How many online purchases have you made in the last one month and are you also shifting groceries and consumer durable purchases to the online platform? Ecommerce players are enjoying the surge in revenues but this shift has left the brick and mortar stores in a sorry state. Online and offline both have their set of advantages and disadvantages and the emergence of hyperlocal stores seeks to change the story for the brick and mortar stores. In conversation with Digital Market Asia, Neeraj Jain, Co-Founder of Zopper explains how he is delivering the best of both the worlds – online and offline.
With presence in over 20 cities and 1.5 million app downloads under its belt, Zopper is focussed at combining the benefits for online and offline buying for the consumer. “From the consumer side, we offer the convenience of home delivery like online players do and we also provide them instant gratification and after sales services, which are the key benefits offered by a offline seller, “ explained Mr Jain. “The whole idea behind hyperlocal start-ups is to provide better value preposition to both the consumer and as well as the merchant,” he added.
Hyperlocal stores lack the features of a typical ecommerce platform because hyperlocal start-ups are forced to create demand and supply for a product in each locality as it connects buyers and sellers in close geographical proximity.
However, the close proximity help these hyperlocal start-ups too. “The merchant does not have to build complex logistics capability or ship product across regions. The working capital needs are also minimised in this model,” pointed Mr Jain making a strong case for hyperlocal start-ups in the country.
In the ecommerce space, white-labelled products or consumer durables are a tricky category as consumers are skeptic of the touch and feel of the product and after sales services delivered by the merchant. Therefore, sale of such products have proved troublesome for internet-based sellers.
But Zopper has designed a business model which helps it deal with such issues, according to Mr Jain. “We, at Zopper, make all the information about the seller completely transparent. We allow the consumer to do the research online and compare prices but the final purchase is taking place on the physical platform,” explained Mr Jain.
Mr Jain is expecting the market size to be 20 times larger than that of ecommerce players as consumer buying consumer durables and electronics are looking for a similar kind of experience.
The increased internet adoption in India is pushing more and more consumer to research for consumer durables or white-labelled good online and make the final purchase at an offline store. Zopper seeks to reinforce this trend in India. Mr Jain acknowledged that it is easier to study a product online. “Zopper helps in bridging the gap, the retailer is reaching out to the consumer who is researching online but making the purchase offline,” said Mr Jain.
Mr Jain added that India is yet to cover a large distance to emerge as a leader in the online shopping space. India harbours over 350 million internet users but only 30-35 million of them are making online purchases, according to Mr Jain. “This number is very small despite incentives like Cash on Delivery (COD), 30-days return policy and other seasonal offers and discounts and hyperlocal start-ups in the country are focused on capturing this gap in the country, “ he added.
Going forward, Zopper seeks to expand its services to 60-75 cities from 20 cities now. It has a network of more than 10,000 retailers who are servicing almost one million active users monthly. But the toughest challenge for internet-linked services in India is penetration into Tier II and Tier III towns of the country. Mr Jain accepted that the pick-up rate in the smaller towns will be slower against metro but with a 40 per cent growth in users monthly, he is not wary of exploring opportunities in the region and make Zopper a pan-India project.