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Mukesh Ambani is working with WhatsApp to remove Amazon Fresh from the market

TFI Desk by TFI Desk
1 December 2021
in Business
Amazon, Jeff Bezos, Whatsapp, Ambani, Reliance
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  • Mukesh Ambani, the richest man of Asia, is all set to take on Amazon and Walmart backed Flipkart in the e-commerce space.
  • Ambani is empowering millions of Kirana store owners of the country through his e-commerce platform, Jiomart.
  • Whatsapp, which has more than 600 million users in India, launched a digital payment service last year.

Mukesh Ambani, the richest man of Asia, is all set to take on Amazon and Walmart backed Flipkart in the e-commerce space. The e-commerce market is growing exponentially, but Mukesh Ambani is not targeting the traditional consumers who directly purchase goods from apps like Amazon and Flipkart.

Instead, Ambani is empowering millions of Kirana store owners of the country through his e-commerce platform, Jiomart. Although the consumers can also directly order through Amazon, the app primarily serves small shop owners who, so far, used to purchase goods from the salesperson. A typical Kirana store bulk purchases items from salespersons or dealers of the FMCG companies, but now they are using Whatsapp to order from Jiomart.

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The Mukesh Ambani led company had its concept very clear from day one that it does not want to sell discounted products online and run huge losses like Amazon and Flipkart. It decided to empower the Kirana store owners, to whom it offers goods at a rate 15-20 percent less than what is offered by salespeople and free delivery.

Almost one and a half years ago, during the launch of Jiomart, Mukesh Ambani said that, “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. This means all of you can order and get faster delivery of day-to-day items, from nearby local shops. At the same time small Kiranas can grow their businesses and create new employment opportunities using digital technologies.”

Today, millions of Kirana store owners directly order through the Jiomart app. The recent stories about salespeople obstructing the Jiomart van show that Mukesh Ambani led company is offering better services and providing hefty discounts, thus pushing the dealers out of business.

Whatsapp, which has more than 600 million users in India, launched a digital payment service last year. It aims to compete with UPI based digital payment platforms like PhonePe, GooglePay, and Paytm, and it will be helped by Jiomart in the game. Now the Kirana stores can order bulk purchases through Whatsapp and pay using the Whatsapp payments service.

The scale of Jiomart and Whatsapp, combined with the purchasing power of crores of Kirana shop owners, will make Jiomart a formidable and profitable entity. On one hand, it will be a profitable business unlike Amazon and Flipkart, and on the other, it will have a scale that all e-commerce players put together will not be able to match.

Mukesh Ambani has made it clear that Reliance retail is looking for aggressive expansion, and the company wants consumer business, which contributes only 20 per cent to the total revenue, to contribute as much energy and refining businesses by 2025.

Previously, the company announced that exclusive brands like Best Farms, Good Life, Masti Oye, Kaffe, Enzo, Mopz, Expelz and Home One, which are currently available only on Reliance Fresh, Reliance Smart and Reliance Market stores will be available at local stores. The company will distribute the products with the help of distributors.

The company is utilizing Jio’s rural penetration and Reliance retail’s physical infrastructure to take e-commerce to rural areas by leveraging on small retailers. Earlier, the big e-commerce players were involved in a heavy discounting game with exclusive deals from particular retailers who were backed by the platform itself. The small retailers were being pushed out of business through this unethical practice. Reliance is giving more importance to these small retailers, and they will bounce back, thanks to Mukesh Ambani’s innovative business strategy.

Read more: The transformation of Mukesh Ambani from a business builder to nation builder

There is not an iota of doubt among analysts that Ambani-led Reliance will give tough competition to existing e-commerce players as the history of its operations in other sectors suggests. The upcoming years will give us a good show on the competition in the Indian e-commerce market especially between the richest man in Asia and the richest man in the world- Jeff Bezos.

Tags: AmazonMukesh AmbaniReliancewhatsapp
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