eBay wants to change India's online shopping habits

E-commerce site hopes to change Indian users' online shopping habits from buying goods with lower profit margin to higher margin products such as clothes and shoes, says report.
Written by Liau Yun Qing, Contributor

eBay is looking to tap potential growth in India by enticing online shoppers in the Asian economic giant to purchase goods that yield higher profit margins. 

A Wall Street Journal report Thursday said the e-commerce and online payment company is looking to change India's online shopping habits from buying electronic gadgets and books which have lower-profit margins and require less frequent purchases, to buying high-margin products such as clothes and shoes.

The report noted that 80 percent of eBay's Indian transactions were from the sales of new fixed-price items such as cameras, cellphones, laptops, music players, and flat-panel televisions.

Muralikrishnan B., the company's India country manager, told the English daily: "[India] is among the fastest-growing markets and has been identified as one of the significant potential markets for the company." However, he did not share how much of eBay's profits derived from the local market or how much it had invested locally. He also did not elaborate on how the company was working to entice Indian online shoppers to purchase higher profit margin goods.

Citing figures from Technopack, the Wall Street Journal said India's online shopping market was expected to reach US$70 billion by 2020, an increase from US$600 million currently which accounted for only 0.05 percent of the global market.

U.S. online retailer Amazon also entered India's e-commerce market early last month with the launch of Junglee.com, which allows consumers to browse for products online and purchase items either online or in person. Following its entrance into the Indian market, local e-tailers joined forces to compete against the U.S. giant.

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