Rural 'next big focus' for ShopClues

A file photo of ShopClues CEO & Co-founder Sanjay Sethi (left) and Co-founder & Chief Business Officer Radhika Aggarwal

Having already crossed 500,000 merchants, second to only Alibaba, 80 per cent of which are from tier-2 and -3 cities, ShopClues is now looking at tapping the rural B2B market.

Through its partnership with StoreKing and Payworld, the e-commerce player is targeting to reach 300,000 offline, high-traffic small stores in rural India over the next 18 months.

"Rural is our next big focus area, which is more of a B2B initiative that we kicked off recently with our partnership with StoreKing, an assisted e-commerce player with a strong rural focus. With StoreKing, we will have access to deep rural pockets in south India with low internet penetration, such as Kollam in Kerala, Theni and Nagapattinam in Tamil Nadu and Tumkur in Karnataka, where we will work with kirana stores, mobile recharge points and small shop owners," Radhika Aggarwal, CBO and co-founder, ShopClues told Business Standard.

Plans are afoot to work with the small shops in rural areas to help walk-in customers shop on ShopClues. To further deepen its rural penetration, ShopClues has also tied up with Payworld in the assisted e-commerce category.

Already, the e-commerce player has witnessed a steady traction from tier-2 and -3 cities. According to Aggarwal, apart from over 80 per cent merchants from smaller towns, over 70 per cent orders on Shopclues comes from tier 2 and 3 cities.

Category-wise, the highest demand from smaller towns at ShopClues has been for home & kitchen, lifestyle (clothing, shoes and accessories), and mobile & electronic accessories.

"Home & kitchen category has been the flagship category of Shopclues. Strong growth in demand from tier 2 and tier 3 cities, value-based selection and lowest prices have been the key reasons for propelling the exponential growth in the category at Shopclues. While other players have just focused on branded selection in the utility segment, ShopClues was quick to understand the consumer psyche in this segment and has been leveraging the strong demand for selection from regional & private labels," Aggarwal said.

On the portal, the e-commerce player has found a high propensity among consumers to buy a better priced private label if matched with their need and quality. Add to that, availability of lowest priced products starting at as low as Rs 18 has also been pushing demand from smaller towns.

Currently, more than 3.5 million orders are shipped every month from among a range of around 50 million products to choose from on ShopClues.

Going forward, even as it plans to clock a gross merchandise value (GMV) of $ 3 billion (roughly Rs 20,000 crore) by the close of financial year 2017-18, ShopClues is banking on the rise in merchants on its platforms. For instance, by end of this year, ShopClues is looking at increasing the 500,000-odd merchants to one million.

To consolidate its rural focus, ShopClues is also looking at helping merchants digitise their businesses.

"Shopclues has always maintain its individuality with its unique initiatives and clear focus on masses. About 90 per cent of these merchants do not even have a point of sale system so we are trying to digitise the business of these SME merchants. Our purpose is to make them digitally savvy by introducing them to marketing and cataloguing services, auto management, merchant mobile banking," Aggarwal added.

Going rural:

* To increase merchant base from 500,000 to 1 million

* Partners with StoreKing, Payworld to access deep rural pockets with low Internet penetration

* Helps digitise merchants by introducing them to mobile merchant banking, auto management

* Builds on successful categories like home & kitchen, lifestyle that see higher traction from small towns

* Leverages demand for regional and private labels


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