When it comes to the Indian business environment, one simply can't ignore Mr. Mukesh Ambani, the biggest player, the owner of Reliance Industries, and the wealthiest businessman of India. He has footprints in some of the most important sectors of the Indian economy like refining, oil & gas, petrochemicals, telecom, retail, and media. The biggest accomplishment, to date, has been Reliance's oil refining business.
In September 2016, Mukesh Ambani officially launched his telecommunication venture called Jio (Joint Implementation Opportunities) and set an example by turning Jio into the largest mobile network in India and the third-largest mobile network operator in the world with over 322.99 million subscribers (source: Wikipedia).
Witnessing the growth in revenues, profits, and market share in the above-mentioned sectors, Mukesh Ambani is now all set to try his hand at e-commerce through his new venture called JioMart. Let's have a look at Jio Mart concept and what is it all about.
JioMart - Company Highlights
| Platform Name | JioMart |
|---|---|
| Sector | Online Grocery, Ecommerce |
| Founder | Mukesh Ambani |
| Founded | May 2020 |
| Parent Organization | Reliance Retail Limited |
| Website | jiomart.com |
What is JioMart and How Does it Works
Features of JioMart
The Idea Behind Starting JioMart
JioMart - Business Model and Revenue Model
How to Become a Seller on JioMart
How JioMart Consumers and Retailers will Benefit from the Jio-Facebook Deal
A Peril Approaching Grofers, Amazon Now, Big Basket
Conclusion
JioMart - FAQs
Also read: Companies which Invested ₹ 67,194.75 Crore in Jio Platforms
What is JioMart and How Does It Works
JioMart is an online grocery store that aims to provide 50,000+ grocery products, at competitive discounts and express delivery at your doorstep. It follow an on-demand model. The company will avoid the system of warehousing and will partner with local retailers who will source the grocery products and they will deliver it to the customers.
JioMart began functioning in January 2020 and is currently operational in Navi Mumbai, Thane, and Kalyan. The company is expected to be launched soon in other parts India. However, its exact launch date is not known yet.
The JioMart App will soon be available for download on Google Play Store and on Apple Store.
Features of JioMart
JioMart will operate on the Online to Offline business model, which means it will connect with local retailers and deliver goods to customers by procuring them from the nearest store located in the customer’s vicinity. This model is unlike the warehouse model used by Grofers and Amazon Now.
The company aims at correcting the unorganized retail sector, benefiting local shopkeepers whose businesses were being adversely affected due to competitive pricing and warehousing strategies of other online retail stores. In addition to increased sales and margins, these shopkeepers will be equipped with points of sale (PoS) terminals, integrated billing applications, GST compliance, thereby easing taxation and also upskilling them in inventory management and supply chain management.
This way, RIL will establish its new venture, termed as "Desh Ki Nayi Dukaan".
JioMart claims to offer consumer-friendly services like:
- Free home delivery: It will give you the benefit of delivery of commodities at your doorstep by procuring it from the nearby store, and that too free of cost, which your Kirana wala bhaiya might not.
- No minimum value: Generally, e-commerce sites set up a minimum value of a purchase to validate free delivery. For example, Grofers has the policy of free delivery on a minimum purchase of Rs 500. It will not expect any minimum payment and will not take delivery charges, even for the smallest of items ordered.
- Express Delivery: Express delivery means quicker delivery than ordinary services. In the e-commerce segment, it is generally within 24 hours.
- No questions asked return policy: When you wish to return goods ordered online, you are almost always bombarded with unnecessary questions that you may not wish to answer but cannot avoid. JioMart will save you this hassle.
- Early bird discount of Rs 3,000: The platform has come up with a promotional strategy of pre-registration wherein people can save up to Rs 3000 on future shopping. Jio has started sending invites to its existing telecom service users in selected areas.
Relevant read: Reliance's Online Grocery Service JioMart Expands services in 200 Cities
The Idea Behind Starting JioMart
JioMart wasn’t an overnight expedition of Mukesh Ambani but a well-assessed move with the sole motive of capturing the highly sought-after e-commerce segment which is projected to grow up to $1.2 Trillion by 2021.
He already has a good customer base in the retail sector with Reliance Fresh which functions successfully on the brick-and-mortar model. JioMart owner Mukesh Ambani's plan to set up an e-commerce platform started way back in 2019. His ambitious project emulates his desire to compete with global e-commerce giants such as Amazon and Walmart-owned Flipkart.
