Draft For Research Project
Draft For Research Project
Draft For Research Project
Introduction
E-commerce (electronic commerce) is the activity of electronically buying or selling of products on
online services or over the Internet. E-commerce draws on technologies such as mobile
commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction
processing, electronic data interchange (EDI), inventory management systems, and automated data
collection systems. E-commerce is in turn driven by the technological advances of the semiconductor
industry, and is the largest sector of the electronics industry.
E-commerce typically uses the web for at least a part of a transaction's life cycle although it may also
use other technologies such as e-mail. Typical e-commerce transactions include the purchase of
products (such as books from Amazon) or services (such as music downloads in the form of digital
distribution such as iTunes Store). There are three areas of e-commerce: online retailing, electronic
markets, and online auctions. E-commerce is supported by electronic business.
E-commerce businesses may also employ some or all of the following:
The term was coined and first employed by Dr. Robert Jacobson, Principal Consultant to the
California State Assembly's Utilities & Commerce Committee, in the title and text of California's
Electronic Commerce Act, carried by the late Committee Chairwoman Gwen Moore (D-L.A.) and
enacted in 1984.
Electronic commerce has totally changed the lifestyle and living standard of the consumers. Most
of the customers, especially youngsters are moving from brick-and-mortar shops to online business
sites. They see it as more comfortable and easy way to do the transaction as it reduces their use of
time which is more time consuming in case of traditional commerce. The need of e-commerce
emerged from the need to use computers more efficiently in banks & corporations. As the
competition is increasing on a rapid base, most of the organizations are looking forward to
increase customer satisfaction and information exchange which will build a set of trust in the
mind of consumers regarding the organization. E- commerce was basically started by banks by
introducing electronic funds transfer.
Despite being such large and strategic, the Indian consumer market has not experienced the
impact of online shopping although at the same time. Online shopping has made largest rides in
the global market. However, a very large potential exists in market. The continuous growth of
online marketing has stimulated great interest and enthusiasm in studying online consumer
behavior. Given as per the significant growth in online shopping, better understanding of
consumers allows better marketing strategies to be designed. Despite of the shopping mall culture
in the country, more and more Indians are now shifting towards online shopping. The potential
growth of on-line shopping has ignited the idea of conducting a study on online shopping in
India. On the other hand, the exponential increase in online shopping and the fast rate of growth
in the number of retailers selling online have created an extremely competitive marketplace.
Therefore, it necessitates for any online marketer to understand about the factors that affect the
online behavior of customers so that they can develop or improve their marketing strategies in
such a way that the potential consumers can be converted into active consumers and existing
customers can be retained.
There are 5 major types of E-commerce:
1) Business to Business E-commerce Industry.
2) Consumer to Business E-commerce Industry.
3) Business to Consumer E-commerce Industry.
4) Consumer to Consumer E-commerce Industry.
5) Intra-organizational E-commerce.
E-COMMERCE IN INDIA
The online business showcase in India is assessed to develop from $10 billion consistently to between
$70-260 billion consistently by 2025.It is additionally assessed that the web-based business
showcase is about 57% from unassuming communities and the equalization from the biggest
metros. The most famous utilization of online business is on movement sites, which is finished by
about 70% of all web- based business shoppers in India. There are difficulties to internet business
organizations working in India-including some hesitance of shoppers to pay for merchandise or
administrations on the web. A few organizations are attempting to get around this issue by giving
money down as a support of their shoppers. For example, issues related to payment and refunds
etc. The most frequent issue that is discussed by the researchers in the context of e-commerce is
customer satisfaction. Customer satisfaction is one of the best things that e-commerce should look
into because customer is the profit means to a business. In addition to this it also emphasized the
importance of satisfaction which influences the customers to repeat purchasing through same
platform frequently.
CUSTOMER SATISFACTION
Customer satisfaction is a very significant concept of marketing. It is a measurement that helps in
determining how satisfied or dissatisfied the customers are with the products, services, and
capabilities of a company. It acts as a very important tool in not only determining the customer
satisfaction towards the company but also in improving or changing the products and services in
such a way that the customers’ expectations can be reached.
