Amazon'sAmitAgarwalhascreatedsolutions

uniquetoIndia
AmazonhascometobeseenatthecentreofallbigeventsinIndianecommerce

SuveenSinhaApril15,2017LastUpdatedat02:07IST

Ifyoumeet
Agarwalfive
monthsapart
asthis
writerdid,in
Octoberlast
yearand
Marchthis
yearthe
cruxofthe
interviews
wouldlikely
bethesame.
Agarwal
wouldsay
thatthe
magicofe
commerce
liesingetting
youwhatyou
wantatalow
priceand
haveit
deliveredit
fast.

Hewould
AmitAgarwal.Photo:SanjayKSharma
talkaboutthe
threepillars
ofAmazonbeingselection(thenumberandrangeofitsoffering),competentprices,andfastdelivery.Sure,
somenumberswouldchange:theselectionincreasedfrom85millionitemsinOctobertomorethan100million
inMarch.

Butthecruxoftheconversationremainsthesamebecause,asAgarwalputsit,hehasbeendoingthesamething
everydayforthepastfouryears.Everydayweaskourselves,howdoweaddmoreselection?Whattoolshall
webuildforsellerssotheycanofferbetterpricing?Howcanwedeliverbetterandfaster?

AndAgarwalwouldtalkaboutAmazonsbeliefinhavingastubbornvisionthatmaybeaccompaniedbya
flexibleexecution.
Thesearethingsthathaveremainedconstantnotjustforthelastfouryearsbut20.Manyofthesewerelaid
downinthefamouslettertoshareholdersAmazonsfounderandCEO,JeffBezos,wrotein1997,theyearthe
companywentpublic.Partofglobalbusinesslegendnow,thatletterwasallaboutthelongterm,ignoringa
publiclyheldcompanysneedtodeliverquarterlyriseinprofits.

WhatAgarwalhasdoneishehasusedtheflexibleexecutionoptiontoimplementinIndiaanAmerican
entrepreneursvisioninaveryIndianway.WeareanIndianglobalcompany,hesays.

Itisnotahollowclaim.

Aboutthreeorsoyearsago,whendiscussionsovercupsofteawereswayingthecourseofaParliament
election,Amazonwashavingitsownchaipecharchawiththepeoplewhosellonitsonlinemarketplace.

WheneverAmazonspeoplewenttosellerstobringthemonline,theirhostsasked:Chaipeeyengekya?(Will
youhavetea?)

SoAmazonsetupitsownchaicarts,hundredsofthemindozensofcities,whichgaveoutfreeteaassellers
congregatedforadiscussion.(ThecartsservedcoffeeinsouthIndia.)

AmazonsawthatalotofpeopleinIndiadidnottrustonlinetransactions,buttheytrustedthelocalservice
provider.SoAmazondecidedtogetoutoftheway.ItsProjectUdaanturnedthelocalserviceproviderintoan
allythatwouldsellproductsforAmazon.

TheglobalconceptofAmazonfulfillmentcentres,wherethingsaredeliveredbysellersandpickedupby
couriersafterpackaging,acquiredanewdimensioninIndia.Whenwewenttosmallshopkeepers,wefound
theyhadownedtheshopforgenerationstheirfixedcostwaszero.Whywouldtheycometoourfulfillment
centres?saysAgarwal.SohestartedEasyShip,whichcomestotheshopstopickuptheirproducts.

AprogrammecalledIHaveSpacehasturnedthelocalgrocerystores,bakeries,daycarecentrespeoplewho
knowtheirneighbourhoodintoAmazonspartnersfordeliveryofproducts.Itnowhasanetworkof12,500in
morethan50cities.

Andthenthereisthefirstpillar,theoneofselection,whereAgarwalseesIndiagallopingaheadofAmazons
moredevelopedmarkets,suchastheUnitedStates,inthenumberofitemssold.

Globally,wehavehundredsofmillionsofproducts.ButthereishomogeneityintheUS.Indiahassomuch
diversitythereisnoreasonwecannothave25timesthenumberofitemsinIndia,hesays.

HeisproudofathankyouemailsentbyawomanwhosefamilymovedfromAndhraPradeshtoAssam.This
womanwashavingtroublecookingforherfamilybecauseshewasntgettingherfavouritespicesinGuwahati
untilshefoundthemonAmazon,whichcouldbedeliveredtoherhomeinaday.HeremailsaidAmazonhad
finallymadeherfeelathomeinAssam.

ThatemailmakesAgarwalsmilenotjustwithpridebutalsoempathy.HegrewupinMumbai,asdidhiswife.
Bothbelievenoothercitycangetthevadapaavmasalaright.AmazoncandelivertheMumbaimasala
anywhereinIndiaatadaysnotice.

ItisanapproachthatcameinforflakfromrivalssuchasFlipkart.DuringthelastfestivalseasonofDussehra
andDiwali,thesaleofsmallitemslikechuranandhingbecameatalkingpoint.Amazon,asusual,tookpridein
itsabilitytosellanddeliverthese.Rivalsdidnotthinkmuchofit.

Therivalsscoffingwasnotwithoutreason.Howmuchmoneycanonemakebyinvolvingacumbersome
systemofsourcinganddeliveryinasmall,lowvalueitem?
Agarwalhasareadyriposte:Ourvisionistobuildtheearthsmostcustomercentriccompany.Thatcanbe
donebyidentifyingtheirneeds,andgainingtheskillstodelivertheirneed.Thatisdifferentfromthemodel
othersfollow,whichistomakeabusinessoutofwhatyouhave.

TheresultisthatAmazonadds180,000itemstoitsIndiaplatformeveryday.

Onceyouletthatfiguresinkin,youmightwonderwhyitisimportanttohaveeverythinganyoneanywhere
needs.The85millionproductsAmazonhadlastOctoberwouldprettymuchcovermostofeveryonesneeds.
Whyraiseitto100million,andthenkeepaddingtothatenormousnumbereveryday?

Agarwalofferstworeasonsforthat:trustandhabit.Thebeautyoftheonlinemodel,hesays,isthatthereis
noshelfspace.IfthereexistssomepersoninIndiawithsomeneedatanygivenpoint,andifyoucoverthat
need,youbuildtrust.

And,ifyouconvincepeoplethatthereisaplacewhereyoucanfindanythingyouneedandhaveitdelivered
fast,itbecomesaneverydayhabit,theholygrailofanycommerce.

Indiansanywayliketoseealargenumberofoptionsbeforedeciding,atraitAmazoncapturedinitsAur
DikhaoAurDikhao(showmemore)campaign.

Thenumbersbackupthisapproach.ReportssayAmazonIndiasgrosssalesvolumegrew85percentinthe
threemonthstoMarchoverthesameperiodlastyear.ThatisseentobemuchfasterthanFlipkart,whichitselfis
inthethroesofarevival:ofbusinessandfunding.

Justasimportant,AmazonhascometobeseenatthecentreofallbigeventsinIndianecommerce.IfFlipkart
raisesfunds,itisarmingitselftofightAmazon.IfSnapdealisnotfacingthehappiesttidings,itisbecause
Amazonhastakenthewindoutofitssails.