoSport model. Google India launched the Great Online Shopping Festival in 2012; % of the shoppers for the 1-day promotion were first-time buyers. It was expanded to 4 days in 2013 houses and cars were sold, with % of the shoppers being women. This was a clear indication of the potential of ecommerce in India. Skoda India initiated its Online Sales Project in association with CarWale.com in 2009 with variants of the Skoda Fabia. It is now extended to book any car in the Skoda line with a nominal booking fee of INR (about $) and a % money-back guarantee in case of cancellation. Source: Google India; Renault India; Skoda India; media blogs; Frost & Sullivan 9AB2-18 5
4 Definition of eretailing eretailing is a subset of ecommerce in which goods and services are purchased online, either directly or through business-to-consumer (B2C) intermediary sites. Retail Industry eretailing ecommerce emarketing Catering Services Food and Staples Apparel and Fashion Group Purchases Restaurants and Cafes Home and Garden Books, Music, and Videos Health and Beauty Auctions Bars and Nightclubs Electronics Motor Vehicles etravel and ticketing efinancial Services Source: Frost & Sullivan 9AB2-18 7
5 eretailing Landscape in India Key Takeaway: Fuelled by Internet penetration and improved connectivity, eretail sales expected to grow $ billion by eretail Sales, India, 2013 and 2025 Online Retail Market (B2C)*, India, 2013 and 2025 eretail Sales Forecast of Top 5 Segments, India, 2025 Sales ($ Billion) Sales ($ Billion) Offline Sales, India, 2013 and *Excludes B2B; C2C; and online travel, classifieds, and banking Segment Consumer Electronics Computer Hardware Apparel Books Jewelry/Luxury Goods/Accessories Others** Total Sales ($ Billion) eretail Market (%) **Others include flowers, gifts, greetings cards, home and garden equipment Source: Vizisense; Accel Partners; Internet and Mobile Association of India; comscore; Frost & Sullivan 9AB2-18 8
6 Top Online Retailers Key Takeaway: More than million Indians accessed eretail sites from work or home in November 2011, an increase of % from November Rank Site Total Unique Visitors ( 000) Reach (%) 1 Amazon sites 2 Apple.com global sites 3 Samsung Group 4 Flipkart.com 5 Homeshop18.com 6 Naaptol.com 7 Bookmyshow.com 8 Myntra.com 9 Priceindia.in 10 Alibaba.com Corporation Total Internet Audience** Top 10 eretail Sites by Unique Visitors*, India, November 2011 Online retailers in India are rapidly expanding to non-metropolitan Tier II and Tier III markets, offering payment options such as cash on delivery (COD) for consumers with no bank accounts. *Visitors age 15 or older from home or work **Total visitors to all eretail sites in India Source: comscore Media Metrix; Frost & Sullivan 9AB2-18 9
7 Internet in India Key Takeaway: Social networking is expected to reach 554 million users in India by of Top Social Sites, India, 2010 and 2020 Internet *, India, 2010 and Facebook 2 Twitter Total: 1,219 million Total: 1,399 million (Million) 0 (Million) 0 Non-Internet users Internet users Non- Internet users Internet users Internet users split Internet users split (Million) 3 0 LinkedIn Non-Social Social Non-Social Social *Pie chart values are in millions Source: Socialbakers.com; comscore; LinkedIn; Facebook; twitter.in; orkut.com; teck.in; Frost & Sullivan 9AB
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