The Indian consumer technology sector is going to change its model to suit the market needs.
Many people these days use online shopping sites to browse for a device, do a bit of research and compare its pricing with the offline store. But since the lockdown and in the post-COVID-19 universe, people are largely to use delivery services (ie e-commerce) to make purchases. Which is likely to deter offline players from running their business. But this month, we've seen a new change coming about in India consumer electronics sector, as many brands are looking to marry the convenience of online with the easy availability measures of the offline retail ecosystem.
This model is commonly known as the online to offline (O2O), and we're going to see most of the mobile and probably laptop brands preferring to use this to scale their operations and sales, without incurring higher investment.
The likes of Vivo, Xiaomi and Samsung are the first ones to announce their strategy to adopt the O2O model, which more or less sounds like a win-win for companies as well as the offline mobile shops. For the consumers, they get to choose from a wide array of products, without having to bargain on the price and get it delivered from the nearest mobile shop in their area. This can be done by contacting the store via WhatsApp or any related mobile app. This kind of hyperlocal delivery model can be an effective tool for the company since they don't have to incur costs on warehousing the products.
Delivery of products means the consumer doesn't have to step out of their home, and the seller can easily work along with third-party delivery providers to make the service viable for them. Mobiles are easily managed these days and tapping into the existing business shops help them scale the process without any glitches. For instance, Vivo claims to be using over 20,000 retailers for its O2O program, and others will be using their retail network to make this a successful sales channel.
The lockdown has definitely caused logistics concerns for companies and sellers, and most of you have relied on the local grocers to get their daily essentials. The O2O model is going to be an active part of India's retail ecosystem in the coming months, and biggies like Amazon with its Local Shops, and Reliance with JioMart are raising the stakes for this model to be adopted by more enterprises.
Now it remains to be seen if consumers buy into this idea and whether the pricing of a product doesn't get diluted by the seller.
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