Along with this, customer satisfaction plays a pivotal role in marketing as it creates customer
loyalty which can further be very effective to a company because loyalty leads to word-of-mouth
marketing
IMPACT OF ONLINE SHOPPING ON CUSTOMER SATISFACTION:
The trend of online shopping has shown an escalating increase in the era of digitalization. The
ease, convenience and other benefits of online shopping have shifted the people towards the e
commerce platform. The provision of proper information and comparison of the products through
e commerce platforms have boosted the customer satisfaction. The impact that online shopping has
on customer satisfaction includes access convenience, search convenience, evaluation
convenience, transaction convenience, possession convenience, and post possession convenience.
The major companies that are selected for this comparative study are Myntra and Ajio. The
reason for selecting these companies is that they are most preferred online retail stores and also
because of the availability of large number of brands on these e commerce retail chains.
Myntra
Myntra is a major Indian fashion e-commerce company headquartered in Bengaluru, Karnataka,
India. The company was founded in 2007 to sell personalized gift items .In May 2014,
Myntra.com was acquired by Flipkart.
History
Established by Mukesh Bansal along with Ashutosh Lawania and Vineet Saxena; Myntra sold on-
demand personalized gift items. It mainly operated on the B2B (business-to-business) model during
its initial years. Between 2007 and 2010, the site allowed customers to personalize products such as
T-shirts, mugs, mouse pads, and others.
In 2011, Myntra began selling fashion and lifestyle products and moved away from personalisation.
By 2012 Myntra offered products from 350 Indian and International brands. The website launched the
brands Fastrack Watches and Being Human.
In 2014, Myntra was acquired by Flipkart in a deal valued at ₹2,000 crore (US$270 million). The
purchase was influenced by two large common shareholders Tiger Global and Accel Partners. Myntra
functions and operates independently. Myntra continues to operate as a standalone brand under
Flipkart ownership, focusing primarily on "fashion-conscious" consumers.
In 2014, Myntra's portfolio included about 1,50,000 products of over 1000 brands, with a distribution
area of around 9000 pincodes in India.[15] In 2015, Ananth Narayanan became the Chief Executive
Officer of Myntra.
On 10 May 2015, Myntra announced that it would shut down its website, and serve customers
exclusively through its mobile app beginning 15 May. The service had already discontinued its
mobile website in favour of the app. Myntra justified its decision by stating that 95% of traffic on its
website came via mobile devices, and that 70% of its purchases were performed on smartphones. The
move received mixed reception, and resulted in a 10% decline in sales. In February 2016,
acknowledging the failure of the "app-only" model, Myntra announced that it would revive its
website.
In September 2017, Myntra negotiated the rights to manage Esprit Holdings's 15 offline stores in
India. Myntra reported a net loss of ₹151.20 crore in the financial year 2017-18.
In January 2021, Myntra changed its logo, after a police complaint was registered that the logo
resembles a naked woman. The complaint was filed by a woman named Naaz Patel, who runs an
NGO called Avesta Foundation.
Acquisitions and Investments
In October 2007, Myntra received its initial funding from Erasmic Venture Fund (now known
as Accel Partners), Sasha Mirchandani from Mumbai Angels and a few other investors. In November
2008, Myntra raised almost $5 million from NEA-IndoUS Ventures, IDG Ventures and Accel
Partners. Myntra raised $14 million in a Series B round of funding. This round of investment was led
by Tiger Global, a private equity firm; the existing investors IDG Ventures and Indo-US Venture
Partners also put in substantial amount towards funding Myntra. Towards the end of 2011,
Myntra.com raised $20 million in its third round of funding, again led by Tiger Global. In February
2014, Myntra raised additional $50 Million (Rs.310 crore) funding from Premji Invest and few other
Private Investors.
In April 2015, Myntra acquired Bengaluru-based mobile app development platform company
Native5, with a view to strengthen and expand Myntra’s mobile technology team.
In July 2016, Myntra acquired mobile-based content aggregation platform Cubeit, to strengthen and
expand its technology team.
In July, 2016 Myntra acquired their rival Jabong.com to become India’s largest fashion platform. In
October 2017, Myntra partnered with Ministry of Textiles to promote handloom industry.
