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Can JioMart beat Walmart and Amazon in India?

Question asked by Kaustubh Katdare in #Coffee Room #Startups & Business on Jan 1, 2020
Kaustubh Katdare
Kaustubh Katdare · Jan 1, 2020
Rank A1 - PRO

What are your views on JioMart becoming a challenge for the likes of Walmart (owners of Flipkart) and Amazon in India? The JioMart is a joint-venture between Reliance Retail and Reliance Jio which are a part of the Reliance Industries Group. 

The JioMart is promoting itself as "India Ki Nayi Dukan" aka the New Store For India. It currently has about 50,000 grocery items and is promising speedy express delivery. What's interesting is that there is no minimum order value to get home delivery.

It's no brainer that the JioMart will expand to all parts of the country; but for now it's available only in Navi-Mumbai, Thane and Kalyan. 

What would Ambani do differently with JioMart to snatch customers away from Amazon and Flipkart? 

Posted in: #Coffee Room #Startups & Business
Mohit Patil
Mohit Patil · Jan 1, 2020
Rank C2 - EXPERT

I've a friend who works at Reliance. He said they don't know about the plan in detail but there are speculations that Ambani and Co are taking a very different route than traditional commerce. 

Reliance controls both Retail and already has big presence in the digital space. JioMart will adopt the Swiggy / Zomato model for delivery of grocery. First they already have Reliance Stores at prominent locations in almost every city. They will now employ delivery boys all over and enable purchase through JIO mobile app.

Customers will place order through already installed mobile app - Jio. Once the order is received, Jio will assign the order to the delivery boys who will quickly pick up the order from the reliance store and deliver it to the customer. 

In this way, Jio can beat almost every other ecommerce player in India by improving on the rapid delivery of the goods. 

But what about catalog? Keep in mind that Jio is currently planning for delivery of groceries. Reliance stores can supply these. If something is not available, Reliance will already know who is the nearest shop-keeper who has it in stock. 

This will happen automatically and reliance could make use of machine learning and artificial intelligence to optimize on the delivery. Since Reliance is in control of their commissions; the delivery fees can be adjusted from the profits. Retailers to keep a lot of margin. 

The shopkeepers can benefit by handling the volumes. Or they could still sell the products at the MRP; while Reliance takes care of the delivery charges. 

It will take Amazon and Flipkart years and lot of investment to compete with Reliance in this category. This means the time has come to buy Reliance shares!!

Anoop Mathew
Anoop Mathew · Jan 1, 2020
Rank A3 - PRO

1. Reliance has been onboarding Merchants into their system with their PoS (Point of Sales);system. This gives the opportunity to not just Reliance's own stores but the multitude of shop owners without an exclusive online presence to showcase their products. Reliance stores would be selling FMCG (Fast Moving Consumer Goods), Electronics, Clothing, etc, but introduction of these 'Kirana stores' into their ecosystem would in turn help boost the need for the public to actually maybe use the JioMart app as a one stop solution for all their needs. 

2. Combine Point 1 with the already established Reliance Jio network infrastructure and upcoming 5G plans they've in works, it has a greater potential than Amazon or Flipkart in the Indian Market.

3. Looking at Points 1 & 2, one can envisage the opportunity in front as a marriage between Flipkart/Amazon and Big Basket. Add a few perks such as free movie voucher or recharge vouchers and you would have the masses attention.

4. The challenge for Reliance would be to maintain that right balance where people use both their App as well as their Brick and Mortar store evenly so that both businesses do not challenge each other's growth.

