The evolution of Mobile and Internet has transformed the consumer behaviour around the world. E-Commerce made it easy and convenient for people to browse catalogue, compare products and bag eye-popping discounts from the confines of one’s home with the power of touch.
E-Commerce growth resulted in innovations in logistics technology and infrastructure. Innovation in logistics resulted in a new breed of smartphone based, hyper-local ventures which brought local retailers on board to service consumers in quick time.
They deliver everything from groceries to mobile phones to medicines in a few hours sourced directly from the supermarket next to your home. Today, E-commerce giants are finding themselves increasingly vulnerable to the on-demand businesses built on the back of hyper-local logistics technology, a mobile-first consumer experience and local retailer partnership.
Logistics driven hyper local businesses whether in B2B space or B2C is controlled by three factors?—?unit economics of hyper local fulfillments at scale, total supply from network of retailer partnerships and local demand.
You bet it will become increasingly tricky and “power of execution” will become the key differentiator when players will have to do these things at scale. This is one of the major reason that we see a vertical fragmentation in this space to reduce the operational complexity and lower the entropy.
Even though industry is observing exponential growth both in E-Commerce and On Demand businesses but neither of them capture the long tail because their supply is limited to the seller/retailer partnerships, after all these are managed marketplaces. We need to go beyond managed online marketplaces to completely distributed marketplaces.
Distributed Marketplaces that empowers 13 million small and medium retailers in India and matches local demand with supply. These local retailers use the distributed marketplaces to do active commerce via mobile and internet and convert 520 million daily customers to shop locally.
This not only lowers the barrier to entry to creating wealth but also results in an optimal producer-consumer equilibrium that can have ripple effect across the whole economy as local consumers spend billions of rupees digitally and locally.
The future of e-commerce, in India, is mobile commerce that matches the local demand with supply and establish strong network effects by empowering local retailers.
[box type=”shadow” ]About the Author: Ram Singla is Founder & CTO PayMango.com, a local m-commerce marketplace and is on a mission to empower local businesses[/box]