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Future Of Car Retailing in the Indian Automotive Industry

  • September 2014
  • 57 pages
  • Frost & Sullivan
Report ID: 2370838


Table of Contents

More Automakers are Expected to Use Online and Digital Modes to Complement Traditional Sales

This Market Insight finds that car companies in India will increasingly apply an omnichannel strategy to help market and sell their cars to customers. New cars will be sold via a number of channels, leveraging existing dealer networks and new flagship stores, as well as online and mobile channels. Since 2006, about 4,500 new cars were sold online. India has the potential for implementing the "online retailing” concept in its automotive industry as the Internet caters to all kinds of social groups. Internet usage in rural areas remains a challenge, but rural areas show potential for the automotive industry.

Key Findings
1 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 2013. Online retail sales generated $ billion in 2013.
2 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.
3 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.
4 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.
5 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.

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.

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