As Online Shopping Booms, Big Brands Turn to E-trailers for Consumer Insight

Say data from online retailers cost a fraction of the hefty fees market research companies charge

When Philips India recently launched a specially designed entry level shaver targeted at male consumers in smaller towns, what convinced the Dutch firm about its market potential was data culled primarily from ecommerce and search sites, validated by its own research.


A Philips official said tracking sales and browsing data of such products helped the firm notice high interest in shavers in tier-II towns and the features and price range they were looking for, which convinced the firm to roll out a new product with a starting price of . 900, about 40% less than the previous ` entry-level product.


Consumer electronics companies, smartphone makers, apparel and lifestyle brands are increasingly sourcing consumer data research from e-commerce firms on the back of rapid growth of online shopping and product searches in the country, pitting the likes of Flipkart and Snapdeal against market research firms such as Nielsen and GfK.


“Big data gathering has been a key goal for major e-commerce players. Now that a significant data has been gathered, companies have started mining insights and actions from this big data,“ said Sachin Oswal, co-founder and chief operating officer of ecommerce firm Infibeam.


He said apparel and jewellery brands use “purchase data“ of customers to plan new product styles, including material and colour, based on its analytics system, while electronic brands are using it to plan inventory levels. Brands are also diving into the shopping history and reaching out to consumers via personalised newsletters and notifications, Oswal said.


Several consumer electronics brands including Canon, Samsung, Panasonic and Sony have either tied up with ecommerce firms, or plan to do so, to tap into their goldmine of consumer data. Panasonic India MD Manish Sharma said the company plans to tap consumer insight from online sales for product development, creating pricing and launch strategies. “We will primarily use it for televisions, smartphones and beauty care products,“ he said.


Brands say data from online retailers cost a fraction of the hefty fees market research firms charge. Often it comes at no cost if they have direct business agreements with the retailer.


Many brands already avail data analytics services of search major Google, which is often the starting point for a lot of e-commerce transactions. Canon buys consumer surfing data on cameras from Google to understand what features, colour and specifications consumers are searching. “This kind of data analytics is insightful for our planning and strategy ,“ said Alok Bharadwaj, executive VP at Canon India. “However, the next big wave of research will be the e-commerce websites where consumers have a much deeper level of engagement,“ he said, adding that Canon plans to soon tap e-commerce sites too for data. Almost one-fourth of DSLR camera sales here take place online.


Vivek Sharma, VP and head of marketing at Philips India, said that since many e-commerce platforms have transformed into marketplaces where goods are sold by multiple vendors, sharing of data from these platforms is governed by different set of guidelines. “We rely equally on our own consumer research and analytics across digital mediums and social networks to gain consumer insight,“ he said.


Radhika Ghai Aggarwal, co-founder of online retail website, said merchants registered on its e-commerce platform have access to a wealth of data that gives them store analytics, sales data, promotions tracking and invaluable customer insight. “The fact that e-tailing can be integrated seamlessly with other digital media like mobile and social, is a big advantage for new brands in the market,“ she said.


The size of India's e-commerce market last year was estimated at around $13 billion. The market is expected to reach anywhere between $50-70 billion by 2020, growing 70%-80% a year. There are currently 243 million internet users in India. As per estimates, the number will touch 500 million by 2018

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