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Flipkart takes cue from Reliance to push offline strategy

The online marketplace has tied up with around 800 small shopkeepers in Telangana to sell mobile phones through the Flipkart app

May 3, 2019 by The Passage Team
Flipkart takes cue from Reliance to push offline strategy

Flipkart is taking a leaf out of Reliance Retail’s playbook to onboard kirana stores to push its omni-channel strategy.

Initially, Flipkart will partner with 15,000 small convenience stores, beauty salons, bakeries and pharmacies etc to sell smartphones. Later, the company will push other products through these stores that would also double up as last-mile delivery agents.

As part of beta run, the online marketplace has tied up with around 800 small shopkeepers in Telangana to sell mobile phones through the Flipkart app. The shops take care of the last mile connectivity, two people in the know told Gadgetsnow.

“The shops use a separate affiliate link in the Flipkart app to conduct business,” a source told Gadgetsnow.

More than 95% of retailing in India happens through physical stores. The battle lines are drawn as Reliance is all set to enter the e-commerce space. Earlier, RIL chairman Mukesh Ambani said the company will create a hybrid online-to-offline commerce platform by integrating and synergising Reliance Retail’s physical marketplace with telecom unit Reliance Jio Infocomm Ltd’s digital infrastructure and services.

Flipkart’s pilot project in Telangana is generating Rs 15-20 crore of monthly revenues, and the company now wants to replicate the model nationwide, said the person quoted above.

Flipkart’s fashion arm Myntra had partnered with around 9,000 physical stores in 50 cities for deliveries under its ‘Mensa Network’ programme launched in 2017.

Earlier, Amazon India had launched the I Have Space programme to collaborate with local storeowners and add extra earnings to their regular income while also increase footfalls to their local shops. I Have Space is hooked up with 20,000 mom-and-pop stores across 350 cities for last-mile deliveries.

Amazon has plans to set up 100 kiosks in India by the end of the year. However, unlike Flipkart, Amazon doesn’t accept orders through these stores.

Meawhile, RIL plans to add local merchants to its platform, boosting their sales through O2O (online-to-offline) marketplace. "Reliance is working on creating the world's largest online-to-offline New Commerce Platform," Ambani said at the "Make in Odisha Conclave" in November last year.

has around Reliance Retail has around 10,000 outlets across India.

“We think Reliance Retail is most suited for an e-commerce play. They have the capital strength, a big offline presence, good brands in their kitty and significant grocery operation. If not this Diwali, we expect a launch of the e-commerce venture next year for sure," Satish Meena, senior forecast analyst at Forrester Research told Livemint. “Though it may challenge the position of existing e-commerce majors, it will also attract new online buyers, which will be good for the segment."

The Passage Team

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