Amazon(ian) Experience!

My train was more than two hours late but I reached the station in time. For a change I was ahead of time! I had nothing better to do at New Delhi Railway Station so I started looking through the books and magazines at a bookshop. I had just picked up a couple of books to check, that the salesman at the shop starting throwing books at me from across the counter, literally!

No, he was not attacking me or shooing me away. He was helping me decide which book to buy. And he was good at it. All the books he 'threw' at me, were books of the authors I had read at some point in time. He threw all Malcolm Gladwell books at me. I decided to buy 'blink'. Then as I checked the cover of his last book 'Outlier' I was not impressed and left the book on counter. It was in a plastic cover packing so I could not glance through the pages of book.

The smart salesman immediately brought copy without the plastic cover for me to feel the book.

I was thoroughly impressed. This guy was no more than 18-20 year old. I guess he would not have studied beyond school. Still just by looking at the first couple of books I picked up, he could guess what kinds of book I may like. I agree that I do not have an out of the world exotic taste of books. It was easy to figure out that I was not interested in fiction, or self help kind of books, the ones which sell most. Still I was impressed. He did not talk to me, he did not ask me a question. He just observed couple of books I picked up and he was right on money in his guess.

Then came the Aha moment.
He handed me the book called Black Swan, by Nassim Nicholas Taleb to me. And I could not help smiling. I had read about Taleb's Black Swan theory, but had not seen the book till a day before. I had bought the book just yesterday, it was still in my bag. I was actually reading the book he suggested me!

I felt bad that I did not buy Black Swan from him. But I left the shop with a lot of satisfaction.

It was for no reason a lot of early success of Amazon is attributed to its feature of suggesting books to its users.

Kambakht Internet

Is Internet economy imploding in India? It seems after years of promise, hype and investment, even die hard internet optimists are giving up.

Just sample following:

Tutorvista, which started as an online education provider for India is dabbling in hard core brick and mortar education business in India. It runs schools, trains teachers, and also sells ICT solutions to school in India. TutorVista founder Ganesh says online-only education model will not work in India because of poor internet penetration.

Kyazoonga is an online ticket booking site for movies, sports and other events. Kyazoonga shot to limelight when it offered tickets for IPL matches in the first edition of IPL. In a recent article in Economic Times, one of the co-founders of kyazoonga says, "We realised that selling online only would not work as plastic penetration in India is low."

Most of us would know Rajesh Jain. One of few men in India to have made his money from internet, Rs 499 Crore, all in cash. Having turned an internet evangelist (whatever that means) since then he has been promoting the cause of internet in India. Unfortunately he seems to be fizzling out too. In a series of posts on his , he has outlined the state of internet in India.

He makes some quite familiar points as to why internet economy is in a pathetic state in India, and what needs to be done to make it feel better. State of affairs can be gauged from a statistic quoted in one of his plots - this is known to most on internet industry insiders, but may be a shocker for others. Internet ad revenues are pegged at Rs 500- 600 Cr, of which more than 75% is cornered by three players - Google, Rediff and Yahoo. That leaves less than 150 Crore for all other players put together!

Sate of e-commerce does not look any pretty either. India's total eCommerce transactions are estimated to be Rs 9000 Cr. Of this 38% comes from IRCTC website alone! If you take out contribution of other travel sites, online share trading and b2b commerce one wonders how many people are buying online in India.

Net-net, if you are an internet only business in India, life is going to be tough. Many pieces of jigsaw need to fall in place before you can reap benefits of your efforts.

A lot of us are heavy users of internet in India, and can't imagine a life without it. But it seems internet is going to take many more years in India to realise its potential. Those who stay put may aspire to reap benefits like Rajesh Jain did. Alas, there will be many more who will have to shut the shop before that.