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Move Over Amazon, Flipkart; There’s A New (Ecommerce) Model In Town

Move Over Amazon, Flipkart; There’s A New (Ecommerce) Model In Town

As the ecommerce majors squabble between each other and the government, social commerce is quietly spreading into India’s teeming mid-tier cities and towns

Those who think that ecommerce in India is now a high-stake two-horse race between Amazon and Flipkart may have missed a new player coming up fast from the shadows. A recent clutch of investments from some of India’s wiliest venture capital firms such as Sequoia, Accel, Matrix and Kalaari have shown that social commerce, a concept that meshes social media and ecommerce, is already changing the way people shop.

If you live in one of India’s five metros, you may not even have heard of names like GlowRoad, Meesho, Shop101, BulBul, DealShare and Mall91. But these are names that are bywords for online shopping in India’s 50-plus mid-tier cities and almost 5000 towns. Not only have they become popular channels for shopping the latest clothes, electronics, accessories and household products, but also as an opportunity to earn money.

Social commerce focuses solely on middle-income and lower-income segments from non-metropolitan cities in India to sell non-branded apparel, groceries and local handicrafts. The social part of these platforms comes from the fact that users can get better deals or earn money by rounding up their friends and family to make purchases through them. Driven by Facebook posts and WhatsApp messages, social commerce companies rely on the oldest form of advertising: word of mouth. Simply put, a person is more likely to buy something if it is recommended by somebody they know and trust.

While Western models of social commerce are slightly different and mostly involve integrating ecommerce features into an existing social network — ‘Buy’ button to Twitter, Facebook or Pinterest— in the Indian context, social commerce is not just a purchase or a transaction, but an extension of the actual social networks that govern online interaction and activities.