In April 2017, the company acquired InLogg, a city-based technology platform for the e-commerce
sector.
In April 2018, Myntra acquired Bengaluru-based start-up Witworks, a maker of wearable devices to
strengthen its technology team.
In August 2018, Myntra acquired Mumbai-Based start-up Pretr Online Services Pvt. Ltd., an end-to-
end omnichannel platform for retail.
Digital Reality Show (Fashion Influencer)
Launched its first digital reality show "Myntra Fashion Superstar" which is based on the fashion
influencer talent hunt on Myntra app on 17 September 2019. In association with Zoom Studios,
this show will identify & reward India’s next big fashion influencer. Show has eight episodes of
reality series which will see 10 contenders competing with each other. They would also be
mentored and judged by a star studded jury, from the world of Bollywood, TV and fashion,
including Bollywood diva Sonakshi Sinha and leading celebrity stylist, Shaleena Nathani.
As an e commerce fashion retail store, Ajio provides varied trends, styles in best prices. Also, Ajio
deals in in various categories including menswear, womens wear, kids wear, and technology.
Reliance has already created an advanced internet infrastructure through Jio and robust physical
retail business through Reliance Retail. However, in April, 2016, they unveiled Ajio to create a
differentiated e commerce model.
Financial Positions
It had a turnover of ₹337 billion in the financial year 2016–17. Reliance Retail announced revenues
of ₹450 billion for the nine months ended December 2017 for financial year 2017–18, showing over a
90% jump from the corresponding previous period. The company also reported a profit of ₹7 billion
for the period. In financial year 2019–2020, the company reported record breaking revenue of ₹1.62
trillion and EBITDA of 9,654 crore growing 55.7% year over year. The company also became the
country's largest retailer by reach, scale, revenue and profitability.
In September 2020, it was announced that American investment firm Silver Lake has bought 1.75%
stake in Reliance Retail for ₹7,500 crore (US$1.0 billion) valuing the business at ₹4.28
trillion (US$57 billion). On 23 September, it was announced that KKR has bought 1.28% stake for
₹5,500 crore valuing the venture at ₹4.28 trillion or $58 billion.
In October 2020, Singapore's GIC bought a 1.22% stake for $752 million, while TPG acquired a
0.41% stake for $250 million giving Reliance Retail a pre-money evaluation of $58.5 billion.
Acquisitions and Partnerships
On 29 August 2020, Reliance Retail announced that it is acquiring the retail, wholesale, logistics and
warehousing business from the Future Group for ₹24,713 crore (US$3.3 billion) adding
15 lakh square meters of retail space to the company.
On 15 November 2020, Reliance Retail announced that it had acquired a majority ownership of the
furniture and decorating company Urban Ladder.
On 7 October 2021, the company announced its partnership with 7-Eleven to open its stores
in India. The announcement came a day after Future Group announced the end of its partnership with
7-Eleven, citing the inability to meet the target of opening stores and payment of franchisee fees. The
first 7-Eleven in India opened in Mumbai.
On 6 January 2022, Reliance Retail invested $200 million in Dunzo for 25.8% stake.
Subsidiaries
No
Name Note
.
3 Reliance Digital Consumer electronics retail stores. It had 689 stores in October 2014.
5 Reliance Jewels Jewelry retail; it had revenues of about ₹8 billion in financial year 2012–13.
Apparel and clothing. It had revenues of about ₹16 billion in financial year
6 Reliance Trends
2012–13 with a store count of 287.
Reliance
7 It had revenues of about ₹1.6 billion in financial year 2012–13.
Footprint
Hamleys, one of the oldest and largest toy retailers in the world, was
9 Hamleys
acquired by Reliance Retail in 2019.
Reliance Industries Ltd, the oil to yarn conglomerate launched its online fashion portal Ajio.com with
the preview of its collection at Lakme Fashion week in Mumbai.
The show also saw the company unveiling its campaign ‘Doubt is Out’ with five show stoppers which
included actor Sunny Leone, transgender activist, Laxmi Narayan Tripathi, comedian, Bharti Singh,
yesteryear actor, Helen and Suman Sharma, the first woman to fly the fighter plane MIG-35 as it tried
to differentiate.
