Reliance Retail, the next one to enter eCommerce trail

RelianceA part of Mukesh Ambani-led Reliance Industries, Reliance Retail is in plans to enter the eCommerce business soon. The company is said to be working on the project and is expected to launch the eCommerce venture in the coming six to eight months.

The company had already said during its quarterly results announcement that it will be opting for multi-channel retail.

As per reports, it might go for a marketplace model, a person close to the development said that if the marketplace model makes sense, it will go for it. “We are evaluating all possibilities,” he added.

In a marketplace model, companies don’t sell directly rather it provides a platform for other retailers to sell their products. The seller pays the company some share of revenues that have been earned from the sale of its product through the platform.

A few of the online marketplaces in India with which Reliance Retail will get in competition include Flipkart, Snapdeal, Amazon, ShopClues, eBay, Jabong etc.

Reliance Communications, which is a flagship company of Reliance in association with Martjack is already having its online commerce presence through a similar type of marketplace model i.e. specialprivileges.com, but it is specifically for Reliance customers.

It’s another ally i.e. Reliance Brands is also in process of launching eCommerce stores for all the brands that it sells in India. Steve Madden was the first one which it took online in the country.

Reliance Retail operates over 1,550 stores which include hypermarkets, digital stores, jewellery outlets and apparel stores, in around 136 cities across the country. Its turnover in 2Q FY14 stood at INR 3,456 crore, a 31% growth over the same quarter of last year.

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Iamwire Take: There are two ways through which one can strategise their entry into eCommerce, one is the retailer model and other one is the marketplace model. It is quite a surprising move from Reliance Retail, which being a retailer is opting for a marketplace model, thus getting into a competition with existing marketplaces in India like Amazon and eBay. We have already seen FutureBazaar, which took the similar model and failed.

To contact author, email at pooja.sareen@wirefootindia.com

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