We latched on to a concept of trust, says Sridhar Gundaiah of Storeking
What has changed in the last four-five years is smart phones and DTH. People are getting to know about new products and services using television and communication. Now they are getting used to ordering online without having to touch and feel, maintains Sridhar.
StoreKing is one of India's largest rural e-commerce companies with revenues of Rs 1,200 crore in FY 18. Larger e-commerce marketplaces such as Amazon piggyback on this company to reach rural markets, where both demand generation and delivery is an uphill task. Sridhar Gundaiah, Co-Founder and CEO, Storeking, recently spoke to Business Today's Goutam Das on the growing Bharat market for e-tailers.
What is driving e-commerce in rural India?
What has changed in the last four-five years is smart phones and DTH. People are getting to know about new products and services using television and communication. Now they are getting used to ordering online without having to touch and feel. They wouldn't have done this a while back. Because of DTH, they know when a new product is launched. The other aspect driving rural commerce is the transition from joint to nuclear families - every single house is replicating everything they need multiple number of times, the refrigerators, fans, televisions.
There are different definitions of what constitutes a 'rural e-commerce' firm. Would you say you are an 'assisted e-commerce' company?
We are a technology-enabled distribution platform. We don't call ourself assisted e-commerce. For us, the retailer is the bridge. The consumer walks into a retail store but he could only purchase what was currently available. We empowered the retailers with tablet and kiosks. We latched on to a concept of trust. In a small village, every single retailer knows you by name. He knows when a new child will be born, your birthday. The personalisation factor is deeply knitted.
What models of payments are working?
From 2012 till date, we are 100 per cent pre-paid. Consumers pay the full money to the retailer. While others (larger e-commerce platforms) say they disrupted cash on delivery, COD doesn't work here. Its a prepaid model here. Walk in to a kirana and buy mobile phone. You pay and wait for the delivery. The kirana is the trustworthy guy. Once the customer pays, the retailer collects the money. He maintains a float with StoreKing, which is debited. We ship the product to the retailer. We handle logistics, payments, and order management.
Big data crunching is changing how we shop online and what pops up when we open an e-commerce app. Has data started playing a role while selling to Bharat?
We have a lot of analytics. We can predict what products a kirana should stock. Kiranas only used to stock what they feel is necessary, not what the consumer needs. They didn't have the data. Now, we give the retailer an opportunity to sell every single variety of a shampoo, which you don't have to stock.
Also read: E-commerce Goes Rural