Top advantages and disadvantages of eCommerce in India

Advantages and disadvantages eCommerce
(Last Updated On: July 21, 2023)

We have said it before and we will say it again: eCommerce is not just a trend, but a necessity. But yes, it might not be for everyone. Some argue it depends on your business model and others argue that it depends on the technology available to you. 

Say what you will, there are advantages and disadvantages to eCommerce that every small business owner needs to know. After all, it caters to over 2.1 billion people. 

As per Statista, there are over 20 million active eCommerce sites globally, and it is estimated that 95% of all purchases will be through eCommerce platforms by 2040. 

Statistic: Market size of e-commerce industry across India from 2014 to 2018, with forecasts until 2027 (in billion U.S. dollars) | Statista
Source: Statista

So should you opt for an eCommerce platform for your business? 

Let’s find out, starting with the advantages of eCommerce.

Advantages of eCommerce in India 

  1. No geographical barriers
  2. Safe and secure
  3. Stand out from the competition
  4. eCommerce is more affordable
  5. Marketing is easier
  6. Find customers before they find you
  7. Trackable metrics and goals
  8. Better customer experience

1. No geographical barriers 

Ever since businesses took a hit during the pandemic, online platforms came to the rescue with one BIG advantage – access to customers beyond borders. With an online store or website, your customers can now shop from the comfort of their homes. Thanks to worldwide shipping services that offer minimum fees, customers can place orders via your online store.

Related Read: Shipping strategy for your eCommerce business

With the power of social media and SEO, you can reach more people who are interested in the products you sell.

2. Safe and secure 

The biggest disadvantage of a brick-and-mortar store is the cost of setting up. As a small business owner, setting up a physical store would mean risking your savings. Not only that, a physical store ties you down to that particular geographical location.

With an online store, you reduce risks and save money on maintenance, security etc. Make a one-time investment by choosing an eCommerce website that has a secure payment gateway and is encrypted to prevent hacking or spyware. 

3. Stand out from the competition

Business owners with an online store have claimed that they can easily stand out from their larger competitors.

If you have an online store, you can showcase your unique brand and establish your business as an authority. Even if you have huge competitors, taking your business online gives you a bigger chance to stand out. Here’s how:

  • You can create an eCommerce website with a beautiful theme that matches your brand image
  • Give customers a unique experience so that they come back for more
  • Get your business ranked on Google before your competitors using the power of SEO

4. eCommerce is more affordable 

Yes, you heard it right. Although eCommerce involves technology, it’s surprisingly affordable at this day and age.

You can even get an eCommerce website for free, if you know where to look! More on that later.

The average physical store costs thousands, if not lakhs, to set up. You need to hire storefront employees, pay for plumbing, electricity, maintenance, and more.

However, with an eCommerce website, you get to keep a team working remotely and manage the business without added expenses. You only pay the basic set-up/subscription fee and you can upload an unlimited number of products to your store.

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5. Marketing is easier 

Simply put, eCommerce offers you the power of enhanced digital marketing. From SEO to paid ads, a huge advantage to setting up an eCommerce platform is the varied options that marketing has in store for you. 

And the result? More customers —> more sales—> business growth! 

You can reach customers in EVERY corner of the world and connect to them. With online services like coaching you don’t even have to worry about shipping charges. All you need is good internet!

How to get started with marketing for free? Check out our detailed guide to explore a few FREE marketing tools you can use. 

6. Find customers before they find you

When it comes to marketing for eCommerce, you find your customers before they find you. In a brick-and-mortar store, you rely heavily on customers passing by your brand sign outside the shop.

With an eCommerce storefront, you have a literal 24/7 billboard! 

Start with social media 

According to a recent study, online stores with a social media presence have an average of 32% more sales than those that don’t. If you are new to the online space, it is a good idea to start gathering clout on social media.

Find out what social platform you could start on (we recommend Instagram) and set up your profile. This detailed guide will help you get started with selling on social media.

Ebook on Social media marketing instamojo 2020- advantages of eCommerce

Related Read: How Small Businesses Can Beat Competition

Retargeting your customers

eCommerce Advantage 101 – you learn from your customers. You will learn how valuable your existing customers are, and you will always step out of your zone to communicate with them. 

Differences between retargeting and remarketing
Customer retargeting

Retargeting literally means targeting over 98% of those customers who visited your eCommerce website, looked around, and left without converting to come back and convert into becoming a sale.

Retargeting strategies are only targeted at users who have previously visited your website but have not converted. Having an online store allows you to collect the data (with consent) of those who visited your store and then try and convince them to make a purchase at a later point in time.