Isha Ambani, director on the board of Reliance Retail, the retail arm of RIL who has been closely
associated with the online fashion venture from its conceptualisation was present at the Lakme
Fashion week show.
The company has said that it will offer the largest collection of private labels for women online, in an
earnings presentation in January. Some 60% of the merchandise it sells, including national and
international brands and Indie (ethnic fusion) wear, will be exclusively available on the portal, RIL
said in its earnings presentation on Tuesday. The products will be aimed at 18-34-year olds, the
presentation said.
Reliance Retail, RIL’s retail arm is the country’s largest modern retailer with revenues of ₹ 17,640
crore for 2014-15, of which 54% comes from its 616 stores spread across value retail that includes
Reliance Fresh and Reliance Marts. The retailer has a total of 2,621 stores spread across 200 cities
which will be part of its e-commerce drive.
E-commerce in India has witnessed an uptick of 77% between 2020 and 2021 and tier 2,3 cities are
transacting more than ever as per a report by India’s largest conversation media platform Bobble
AI. Bobble AI report is based on over 50 million smartphone users’ (in 640+ Indian cities) data
processed in a privacy-compliant manner. It also revealed that while tier 1 cities dominate the fashion
festival figures, transactions in tier 2 cities like Jaipur, Guwahati, Lucknow, Kochi, Mysore, and
Bhubaneswar are at an all-time high – up 82% over the previous year.
Apart from that, the majority of consumers are between the ages of 26 and 35 accounting for 37%, and
between the ages of 18 and 25, accounting for 26% with 72% males and 28% females. According to
the data intelligence company’s survey on the state of e Commerce in India, which was conducted
across Tier 1, 2 and 3, beauty e-commerce apps usage grew by 64%, whereas fashion e-commerce
grew by 368% over the past year. The festive period has only led the two e-commerce domains to
skyrocket, with at least two transactions completed by shopaholics during the fashion festivals.
In an interesting insight highlighted by the study, India’s fashion e-commerce industry has transformed
from ‘Monopoly’ to ‘Ludo.’ Fashion giant Myntra faced tough competition from its competitive
counterparts, Meesho, Ajio, and TataCliq. While almost 46% of all transactions belonged to Myntra
during the 2020 festive period, Ajio bagged around 69% of all transactions in 2021. The share of
Myntra’s active users, also using Meesho, Ajio, and TataCliq has also increased significantly,
indicating how users are exploring multiple options this year.
The battle of the e-commerce legends, Amazon, and Flipkart is worth noting, with Flipkart’s active
user base rising 83% in 2021 online shopping festival compared to Amazon’s 72%. Despite the fact
that Flipkart is dominating in terms of engagement metrics like search frequency and active sessions,
Amazon is winning in terms of transactions, significantly less average session times.
Apart from fashion e-commerce, interesting insights have also emerged from the beauty e-commerce
segment. Leading players Nykaa and Purplle locked horns this festive season – and Purplle took a
piece from Nykaa’s pie. In light of Nykaa’s IPO, let’s look at their market share against Purplle,
Nykaa’s pure-play fashion e-commerce competitor. Purplle had a 70% growth in active users in the
2021 shopping festival, compared to a 50% increase for Nykaa. With 15% common user base in 2020,
Purplle is now standing at 17% in 2021.
The festive season trends point towards healthy and fast-evolving competition in the e-commerce
market, which bodes well for customers who are looking for high-quality products at affordable prices.
With the festive season coming to a close, it is exciting to anticipate how the competition will pan out
in 2022. With India’s e-commerce market set to reach $120 billion by 2025, the future seems
promising. Hypergrowth is definitely on the horizon for the segment, and according to Bobble AI’s
findings, brands are poised to capture growth opportunities.
Literature Review
ONLINE SHOPPING VS CONVENTIONAL SHOPPING
Consumers who prefer conventional in-home shopping by catalogs, such as mail order, tended to
show high online shopping intentions, whereas people with a mall shopping preference tended to
have low online shopping intentions (Ling et al, 2010).Andersone and Sarkane (2009) The most
important advantages of traditional shopping are that have been identified are the purchase process
and the chance to contact with sales staff and the advantages of e-shopping is that it is money
saving, time saving, comforting and is accessible all around the clock. (Evans, 2011).Neha Jain
(2014)38, In her study, claims that India is likely to see incredible growth opportunities in the
Internet sector's golden age between 2013 and 2018. Since e-marketing has revolutionized the
market, the customers cannot imagine their lives without the internet.
