$450 billion retail market by 2015 ( = Italy)

300 million shoppers

Add $3-4 billions in GDP of five years

Lower consumer price 3-5%

Lower waste via more efficient supply chains

Larger tax base1.6 millions retail

jobs

CE – Huge Mkt

Online buyers of ‘non-travel’ products (13.5 million) outnumber ‘travel’ ones (8.6 million)

Most bought ‘non-travel’ products are mobile phones & accessories, computer hardware and consumer electronics

Most bought ‘travel’ products are train tickets and air tickets

Top Categories by Value JAS 2011 Average Selling Price (In USD)

Mobiles & Accessories 72

Computers & Peripherals 82

Consumer Electronics 47

Health & Beauty 32

Jewellery 76

Fitness & Sports 46

Cameras & Optics 89

Kitchen & Home Appliances 31

Apparel & Accessories 20

Memory Cards, Pen Drives & HDD 26

Home, Decor & Furnishings 26

Toys, Games & Baby 32

Watches 42

Books & Magazines 13

Coins & Notes 66

Cars, Bikes & CVs (Accessories) 16

Everything Else 13

Tools & Hardware 23

Musical Instruments 59

Movies & Music 5

Collectibles 19

Travel

3.87mn

22%

Non-Travel

4.7mn 8.76mn

27% 51%

Online Buyers 17.3millionTop 10

USD 81mn/

quarter

Source: Juxt India Online 2011 Study July 2011

Source: Juxt Quarterly Non-Travel Shopping Brand Track & Market Share Estimation

Study (4000+ sample of online non-travel buyers) – JAS 2011

Credit Card – Still Nascent

24% 25% 26% 25%

29% 31%38% 38%

0%

20%

40%

60%

80%

100%

2008 2009 2010 2011

Credit Card Ownership

Net Banking Users

Unique Non-Travel Buyers per Quarter

0.410.62 0.64 0.68

1.07

2.00

1.27

0

1

2

3JF

M'1

0

AM

J'10

JAS

'10

ON

D'1

0

JFM

'11

AM

J'11

JAS

'11

58%

48%

42%

41%

10%

3%

1%

1%

0% 20% 40% 60% 80% 100%

Debit card

Credit card

Net Banking

Cash on Delivery

Cheque/DD on Delivery

e-currency

Cash Card

Others

• Of the 13million around 2million unique people transact in any given month

• Credit card penetration among Internet users is relatively low and remained stagnant

• Users use on an average 2 mode of payments, ‘Cash on Delivery’ is growing and throwing unique challenges

Rate of return

30 to 40%

Source: Juxt Quarterly Non-Travel Shopping Brand Track & Market Share Estimation Study (4000+ sample of

online non-travel buyers)

Factors affecting location

Intended target market

Type of products

Suitability of site for customer access

Characteristics of existing

retail operations

Three most important words in retailing:

Location … location … location!

Consumers want convenience, a subjective measurement

Convenience Measurements - Distance - Parking

- Time - Traffic congestion

= Convenience

Free standing structure

Central Business District (CBD)

Shopping Malls (avg. age 23 yrs 2012)

- Neighborhood shopping center

- Community shopping center

- Regional shopping center

Non Traditional Shopping Center

- Factory Outlets

- Mini warehouse mall

Retail buyers must match their product selection, quality, price with constantly changing consumer wants.

Scrambled merchandising- adding unrelated products to generate traffic & higher margins

- The retail store merchandise must change as consumer wants change

Product Selling Cycles

NB’s…..a relatively short term selling life cycle - (under 3 months)

DT’s….a relatively enduring selling lifecycle - (over 3- 6 Months)

StoreLocation

StorePromotions

StoreLayout/Image

StorePersonnel

StoreServices

StoreHours

The sum total of all store stimuli, interior & exterior physical characteristics that appeal to emotions (psychological field)

Components: Ambient factors, Design and Social Factors.

Ambient Factors (Perceptions)

- lighting

- sounds

- smell

Social factors: In store service (sales personnel social & emotional labor)

- Courteous Rude behavior

- Knowledgeable Low information

- Service Insincere

- Employee dress norms (casual ??)

Make it convenient & pleasurable for customers to shop and pay for merchandise

Personal Service Climate- Calls for a highly motivated,

experienced & well paid work force

- Retail jobs often pay poorly, are not challenging and produce high turnover

8%

30%

33%

29%

7 - 12 months

1 - 2 years

3 - 5 years

5 + years

Average length of employee tenure with retailers

Estimates: 2012

Location + Merchandise + Services + Atmospherics + ? Store Image

Advertising Medium(s)Newspapers - Television - Radio - Magazine - Direct Mail -

Videos-Web

Price and Value

Quality and Selection of Merchandise

Service

Shopping Environment

44%

34%

11%

11%

Retailers Resellers

Exclusive Distribution Intense Distribution

Store Loyalty Brand Loyalty

High Markup +Volume Low Markup/High Volume

Love - Hate Relationship

Perusa Yusii