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How to Start Online Business in India

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Thinking to start an online business in India? Wondering which type of online business should you venture in? You can rest all your queries and concerns because here we provide a wide variety of options to choose from as the scope of e-commerce is huge and lucrative. With numerous online business opportunities available in India, we will help you in making the right choice that best suits your business requirements! Before that, let’s have a look at the future of E-commerce in India-

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Future of E-Commerce in India:

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Internet users in India

With increasing smartphones and internet penetration, the e-commerce industry is witnessing tremendous growth.

  ‘Growing At 19%, Indian Ecommerce Market Hits $33 Bn: Economic Survey 2018’

Looking at the aforesaid statistics, the future of e-commerce in India looks really bright and promising. Isn’t it? Let us have a look at some interesting facts that will incline you more to set-up your online business in India:

  • Interestingly the Indian e-commerce industry has been on an upward growth trajectory and is expected to surpass the US to become the second largest e-commerce market in the world by 2034.
  • The e-commerce market is expected to reach US$ 64 billion by 2020 and US$ 200 billion by 2026 from US$ 38.5 billion as of 2017.
  • With growing internet penetration, internet users in India are expected to increase from 481 million as on December 2017 to 829 million by 2021. Rising internet penetration is expected to lead growth in e-commerce.
  • India’s internet economy is expected to double from US$ 125 billion as of April 2017 to US$ 250 billion by 2020, majorly backed by e-commerce.
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Digital Marketing in India

After going through the data, you must be lured to kick-start the process of how to start online business in India, aren’t you? So, let us now know the basic steps involved in the process of ‘how to start an e-commerce business in India

Advantages of setting up E-commerce Business in India:

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Benefits of Doing Business Online

A.) Growing Demand

India is the fastest growing market for the e-commerce sector. Being involved by a young demographic profile, increasing internet penetration and relatively better economic performance. India’s E-commerce revenue is expected to jump from US $39 billion in 2017 to US$ 120 billion in 2020, growing at an annual report of 51% percent, the highest in the world.

B.) Increasing Investment

The recent arise in digital literacy has led to an influx of investment in e-commerce firms, levelling the market for new players to set up their base, while churning out innovative patterns to disrupt old functioning.

C.) Attractive Opportunities

India’s start-up ecosystem is growing supported by favourable FDI policies. Government initiatives like Startup India and Digital India, as well as rising internet penetration driven by market players like Reliance Jio.

To sustain the stiff competition in the industry, online e-commerce business startups must surely take a sneak peak into the do’s and don’t of Digital Marketing for E-commerce.

If you wish your e-commerce business to make a mark in the industry, understanding of market and consumers is a must. For that, take care of the Don’ts of Digital Marketing for E-commerce:

Don’ts of Digital Marketing for E-commerce:

  • Do not set up your E-commerce business to sell a hoard of products out there in the market.
  • Do not build a website without a strong Digital Marketing plan.
  • Make sure you do not spam your customers with multiple pop-ups.
  • Don’t decide your marketing strategy based on assumptions.

Do’s of Digital Marketing for E-commerce:

  • Speed Up Your Online eCommerce Website
  • Always use quality product images
  • Build a handy email list
  • Showcase precise product information: features, price, etc.
  • Have more human-oriented offers instead of competition oriented offers.
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3 R’s of Successful E-commerce Business

Enlisted below are the basic steps involved in the process of ‘How to Start an Online Business in India’.

Steps to Start Online Business in India:

Step 1: Design an E-commerce Business Model

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Design E-commerce Business Model

Planning out and designing an e-commerce business model is the base when thinking to set-up an online business. The business model should be drafted such that the details pertaining to the business concept, market research, marketing plan, operations plan and financial planning are all taken cared of, adequately.

Step 2: Choose Product/Service to Sell Online

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Choose product to sell online

To make a choice of the product/service you wish to sell is one of the crucial moves.

The next important step is to identify the platform for selling the product/service. Either sell on your website or sell on marketplaces. Interestingly, opting for the latter, paves an easy way to start an e-commerce business as the sellers can join multiple marketplaces to sell their products.

Some of the popular marketplaces are Flipkart, Amazon, Snapdeal, PayTM, Shopclues, etc. If you want to sustain the competition in the online business industry, you must know how to sell on Flipkart, how to sell on Amazon India, How to sell on PayTM and how to sell on Snapdeal.

Above everything else, you must ensure to choose the most demanded products in India.  

Step 3: Do Market Research

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Market Research

Wondering how to do Market Research? Worry not, here is the quick checklist:

  • Decide upon the product/service you plan to offer
  • Study the demand of that product/service
  • Identify the possible number of competitors
  • Conduct customer surveys either via phone or personal visits, as is feasible
  • Find out if there is a market need that has not been met.

Formal marketing research simply makes this a familiar process orderly. It provides a framework to organize market information for the best selling products online in India.

Step 4: Understand the dynamics of the Online Business Model  

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Online Business Start-up Cost

Moving on further in the process of how to start online business in India, it is important to list the capital to be invested besides other costs involved in setting-up the e-commerce business in India.

The cost of starting an online business in India varies basis the type of service being offered. However, there are a few costs involved that are incurred by online businesses in India, generally:

  • Market research cost
  • Web-hosting charges
  • Email Marketing Services
  • Website designing cost
  • Human resources
  • Cost of manufacturing product(s) offered
  • Warehousing expenses
  • Logistics charges
  • Traditional Marketing cost
  • Business taxes
  • Accountant and financial institution fees
  • Rent and utilities

So, make a thorough provision of funds to ensure smooth workflow.