ATTRIBUTES OF E-COMMERCE
In general, online shopping does not rely on the geographical position (neither of the buyer nor of
the seller) but relies on cultural differences and ICT infrastructure. (Charles etal, 2006, Smith et
al,2013).Grandon,E.E.,& Pearson,J.M.(2004) E-commerce is claimed to be advantageous for both
sellers and buyers. Sellers can have large numbers of prospective customers and buyers can have a wide
range available in one location. Burt, S., & Sparks, L. (2003) drew two conclusions, first, most
retailers are now switching to e- commerce itself because it helps to perform better in saving
costs and operations. Secondly, retailers can see consumer reactions to e-commerce. Irissappane,
Aravazhi.D (2004)48, has depicted that the key customer activities in B2C e-commerce are product
search, product selection, comparison shopping, payment authorization, placement of orders, and
after sales service. Few innovative ways to offer online services are personalized web pages, chat
rooms, FAQs, etc. Jarvenappa, S.L., and Todd, P.A., (1997) 54, have analyzed from their empirical
study that most significant advantages of online marketing is the possibility to shop anytime,
anywhere and from any place.
ONLINE SHOPPING BEHAVIOR
Mishra, Sita (2007)26, in her study of 200 internet users based in Delhi NCR, found that although
consumers have a positive attitude towards online shopping but their attitude towards online
purchases is low. Also, consumer demographics like place and sex does not affect consumers’
attitude. However, consumer demographics like age and income do affect the consumer’s attitude.
Rajyalakshmi Nittala (2015) “Factors Influencing Online Shopping Behavior of Urban Consumers
in India” concluded that prospective online shoppers have increased due to the rise in the number
of internet users and online retailers should aim to get maximum market share. Managers may
concentrate on one or more of these viewpoints, depending on their needs. Some methodological
recommendations are also presented by the study that help managers determine what viewpoints to
follow. And technological advancements and convenience are the two factors that play a major
role while shopping online.
CUSTOMER SATISFACTION
Habibur Rahman and LiliHan(2011)in their paper "Customer Satisfaction in E-Commerce A Case
Study of China and Bangladesh" found that businesses devote a great deal to understanding the
customer and there are some complex website designs that should be revamped to enhance
usability, functionality, and security. Mustafa I.Eid (2018) in the report titled “the effects of
customer satisfaction withe-commerce system”They reported that the research results showed that
all established relationships are relevant in their survey in Saudi Arabia, explaining that perceived
value, e-commerce service quality and customer expectations have affected customer satisfaction
with the e-commerce system. Sahal M. SHEIKH, Mehmet BASTI (2015) in the report titled
“Customer Satisfaction in Business to Consumer (B2C) E- commerce: A Comparative Study of
Turkey and Pakistan”, it was found that there is not much difference noticed between the countries
and concluded that e-commerce is doing fairly well to please customers around the world
according to their requirements. Smith, M. Bailey, J. and Brynjolfsson, E. (1999)53, suggests that
online marketing consumer can benefit from price reduction because of the increase in competition
among suppliers. Liu, X., He, M., Gao, F. and Xie, P. (2008), an empirical study on the factors that
influence online shopping satisfaction of Chinese customers suggests that website design,
transaction capability, delivery, information quality, security or privacy, merchandise attributes,
and customer services strongly affects customer satisfaction.
V.Kumar and Denish Shah 2011 have published research paper entitled “Pushing and
Pulling on the Internet “The internet is fast emerging as a domain sales channel. The Internet
is expanding& it influences consumer which shifts the consumer behaviour. It has changed
the way product awareness, developed new modes of product consideration.
JK Corley, Z Jourdan, 2013, The amount of research related to Internet marketing has
grown rapidly since the dawn of the Internet Age. A review of the literature base will help
identify the topics that
have been explored as well as identify topics for the further research.