5. While thinking of point 4, i am wondering how many of us actually buy clothes/electronics online or still prefer buying from a physical store. For me personally, I would:-

a. Buy a bunch of t-shirts online only if the price is cheap (~Rs.600) and subject to having seen enough good reviews. If i were to go for an expensive formal shirt (upwards of Rs.1500) or an Adidas Sneaker (Rs. 8000) or an Adidas Jacket (Rs. 5000) i would prefer going to an authentic store and spending those huge amounts.

b. Buy cheaper or 'out-of-necessity' electronics (like headphones, or mouse or a portable keyboard, etc) from online sources and would rather go to a Chroma or Reliance Digital to get an expensive Phone or TV or Digital Camera. The buyer is always worried about the 'transit' part of the deal. If you notice, you would have all gone and checked out a fridge from a Reliance store and then asked them to Home Deliver it. There's a peace of mind to doing it that way because you were physically involved in the transaction and you actually interacted with a human while it was getting delivered. If Reliance can deliver that level of 'ease' without me having to ever visit the Reliance store, it's good for me. But is it good for Reliance if everyone decides to just buy fridges from an online app? 

Another side of this argument (self arguing here 😟) is that my roomate just bought us a new Vu TV from Amazon 2 months back. The package got delivered within 24 hours, and it was clearly instructed not to open the package unless with the Vu Certified Technician. So we waited for the Technician to arrive, and he was kind enough to come over in couple of hours. The package was unboxed in front of him, and he set up the TV including getting the wall mount brackets drilled to the wall. So, if all these steps are covered in just one click of a button where the item, the app, the delivery and even the service guy are all from the same company, then that's the best experience possible!

P.S.: Call it my age maybe, but i still can't digest buying expensive clothes or shoes from online. Maybe it's because of the bad experiences I've had. I am however more sure of buying electronics now than earlier 😆.

P.P.S.: But seriously, clothes, 🙄 how does one decide on the expensive ones? 🤔 Is it just me or does anyone else think the same way?

Anoop Mathew
Anoop Mathew · Jan 1, 2020
Rank A3 - PRO

P.P.P.S.: Adding to Groceries, I wonder what 'new' idea Reliance would come up with to tap the 'untapped' housewives of Indian Metros/Suburbs who're used to bargaining for 'cheaper' vegetables on a daily basis and have not used Big Basket yet? 

Will that market never get 'tamed'?😟 

Jai Patel
Jai Patel · Jan 2, 2020
Rank C3 - EXPERT

Looking at the way Reliance perform with proactive strategies, there seems to be optimistic and realistic probable to beat amazon and walmart in India.

Reliance company is a risk taker and a market penetrator. It jumps into a business with complete research and hits the market hard even after suffering losses, at the introduction stage of a business to gain attention of the people and win their confident. It has succeeded in doing so many times in the part, one of the best example is Jio telecom.

Amazon and walmart has one of the strongest support of being a well known and well established company in their country of origin where they are receiving dollars which is a stronger currency than rupee. These companies can suffer huge losses in Indian markets and can set off it against profits earned in dollars in their market in the country of origin. This can be the only challenge for an attacking company like Reliance for Jiomarts.

Let's wait and watch, we are consumers, we shall be benefited from either of the one due to their pricing war.   

Kaustubh Katdare
Kaustubh Katdare · Jan 2, 2020
Rank A1 - PRO

Just dropping in to say I've never been so impressed with the quality of answers; especially by Anoop Mathew. Very good points discussed! Good points raised by Jai Patel and Mohit Patil too. 

It's no wonder that Ambani wants to establish monopoly in the markets. Ambani ran after the broadband and data that India consumes and now owns a fair share of it. Second, As Anoop Mathew said - 

"Looking at Points 1 & 2, one can envisage the opportunity in front as a marriage between Flipkart/Amazon and Big Basket."

Perhaps, Ambani wants to establish a monopoly in the segments we do not see. The POS business is already being set up and Jio already has "Jio Money" to take care of digital payments. 

Ambani is also going after the likes of "OKCredit" and "Khatabook" - the apps that recently saw lot of traction in Indian markets. Reliance could offer a digital accounting solution coupled with digital payments - and all our local store owners are going to be happy. 

