BOMBAY -- One e-commerce company is learning by experience that
overseas sites set the trends, but local consumers wear the trousers.
Nasdaq-listed Rediff.com India Ltd., the only Indian Web site so far to
raise money in the U.S. stock market, is India's answer to Yahoo! Inc.
-- a news and search portal with shopping services, catering to Indians
both at home and abroad. So there was confusion when many
shoppers reported they couldn't find what they wanted through the
site's search engine. It turned out that the standard e-commerce
software Rediff was using couldn't handle Indian-English peculiarities,
such as substituting "trousers" for "pants." Rediff had to build its own
search engine.
It's just one way the five-year-old company is
learning to balance lessons from India and the
West. Rediff's 52-year-old founder, Ajit
Balakrishnan, an advertising veteran (Rediff's
names comes from Rediffusion Advertising Pte.,
an agency Mr. Balakrishnan founded in the
1970s), makes frequent trips to the U.S. and
online visits to U.S. market-research sites, to
find out what is and isn't working for U.S.
e-commerce sites. A generation older than
most of India's Net mavens, Mr. Balakrishnan is
considered something of a business guru within
the country's Internet community. He says
investors tend to be strict about not letting
sites repeat the mistakes made in the U.S.
"The source of capital goes back to Wall
Street," Mr. Balakrishnan says. "That received
wisdom is spread throughout."
Though grateful that India has been spared some e-commerce
bloodletting, Mr. Balakrishnan thinks it would be wrong to adopt
America's latest lessons wholesale. India's e-commerce business in
2000 is like America's in 1997, he says: Consumers are just starting to
trust that credit cards can be used safely for Internet purchases, and
the overwhelming majority of online-shopping excursions end without a
sale.
Cart Unknown
A recent survey done by the company showed that just four of every
100 people entering Rediff's site actually put something into their
shopping cart, and 93% of those who put something into their cart
moved on without buying. This figure, the so-called drop-off rate, is
between 60% and 80% in other countries, says Mr. Balakrishnan. It
occurred to Rediff officials that the cart itself might be the culprit.
The
shopping cart was an easy metaphor in the U.S., but India's shops are
generally too small for shopping carts.
And so, the Rediff team is redesigning the shopping site, with one eye
on American Web sites, another on local conditions. On a recent visit,
a
prototype is under construction at designer Zereh Lalji's desk, in
Rediff's headquarters in a squalid central Bombay neighborhood. Ms.
Lalji, 26, has been with Rediff since graduating from Bombay University
with a master's degree in sociology in 1997 and teaching herself Web
design.
She rifles through a printout of the seven Web pages viewed in the
course of purchasing a camera on Amazon.com, and says, "It would be
disastrous if you had something like this in India," where Internet
connections are shaky. (Rediff says sales jumped more than 60% when
it collapsed its nine shopping steps into three.) But she also borrows
something from a U.S. online grocer, Webvan.com: a shopping list that
stays in the same left-hand spot while the user shops. Indians will
identify more closely with a shopping list that remains on the screen
while they shop than a shopping-cart icon they have to click each time
they want to consult it, the company believes.
Mr. Balakrishnan says the 24-hour help number should be highlighted
for emphasis. Ms. Lalji experiments with a vibrant yellow. "I would love
to see no words in the instructions," he says.
Fewer Words
Rediff's bet is that stripping away words -- including most product
reviews -- will help customers proceed undistracted to the electronic
checkout. "The first 10 million users were relatively sophisticated," Mr.
Balakrishnan says. "The next 10 will never be more sophisticated."
Though Rediff has yet to earn a profit (net revenue for the quarter
ending in December was $1.75 million), analysts expect it to turn
profitable this year.
It is at the elite level that the American experience transfers best. For
example, Mr. Balakrishnan predicted Indians would protest the same
way Americans did at the idea of having their Web clicks tracked for
marketing purposes. "The kind of people who react is not the public at
large, but the 1% who care, and that 1% is very similar throughout the
world," he says. So Rediff decided to track only a customer's actual
purchases.
When it comes to using the information to suggest future purchases,
Rediff won't be able to use the U.S. as a template. Not only is the
number of shoppers much smaller than in the U.S., but the market is
more complex. By the time it divided up its Indian-pop and
traditional-music selections by region and style, for example, Rediff had
no fewer than 300 categories.
-- Daniel Pearl