The country’s largest electronics
India has effected a comprehensive plan, activating physical stores in integration with online and digital platforms, to resume business in all zones.
In a tie-up with digital marketing solutions firm Benow, the new scheme — internally called O2O — will ensure seamless integration of digital and online platforms with physical outlets in any region. Unlike the usual omnichannel strategy, where consumers used to access the online sales network for any product at physical stores, the new O2O scheme generates leads from online and serves them through offline stores.
While Benow will identify demand from willing buyers through artificial intelligence tools on digital and social media platforms, any local store that registers on the network will be able to serve consumers, depending on their locations. The plan is to turn the outlet into mini-warehouses, so that even if they are not allowed to open, they can survive by registering sales, while consumers - even in red zones - get served.
“This is part of our broader online-to-offline (O2O) strategy and is aimed at providing benefits of both offline and online platforms to the consumer. This will ensure our consumers do not have to step out to a physical store at a time when social distancing is the new normal. At the same time, the new platform enables thousands of physical retailers to connect with local customers online,” said Mohandeep Singh, senior vice-president (V-P), Samsung
India, that replaced Samsung from the top spot in the smartphone market a few years ago, has come up with a similar hyperlocal retail plan — Mi Commerce.
To generate leads, Xiaomi
has dedicated a business number on WhatsApp, apart from its mobile application, through which consumers can place their orders, which will be delivered by their nearest retailer. It plans to introduce a WhatsApp bot that will guide consumers through intuitive features like locating a nearby store, while individual retailers will be able to promote their sites to reel in consumers. “This is a future-ready experience enabling our users and retail partners in a post-Covid world. We hope the solution would be a game-changer in enabling offline retail business to grow,” said Muralikrishnan B, chief operating officer, Xiaomi
India. The changing tack is in contrast to Xiaomi’s tried-and-tested online-only formula that helped it gain share in the early days.
According to Manu Kumar Jain, V-P, Xiaomi, it is also ensuring credit facilities to its retailers through the in-house Mi Credit business. Like its rivals, executives at Vivo India are burning midnight oil to operationalise its Vivo Smart Retail Solution programme that it hopes will revive the faltering offline trade.
The firm has initiated an integrated lead management system that includes activating tools on social and digital media to identify potential buyers and dedicated mobile numbers through which consumers can place orders or enquire about products via SMS. To ensure smooth transaction, Vivo has activated its 30,000-dealer level brand ambassadors, who will remotely assist potential consumers in finishing their purchasing process. “This is a win-win for consumers unable to purchase, and retail partners who need to kick-start their businesses. To begin with, we have activated 20,000 retailers pan-Indian under the scheme,” said Nipun Marya, director (Brand Strategy), Vivo India.
Mobile, the largest smartphone player after Samsung, is resuming business through 10,000 outlets, and has activated 17 per cent of its store consultants. However, for now its plan is restricted to orange and green zones only, where leads generated through its pages on Twitter, Facebook, and WhatsApp will be served through local stores. Appliances major LG India is wooing consumers with offers worth up to Rs 10,000, against pre-orders placed on its site.
In a tie-up with banks like ICICI, HDFC, Standard Chartered, and State Bank of India, among others, the firm is also offering cashback up to 12.5 per cent of the purchase value. Four years of extended warranty and flexi-equated monthly instalment schemes against zero down payment are on the table as well. The changing focus of leading players is not without rationale.
In the initial days, the network of over 50,000 physical retail outlets —selling mobile handsets to television sets — had been the key growth avenue for leading players like Samsung, LG, Vivo, and Oppo.
In the past three years, the online channel has grown by leaps and bounds — taking significant business away from mom-and-pop stores. The share of online channel in the smartphone market, for example, has grown to 40 per cent by end-2019, from 20 per cent in 2016, thanks to infusion of funds by their global parents in billions of dollars. However, with red zones excluded from e-commerce delivery of non-essential items, all electronics firms are in a quandary. Industry estimates suggest over 75 per cent of total sales comes from areas marked red.
Manufacturers have already lost over 65 per cent of the Rs 23,000-crore sales from durables that happen in March and April. For mobile makers, March accounts for Rs 10,300 crore, while Rs 10,500-crore sales take place in April alone.
“The partial relaxation of lockdown brings little relief to us - 80 per cent of our sales comes from the metro markets, which are still closed,” said an executive from an electronics major.