Consider Amazon and Flipkart. How would you beat them? I think Ambani knows that Indian consumer is typically not loyal to brand; but is highly influenced by discounts. Jio Mart will begin by offering discounts and consumers like me will flock to them. Then express delivery will make me happier and want to make my next purchase with Jio Mart instead of Flipkart or Amazon. 

Consider BigBasket - the way to beat them would be in 'Prices' and Delivery. BigBasket delivers within 24 hours and you've to decide the slots; but they haven't been able to succeed in the pricing game. 

I'm pretty much convinced that Jio Mart is a going to be one of the top 2 players in Indian ecommerce markets by end of 2020. 

Anoop Kumar
Anoop Kumar · Jan 2, 2020
Rank C2 - EXPERT

I would step back in starting of last decade where Flipkart was huge and Amazon just go entry into Indian market. Everyone I discussed and me also, thought it will take number of years.

However, within two years, launched in 2013, Amazon pushed Flipkart from number one. The massive monetary supported of Amazon to take hits initial days and build genuine customers.  

One think in any market/business is common

Customer is King, take care of them.
Build Trust: Build genuine customers with genuine product, not necessary loyal but genuine who buy/user service again and again. 

look at both Amazon/Uber/Myntra model. They mostly give you genuine product. If customer have issue, they will get the return "No question asked".

PayTM has biggest opportunity to capture online market but their greedy nature never worked for online shopping. 

JioMart want to take over market, they need to take care of it. I see new online portal every day popping up. They also list down good product. But there is no review/question system. Amazon has really nailed to build customer forum kind of thing at product page.

Do we buy online cloths: Yes, we do. Myntra success story in building the trust is interesting. They always give genuine product, as far I have seen in last 6 years. 

Do I prefer online wearable shopping? No, but when I have option to return. I would not hesitate when I can't find it in local.
Biggest product I got is, Leather jacket in 2015, at 13k. I had no option because, I couldn't get such quality jacket from local market, Even in Hyderabad.
I still never saw such quality jacket in any store. This experience build trust. Bought number of items in my family. If, its, well known company, product was always genuine. But, I still prefer to check local market. They are are usually cheaper.

Online Grocery: 

Vegetable: As someone me who have been part of cultivating all vegetables.
Big nope. Even not preferable from super market. They are highly washed/chemicals to look good. They have very little value. I always prefer from local Vegetable market weekly.
I would never suggest anyone to buy veggies online. Find nearby veggie market, 10km in radius, and go weekly. Lot of people buy online/super market because, they never bought fresh veggie from local market.
Kitchen Items: As it is dry items. I buy online when there is offers. No harm in it. Still, the local vendors give better quality.

Online shopping portal does get hit by fraud users who buy just for fun to return. But these are very less in number vs real customers.

PS: I know, the veggies available in cities are not as nutritious as it should be. But still but vegetable market give you much better quality and taste that super market or BigBasket. They are usually cheaper.

saandeep sreerambatla
saandeep sreerambatla · Jan 2, 2020
Rank B3 - LEADER

I buy everything online, I love doing it that way because its convenient. Initially I started buying books on flipkart and also other items but when Amazon came into picture I switched completely to Amazon. Why the customer service of amazon is far better than that of flipkarts.

Next coming to the question of Jio-mart, first lets talk about jio, with the excellent plans and speeds initially many people moved to jio and I still think many people's second number is jio not primary number. (correct me). 

Coming to jio-mart, they have to tie up with someone , for example my organisation is tied up with flipkart and if an employee completes 7 years they provide voucher worth 7K (flipkart voucher). I think reliance should start tying up and have vouchers made available like gift cards.

If I find better quality or equal quality like amazon with less price I will go for jio-mart. (No brand loyalty) but coming back to veggies, I bought them couple of times from bigbasket and they are of really bad quality. I will go every friday to market which is 300 meters from my home and buy required veggies for a week.

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