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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.