- Acquisition of Grab A Grub: Grab A Grub is an Indian logistics startup founded in 2013. In March 2019, Reliance Industrial Investments and Holdings Limited (RIIHL) acquired it for $14.9 million to support the logistics of Jio Mart founder Mukesh Ambani’s “planned e-commerce venture”. Grab was chosen as it worked efficiently with some mega-brands such as McDonald's, BigBasket, Myntra, Amazon Now, Swiggy, etc.
- Acquisition of C-Square: C-Square Info Solutions Private Limited, founded in 2002, provides software solutions for various functions like e-commerce, salesforce, retail, etc. It was acquired by RIIHL in March, 2019 for an amount of $11.56 million. A strategic move by RIL, it was aimed to strengthen JioMart.
Also read: Facebook-Jio deal to Turn WhatsApp into Super App like WeChat in China
JioMart Business Model and Revenue Model
Through JioMart, RIL is offering local merchants offering an O2O (online-to-offline) marketplace. This business model pioneered by the Chinese e-commerce giant Alibaba Group Holding Ltd. Under the O2O model, a consumer searches for the product or services online but buys it through an offline channel.
It connects with local retailers and deliver goods to the customers by procuring them from the nearest store located in the customer’s locality. In this case, customer will use official WhatsApp number to place order. After confirmation, user will receive the bill which is to be paid in cash. When store is ready with the order, customer will receive the notification to pickup the order from store.
How to Become a Seller on JioMart
A retailer can register with JioMart to become a seller. Post JioMart registration, retailers will receive the required support for smooth delivery of goods to customers.
Registered grocery store owners will be able to list their inventories, take orders, create offers, and manage online sales using the app. The company will ensure that the sellers associated with its platform gets a smooth selling experience.
How JioMart Consumers and Retailers will Benefit from the Jio-Facebook Deal
The Jio-Facebook deal, wherein Facebook will invest Rs 43,574 crore ($5.7 billion) in Jio platforms, will make lives easier for consumers and retailers associated with JioMart. As part of this deal, Whatsapp—Facebook’s popular messaging platform —will collaborate. Owing to this collaboration, JioMart users will be able to place their order through Whatsapp and Facebook while payments can be made using ‘Whatsapp Pay’ feature (currently in pilot), and will soon be available for Indian Whatsapp users.
JioMart services have been made available on Whatsapp from 25th April 2020 in Navi Mumbai, Thane and Kalyan, where it is currently operating. However, the only mode of payment currently available is cash.
Also Read: Reliance JioMart goes Live on Whatsapp and starts Operations in Mumbai Suburbs
Commenting on the deal, Jio Mart CEO Mukesh Ambani said “In the very near future, JioMart - Jio's digital new commerce platform, and Whatsapp - will empower nearly 3 crore small Indian Kirana shops to digitally transact with every customer in their neighbourhood”
A Peril Approaching Grofers, Amazon Now, and Big Basket
According to a report, grocery delivery startups such as Grofers, Big Basket and PepperTap have performed extremely well with enormous funding and exponential revenues in the past couple of years. Realizing the potential, some well-established e-commerce platforms like Paytm and Amazon also began delivering groceries and essentials.
With the entry of the biggest player in the Indian market, a serious threat looms over existing grocery delivery ventures. Besides being a popular brand name, JioMart has some features which will give it an upper hand over competitors.
Also read: Facebook Invests $5.7 billion in Jio Platforms for 9.99% Stake
Conclusion
When Jio entered the telecom segment, it stirred a revolution and turned the tables on the biggest players who dominated for years. We're likely to witness a revolution again because of Reliance's JioMart. What are your thoughts on this?
JioMart - FAQs
What is JioMart's business model?
Through JioMart, RIL is offering local merchants offering an O2O (online-to-offline) marketplace. Under the O2O business model, a consumer searches for the product or services online but buys it through an offline channel.
Who is JioMart CEO?
JioMart is launched by India's richest man Mukesh Ambani. Damodar Mall is the chief executive officer of Reliance Retail’s grocery business.
Where is this service available?
To check the availability of JioMart in your area, enter your pin code at the time of ordering.
Is there a JioMart app?
Unfortunately, this service is yet to be made available on smartphones. Hence, you cannot shop using your handset. It will require you to access it through a desktop.
Link : https://startuptalky.com/jiomart-case-study/
Author :- Lakshya Singh
June 23, 2020 at 08:40AM
startuptalky