T. Shenbhagavadivu , 2015 has published the article " A Study on Customer Satisfaction
towards online shopping " focused on understanding the consumer's attitudes towards online
shopping , making improvement in the factors that influence consumers to shop online and
working on factors that affect consumers to shop online will help marketers to gain the
competitive edge over others.
Vikas Bondar, 2015 has published his article on “sales and marketing strategies”. Internet is
a really good thing. The Internet gives people a greater amount of information as we need. It
is the best way to get a comparison of the products that we need. If we are interested in
buying, it is best for us to check the Web sites.
Sharma and mittal (2009) in their study “prospects of e-commerce in India”, mentions that India is
showing tremendous growth in the e-commerce. Undoubtedly, with the middle class of 288 million people,
online shopping shows unlimited potential in India. The real estate costs are touching the sky. Today e-
commerce has become an integral part of our daily life. There are websites providing any number of goods
and services. The e-commerce portals provide goods and services in a variety of categories. To name a few:
apparel and accessories for men and women, health and beauty products, books and magazines, computers
and peripherals, vehicles, software, consumer electronics, household appliances, jewelry, audio, video,
entertainment, goods, gift articles, real estate and services. Ashish gupta, senior managing director of helion
venture partners and one of the first backers of Flipkart as an angel investor: “Flipkart has been absorbing
companies that have some potential (letsbuy, myntra). In that process, some of the bets will go wrong, for
sure. But that is par for the course. The company (Flipkart) is consciously taking bets that allow it to either
grow or eliminate competition that reduces marketing spend and improves economics.”
Objectives
The objectives of the study entitled as “A comparative study of customer satisfaction of Myntra and Ajio”
are as follows:
To identify factors that lead to customer satisfaction on two e commerce platforms, i.e. Myntra and
Ajio.
To identify and analyze customer satisfaction factors between Myntra and Ajio.
To identify and analyze customer complaining factors between Myntra and Ajio.
To understand and compare the customer satisfaction strategies adopted by Myntra and Ajio.
To identify the factors that can improve the customer satisfaction on online fashion retail stores.
To provide relevant suggestions and future recommendations based on the findings.
Research Methodology
RESEARCH GAP
There are multiple studies and research about consumer satisfaction while using e-commerce
websites, and how technological innovations and new marketing strategies along with heavy and
targeted advertising have affected the buying pattern of a customer. As we discussed earlier that
innovations in this industry have been ever growing and so, the satisfaction levels and loyalty is
bound to change with time. The study is primarily focused on two online fashion and lifestyle
websites i.e., Myntra and Ajio.
We still feel that there are some topics and situations where the industry lacks, or maybe enough
research material is not available to justify the relevance of these instances or features.
1. Security of cloud technology in e-commerce.
2. Shift in demand of consumers to more natural and unique products rather than commercial
products due to vast availability of reviews on the websites.
3. Effect of virtual reality on e-commerce in case of clothing products.
4. Quality control on e-commerce websites as there are thousands of sellers on these platforms.
PROBLEM STATEMENT
From the past four years, there has been a sudden rise in automation and new virtual techniques used
by e-commerce players to reduce the cost of manpower and make themselves look more innovative
and superior to the other. Here, many consumers may be happy with the new vibe but the remay be
chunk of people who may prefer the se websites functioning the old way. We tend to find out if
access automation has affected the satisfaction levels of consumers and in what way.
With addition of multiple payment modes, better technical infrastructure of payment and gateways,
enhanced delivery service and much more, we tend to find the increase in the customer satisfaction
and would also carry their search to know which aspect of e-commerce has elevated from the past.
Expected Findings
E-commerce retail stores should add products as per customer demographics and preferences.
Wide range of quality products with affordable prices must be sold.
Creative and catchy advertisements should be created to grab customer attention and increase
customer engagement.
They should focus on timely deliveries because waiting dissatisfies customers.
User interface on websites and mobile applications plays a vital role in customer satisfaction.
Therefore, the companies should focus on the interface and website designing in order to satisfy their
customers.
The companies should also focus on them after sales service in order to find the perfect solution for
the customers’ problem. This will not only help the company in increasing sales but will also increase
customer satisfaction.
Chapterization
Chapter 1- Introduction