Big battle of Reliance vs Amazon set to begin? Mukesh Ambani reveals his plans - Top details in 10 points
Richest man of India Mukesh Ambani with his Reliance Industries is gearing up to take on the world's largest e-commerce company Amazon. Chairman of Reliance Industries Ltd (RIL) mentioned his next vision at the inaugural function of the Vibrant Gujarat Global Summit in Gandhinagar. According to Ambani, Reliance will create a new e-commerce platform for 12 lakh (1.2 million) retailers and store runners in Gujarat, in the next 12 to 18 months across the country. According to a report by Morgan Stanley, India's e-commerce market can grow by 30 per cent a year to $200 billion in the next 10 years up to 2027. The target is easily achievable with increasing usage of the Internet and smartphones in India, offers, and discounts by online retailers for everything from basic groceries to large electronic devices. The company is already working on the trials in six cities including Mumbai, Kolkata, Chennai and Bengaluru.
1. New e-commerce platform
Reliance will be launching a new e-commerce platform for about 1.2 million retailers and store owners in Gujarat, catering them the online retail business services. The plan is to create a nation's largest retail-based network by bringing both offline and online chains on a single turf. As per experts, the move is direct competition to e-commerce giants like Walmart Inc.-controlled Flipkart, Amazon.com Inc, and Alibaba Group Holding Ltd-funded Paytm Mall. Photo: Reuters
2. Double power by combining Jio and Reliance Retail
The platform will be a combined product by Reliance Jio and Reliance Retail, creating a base for online and offline retail services. The company will use the power of both Jio' consumers and Reliance Retail's national reach to fuel the new vision. “Jio and Reliance Retail will launch a unique new commerce platform to empower and enrich our 12 lakh small retailers and shopkeepers in Gujarat,” the Reliance chairman said at the event in the state on Friday. Photo: Reuters
3. Starting with Gujarat
The platform will start from Gujarat, this will likely to help Reliance's new e-commerce venture as the state has a huge community of traders and retailers. “Our new commerce platform will empower small traders, shopkeepers, store runners in Gujarat, which are part of the over 3 crore community in India," Ambani said. Photo: PTI
4. Jio's consumers base
Reliance Jio is a huge success. It has over 4,000 outlets nationwide, which will be scaled up to 10,000 over a period of time. Jio currently has 280 million telecom subscribers. The base will be highly productive for creating a new retail chain. Photo: Reuters
5. Reliance's retail reach
RIL has a massive retail space in the country with over 10,000 Reliance Retail stores across more than 6,500 Indian cities and towns and about 50 warehouses. The company’s wholesale stores will help stock the small and daily run retail stores. The small store and daily shop owners have about 90 percent of India’s retail landscape. The platform will use the base as the delivery based network pan India. Photo: Reuters
6. Use of next-gen technology
Reliance is focusing on next-generation technology to form its new online platform. Ambani revealed some details of his plans in e-commerce in July 2018, where he said the new platform would use augmented reality, holographs and virtual reality to create an “immersive shopping experience.” Photo: Reuters
7. New foreign investment restrictions
Under the new e-commerce policy, firms in India will from February 1st not be able to sell products via companies in which they have an equity interest or push sellers to sell exclusively on their platforms. The rules are likely to affect the business of Amazon as well as its rival Walmart and some other similar companies. However, the move could benefit the local upcoming player, Reliance. Photo: Reuters
8. Importance of data
E-commerce is highly dependent on user data. The online retail chains do target the data to generate sales online. The base of over 280 million Jio users will be highly beneficial for the creation of this channel. “In this new world, data is the new oil. Data is a new wealth. India’s data must be controlled and owned by Indian people and not by corporate, especially global corporations," Ambani said. “For India to succeed in this data-driven revolution, we will have to migrate the control and ownership of Indian data back to India, in other words, Indian wealth back to every Indian," he said. Photo: Pixabay
9. B2B and B2C business
The online retail businesses are running on the basis of two types of retail selling, i.e B2B (Business to Business) and B2C (Business to Consumer). Large chains like Amazon, Flipkart, Alibaba, Paytm etc work on the same platform. They operate a single turf to cater consumers and traders, willing to purchase online. “E-commerce is not about products. If you look at Amazon’s success, it is more about B2B than B2C. Using Reliance Jio, RIL has already created a superhighway. Now they have to ride on this to create online e-commerce," said Piyush Kumar Sinha, a retail expert and director of CRI Advisory and Research. Photo: PTI
10. Digital India
The Indian government has been highly pro-active on digitalisation pan India. Promotion of cashless India, providing internet connections, increasing use of smartphones, rising digital literacy is at peak. Therefore, the digital transformation can do wonders for Reliance to make its e-commerce setup, a huge success. Photo: Pixabay