Related read: Benefits of an eCommerce website

Cold emails

Do not know who your customers are? Send a random 100 people your online store url and see who responds. Cold emails involve reaching out via email to someone who is not aware of your brand or business.

When you send a cold email, you are inviting someone to check out your brand and digital products so they can become a customer. Email marketing happens to be one of the biggest advantages of eCommerce businesses!

7. Track metrics and goals easily

Earlier, a crowded offline store proved that your sales are doing good. But imagine your online store getting 3x the crowd and you keeping track of it with tools! 

For example, you can get daily online visitors to figure from Google analytics or inbuilt store backend software. You can collect leads online with different tools and campaigns. Remember this, it is not only those who purchase from your eCommerce website that accounts as customers. 

Related Read: Top eCommerce metrics to track and how to grow your business

We all know what window shopping is. In an offline store, someone can walk in, browse through the products, and leave. You will not know who it was and what led them to not buy at all. But with an online store, you have an Abandoned cart! 

Imagine being able to reach out to a customer with their email and nudging them to complete their purchase. Only an eCommerce platform can allow you to do that. 

8. Better customer experience 

Do you know how it feels when you are browsing in an offline store and customers cannot find what they are looking for? 

Fortunately, eCommerce websites have filters, categories, and search bars to help customers find what they are looking for. They can compare prices, and product features, and make a decision without having to hassle a retail worker. Customers can also place a ’notification alert’ whenever an item is out of stock. 

Over 80% of India’s online shopping takes place from a mobile device. Millennials have stated that they prefer shopping on their phones using eCommerce apps for a better experience.

Seamless checkout, guest login, and online payment options (including cash on delivery) are some of the main reasons customers prefer online shopping over visiting an offline store. 

Instamojo as the ultimate choice for over 2 million businesses

The Instamojo premium eCommerce website pricing plan starts at the cost of a glass of chai! That’s right, you can set up an online store for free and upgrade to an affordable premium plan at your convenience. The premium store on Instamojo offers – 

  1. Online payment solutions with over 100+ payment modes
  2. Unlimited product uploads
  3. 20+ themes to choose from
  4. Free in-built marketing tools
  5. Shipping with mojoXpress
  6. Faster payout options

Explore Instamojo premium

Disadvantages of eCommerce (and how it can be conquered)

  1. Lack of personal touch
  2. Lack of trust in quality
  3. Online payments

1. Lack of personal touch 

Even now, a huge portion of India’s population enjoys going to an offline store and talking to staff while shopping.

While eCommerce allows for a simple and easy browsing experience, it also does not allow customers to have complete assurance of the brand/product. They do not get a chance to speak with a brand representative while shopping.

However, with the help of AI, online shopping is on its way to becoming the fun, interactive experience Indians would crave on the weekends with family.

Social eCommerce, Government marketplace trading, and augmented virtual shopping, are some of the few big changes eCommerce will see in time.

2. Lack of trust in the quality

A lot of customers, especially those in India, prefer checking a product physically before buying it. Despite businesses adding all the information on the website, customers take a long time to build trust in a brand they are buying from.

Related read: How to build customer trust online: 8 Solid ways

If the product is expensive, fragile, or far away from the shipping area, customers get nervous about buying online. This issue does not tend to happen in an offline store, where everything from choosing a product to shipping it can happen in a matter of hours.

Fortunately, another one of the advantages of eCommerce includes meeting customer needs, and one of the top priorities is quality. You can doublecheck the quality of a product by going through the reviews and testimonials left by previous buyers.

3. Collecting payments

Collecting payments online can seem easy with the UPI we have today. However, customers have a variety of payment preferences. such as credit cards, debit cards, e-wallets, and bank transfers. eCommerce businesses need to offer multiple payment methods to accommodate their customers’ preferences.

Here are some ways Instamojo can help solve this problem:

  • Use Smart Links or Payment Links to offer a wide range of payments to customers and also collect their shipping information. If you run a business on social media and don’t want to create a website, this is a great option.
  • Install a payment gateway into your website. This can help you collect payments from customers securely.
  • Choose an eCommerce website with an in-built payment gateway like Instamojo.

Returns and refunds

Returns and refunds are a common issue in eCommerce, and handling them can be time-consuming and costly for businesses. In fact, the current eCommerce returns in India are at a rate of 25-40%. Here are a few ways to curb the loss of returns:

  • Have a clear return policy
  • Provide excellent customer service
  • Consider the cost of returns and refunds when setting your pricing and profit margins

Ready to start your eCommerce store? Sign up for free and get started for free.

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