Presently in India, the buzz is about e-retailers such as Flipkart, Amazon.in, Snapdeal, Jabong, Infibeam and many more backed by funders who believe the sure shot route to making more money in the future is by making more losses right now. A few years back there was a similar buzz about airlines in the country. A ticket to Goa was cheaper than taxi fare to the airport.
Most airlines, except Indigo that sells sandwiches at 500% profit mid air, continue to make massive losses. Kingfisher has gone bust. The e-retail mantra is simple, followed by a host of others who have not survived in business — sell cheap, whatever may be the cost, even if the seller goes bust and sinks in a heap of too many goods sold at a discount.
Ultimately, profits will be made as others hopefully will sink earlier. Try to peddle the concept to an Indian housewife, for centuries the most efficient and thrifty global money managers, without splurging on a MBA degree. She will tell you to take an early morning walk in the park to clear your head.
Or assume you have watched Hrithik Roshan’s Bang Bang to momentarily lose your mental bearings after watching such gibberish. The Indian housewife deserves respect — remember she has never gone bust like Lehman Brothers or Vijay Mallya. Until most e-retailers collapse, merge, are acquired or in the very unlikely event of the Indian housewife model of money management being proved wrong, the consumers are having a ball.
Acche Din has already arrived for online buyers, without being promised by the Modi government that is trying hard to deliver similar utopia for the rest of India by creating smart cities with the help of people such as Mark Zukerberg. I Like that.
The list of essentials I buy online has grown manifold over time – from clothes, CD’s, books, shoes to TV, printer, computer, furniture, mobile phone and more. Apart from the money saved, several hassles of usual urban Indian living are conveniently avoided – pollution, road rage, potholed roads, no parking space, traffic jams, fuel costs, among other encumbrances.
I have to drop my kids to school though. No way to e-scape that process. Given the current e-brouhaha, including the Flipkart Big Billon Day sale that crashed before it could be launched resulting in an apology from the bright promoters that sounded like another marketing gimmick, my current state can be described as couch potato cum online purchaser. I watch TV as I e-shop, just as I watch NDTV news on the tread mill, Whatsapp while I work and SMS as I drive.
The future generation is doing better or worse, depending on the way you look at it. My elder daughter, chats, Whatsapps, FB’s, SMS’s and watches Youtube videos while doing her Math homework. Her mom is obviously hysterically paranoid by the developments. No doubt, e-retail is spreading and percolating. The other day our maid told me to order a new cell phone online for her, selling a thousand bucks cheaper than the local market rate.
Adept at using her mobile phone, she is saving up to buy a computer so she can shop on her own, plus listen to music and watch movies. TV serials are passé. Everybody wants to join the e-party except offline retailers, a very powerful and influential group, who are predictably very upset due to loss of business. They have earned their unhappiness the hard way.
After winning a long and bitter battle to prevent international multi-brand majors such as Walmart and Tesco setting up shop in India, the e-retail Tsunami threatens to sweep them away. I believe some of them have complained to Prime Minister Narendra Modi that his “Swachh Bharat” campaign will quickly turn murky if they are not saved from the e-carnage.
“What is the use of cleaning our shops when nobody is going to be visiting us,” some have Tweeted and e-mailed to the PM. Modi, as the country knows by now, reads mails and Tweets in the morning, unlike earlier PM’s like Nehru who read newspapers. I have heard that Manmohan Singh read the papers till late afternoon as there was nothing else to do.
The Indian Kirana store owners are smart though, which is expected. There is no bigger MBA lesson than negotiating with hard-bargaining to the last lemon or onion housewife. The mom & pop store keepers have been quick to sense the price arbitrage opportunity.
Many, I believe are ordering online to stock up their stores. Nobody doubts that the e-commerce boom is here to stay. Competition will weed the right business model I am sure. In the meantime, while shopping and watching TV I have been contemplating an e-start up. First up, I need to find a garage, preferably online. Then, I will hire a housewife. That way, I will never go bust.
(Check out my novel An Offbeat Story)