Will Jio Flip the E-Commerce Kart?

Will Jio Flip the E-Commerce Kart?

In the e-commerce world, the only two most talked about reigning kings have been Amazon and Flipkart. The scenario might change considering Reliance’s (Reliance Industries Limited) proposed entry in the e-commerce space. Soon one might see Reliance controlling pretty much everything we consume, be it data, apparel or consumer durables. But how will RIL manage to give a tough fight to the existing giants?? The strategy is to integrate Reliance’s Retail business expertise with its Digital Services capabilities. The Ambani scion, with a strong desire to boost the Kirana shop owners and other small traders, is planning on coming up with a hybrid Online-to-Offline (O2O) commerce platform.

O2O model helps the customers to choose what they want to purchase in an online environment on an app or a website, but before purchasing, they can also visit the store offline, have a good touch & feel of the product, compare it with multiple other products on a real-time basis. Doesn’t that sound amazing?? It can solve quite a number of doubts which arise when you are buying products online.

Mr. Ambani has shared his business idea with media after the Indian Government enforced new regulations on the operations of foreign companies in the e-commerce sector. One of the clauses from the policy says “An entity having equity participation by e-commerce marketplace entity or its group companies, or having control on its inventory by e-commerce marketplace entity or its group companies, will not be permitted to sell its products on the platform run by such marketplace entity.” With this, e-commerce players are currently facing tough times, and now with Reliance’s proposition, current giants are in for some real battle ahead.

Back when Reliance launched Jio in the Indian market, it made one thing quite clear: they are not afraid of taking risks & have the skill set to take care of the consequences. This time Reliance is betting on their O2O e-commerce strategy. One can call it the union of Carriage and Commerce. It is a known fact that Mukesh Ambani plays to win regardless of the costs. Over and above this, how can we forget the countrywide outlets owned by RIL where they sell various items – including grocery, garments, and electronics? These outlets will probably serve as Point Stores. The consumers can collect their order from the point store, or the Jio store executive shall deliver the order to the doorstep of the consumer. On top of that, Reliance will leverage the vast presence of Jio’s network across India.

Undoubtedly the O2O proposition is all good, and with this, Reliance will give a tough competition to the existing players but the point to think of is: Will it replace the pure online model?? Won’t other players too try to come up with similar models to revamp the way they have been working?? Currently, it is too soon to answer these questions.

Reliance is most likely coming up with a plan of action from where it can make a grand debut into an online business. The alliance of Jio Point Stores in the distribution network might turn out to be the icing on the cake. What that means for Amazon and Walmart-owned Flipkart will be interesting to see. Hopefully, in this retail slugfest, the real winners will be India’s consumers.

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