Step 5: Establish Your E-commerce Business Legally

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Establish E-commerce Business Legally

a.) Decide upon the legal structure of your Online Business

Legal formalities must be duly fulfilled before you start running your e-commerce business. For this, decide upon the structure of business entity you wish to run: sole proprietorship, partnership structure, Limited Liability Partnership (LLP) or a Company format.

b.) Enquire if you need to get a tax identification number for your business

Once you’ve finalized upon the business structure, the next important thing is to inquire about tax return details. If you’ve opted for a corporation or a partnership based structure, then you must file tax returns and have a tax ID number. While the sole proprietors need not have a tax ID number instead, they can use the Social Security number allotted.

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c.) Get the necessary licenses and permits to run your Online Business

Furthermore, it is equally important to obtain the necessary licenses and permits to run your online business, which may vary depending upon the city requirement. For instance, if you are offering to account for financial services, you will need a license in most of the states.

Step 6: Set-up your E-commerce Website

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Set-up your E-commerce Website

a.)  Decide whether to do Self-hosting of the website or outsource

Self-hosting a website is beneficial for the simpler form of e-commerce businesses in India like content writing, parenting tips, motivational thoughts etc. While, if your e-commerce business is exclusively online, you must consider hiring a professional or outsource the website hosting task to get a polished website. The latter being a little more costly than the former option, accordingly define your budget.

b.) Upload the product & services details

Once the website hosting is completing, jump onto publishing the relevant content:

  • Details of fast selling products in India – pictures, and descriptions in detail
  • Company objective (to differentiate you from your competitor)
  • E-commerce business history and personal bio
  • Blog or any other additional content you plan to add
  • An engaging shopping cart and details defined on the payment gateway

c.)  Work upon the SEO of your Online Business website

Trading in e-commerce business in India will be incomplete without defining the SEO strategy. Both on page SEO and off page SEO activities carry importance

  • Add relevant keywords, that prospects must be searching for. You can do this by accessing tools like Google Keyword Planner, SEMrush, etc.
  • Have both internal as well as external links in the website. The external links must be that to authoritative websites such as Wikipedia, or other relevant websites based on the type of your online business.

Step 7: Draft Marketing Strategy

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Online Business Strategy

Everything sorted, said and in place, it is now time to take the actual action! And that is- spread a word about your newly launched e-commerce business. Elements of a successful online business strategy are:

  • Eye-catching design
  • Advertising techniques
  • Email Marketing activities
  • Website monetization
  • Analytics & online traffic analysis
  • Online PR
  • Search Engine Optimization – on page and off page
  • Social Media Marketing

Amongst the aforesaid, we’ll highlight upon 2 important activities:

a.) Identify free sources- Social Media

After the website, it is the social profiles of a business that customers check out! So, cash upon the free sources to make a mark in the minds of your prospective customers:

  • Create a Facebook page.
  • Have an active Pinterest account (especially if dealing with fashion, travel, food-based business)
  • YouTube is another most effective platform that generates interest via audio-visual interaction.
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Use Social Media for E-commerce Brand

Most of all, being active on the Social channels is what matters the most instead of merely having a presence. So, understand the fact that it is important to keep your followers updated with the new product launches, sale or any other important business information that they must know. 

b.) Make money from AdSense

Another assured way to start making money from your online business in India is to start running ads on the website. Following steps will help you start making money from AdSense:

  • Join any affiliate network (Commission Junction, ShareASale ClickBank and so forth).
  • Apply for different affiliate member programs in a speciality (e.g. Payday Loans, or Web Hosting and so on).
  • Promote the affiliate program that offers most extreme payout and with a decent reputation.
  • Sign-up for Google AdWords (utilize free coupons)
  • Start your promotion campaigns by making advertisements and correct keywords (use long tail keywords)
  • Your advertisement(s) will show up on real Pay Per Click web search engines like Google, Yahoo, Bing, etc.
  • Potential clients will click on your advertisement and finish a deal.

You will learn how to earn from Google AdWords, as you will earn the commission by means of an affiliate network that ensures the deal of best-selling products online in India.

Step 8: Test & Launch  

Well, now it’s time to do the test run of your website and check for any loopholes. Once sorted, you are all ready to launch your online business.

Now, you are all aware of the tit-bits on how to start e-commerce business in India. Do not miss out on any step to ensure smooth set-up of your online business.

Good luck!

Image Credits: slideshare.net, brandsvietnam.com, bluefountainmedia.com

[Sr. Associate – Content Marketing]

A content passionate, Jasleen handles content writing & marketing activities. Also, she leads Digital Marketing Internship Program. She is in the content writing and marketing fraternity for 6+ years now & is proficient in writing content for blogs, articles, books, brochures and social media. She embraces practical knowledge of WordPress CMS.

  • Digital-Marketing


  • There are 5 comments


    • 7 months ago

      RAMESH KUMAR   /   Reply

      Hello Jasleen Kaur This blog is very useful for me .
      I am a student of B-tech computer science and i learned many things from you .Thanks again for this blog

      • 2 months ago

        Jasleen   /   Reply

        Hi Ramesh,

        Glad to see that you benefited from the blog. Can you share your learnings so that others can also reap the benefits out of the same?

        Good luck!

    • 3 months ago

      Stanley Joel   /   Reply

      Hello Jasleen Kaur This blog is very useful for me as I am starting my own e-commerce business.

      • 2 months ago

        Jasleen   /   Reply

        Hi Stanley,

        That’s great. Which e-commerce business have you ventured in? it’d be great if you could share your experience with us.

        Good luck!

    • 2 months ago

      Rajkumar   /   Reply

      Hello Jasleen
      Thank you for your valuable info.
      I am planning to set up a e-commerce related to spectacles.

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