The digital ‘Desh ki Dukaan’ paves a new way for grocery shopping

The introduction of Jiomart in the market:

desh ki dukaan, jio mart to launch soon

In January 2019, chairman of the Reliance Industries, Mukesh Ambani announced that the company would be collaborating with various startups, merchants, vendors and other offline logistic companies to create an infrastructure for a new e-commerce platform that would connect almost 90 per cent of India’s population to the latest ‘Desh ki Dukaan’

It is said that the company is set to create a hybrid offline and online business model by amalgamating the physical marketplace of Reliance Retail with Reliance Jio’s digital infrastructure.

Features adopted by the company to survive and outlast the market:

The most important feature of the upcoming online grocery website portal is that it is aiming to get profitability from all the strata of the Indian society.

According to Ambani, the scope of profitability from this platform is around 700 billion dollars and it also claims to be connecting around 20 crore Indian households. Such a precise and discreet target wasn’t aimed at, by other website portals like BigBasket or Amazon. 

In order to survive in the market and also to eliminate its existing relevant competitors like Amazon, Flipkart, BigBasket and Grofers, Jiomart is employing the following strategies:

  • Jiomart is inviting its telecom service Jio users to pre-register at its official website and thereby receive a discount up to 3000 bucks (INR).
  •  The company is also employing other marketing strategies to survive and strongly establish itself in the Indian e-commerce platform.
  • The online grocery website will be cataloguing around 50,000 grocery products.
  • Free home delivery against no minimum order value will also be provided.
  • It will be employing electronic vehicles for fast delivery fleet and will also be collaborating with offline logistic companies like Grab and C – Square.

Currently, Jiomart is operating in Navi Mumbai, Kalyan and Thane. It is expected that by the end of this year, the company will eventually grow and expand its operations to a national level.

The present condition of the Indian E-commerce space:

Myriad companies are now filling the Indian e-commerce platform with each one trying their best to survive and eliminate one another by meticulously employing specific marketing strategies. As a result of this intense competition, the platform is flourishing at a far better level because of the newly adopted methods of each distinct company.

Flipkart 

For example, after the announcement of Jiomart, Flipkart is gearing up to establish a pilot in Hyderabad.  It is said that the company would be providing fresh fruits and vegetables by collaborating with its vendors. Flipkart wasn’t a segment of this vertical until now. It has decided to partner with WayCool Foods & Products and is planning to launch their portal first in Hyderabad followed by Bengaluru, Chennai, Delhi and Pune.  

Amazon

Similarly, Amit Agarwal, the head of Amazon India said that the company would now broaden its expansion by concentrating on producing fresh fruits and vegetables in the online market.

It is said that in the next five years, this segment will take over more than half of their business through the newly strategized Amazon Now.

BigBasket

BigBasket has also risen a 300 million dollar Series E funding and has included 34 startups in the company in order to gain maximum profitability from their aspect. Grofers, which currently exists in 26 cities in India, has already raised 180.2 million dollars funding.

The effect of Jiomart in the Indian e-commerce space:

The Game of Market Share

Currently in the online grocery market, it is said by reports that BigBasket has 35% share in it, with Grofers and Amazon having 31.5% and 31.2% shares respectively. Flipkart will also be joining this segment of online grocery market by this year. Therefore Jiomart will be having four e-commerce giants to rival with.

So what?

Yet, there is a high chance that Jiomart will be ahead of most of these companies. We have seen Reliance Jio do this before with their online telecom services. It is not totally impossible for the largest company in India (by revenue) owning the third largest mobile operator all over the world to take over this segment of the market too.

The JioMart Customer Aquisition Strategy

Ambani's increasing reliance on Jio
source: Statista

They shall be using similar strategies to gain success in this vertical too. The initial target of the Reliance Industries is to utilize the 369.93 million subscribers that it had acquired through Reliance Jio and give an imposing exposure to their customers as to how grandeur yet simplistic their new online grocery website portal is. It is expected that they would be aiming at a low price – high-frequency work at the initial stage.

The Fear

The introduction of Jiomart has thereby affected a lot to this segment of the market. In order to eliminate each other, each company is thereby making more improvements in their business models by including offers and concentrating on unique features of their products that would differentiate their products from the other existing ones in the market.

Impact on the existing E-commerce sector:

This new e-commerce platform would also be having an effect on the economy of India. If Jiomart collaborates with local vendors, merchants and other startups, as they said they would, then these common people would get exposure and would be able to rightfully sell their product if the company works steadily.

Thereby a healthy ecosystem would be established with the common men having a scope to gain profit too. According to Chairman Mukesh Ambani, this venture would give an opportunity to 30 million small merchants all over India to help the company connect the physical market with the digital world.