Flipkart, which recently broke online sales records during its festive season sale, is now looking to setup offline stores to target India’s smaller, but extremely important cities.
The move is said to be a part of the company’s online to offline strategy and is aiming to double the number of users on its platform, specially from smaller — Tier II/III cities. This will be targeted towards the remote areas of the country where awareness related to the e-commerce is pretty low and users do not get stable or reliable access to the internet.
We mailed Flipkart for a comment, but are yet to receive a response.
A person aware of the matter told LiveMint that the initiative, known internally as assisted commerce, is one of several the company is working on. The e-commerce firm is seeking to double its current user base as currently, the growth in the e-commerce market is flat.
According to the report, Flipkart’s engineering head Ravi Garikipati has confirmed that the company is working on the assisted commerce idea and that it is still at an early stage. He added:
Basically we want to have some sort of a connect with the offline world as well—this is one of our upcoming initiatives, but it’s not something that’s out there yet. As we are looking ahead and trying to grow the market and win over the next 3-5 years, there are a few things we need to do.
However, Flipkart isn’t the only e-commerce startup in India going the online-to-offline way. Amazon India has also launched its offline shopping initiative called Udaan in late 2014.
Under this initiative by Amazon, it selects and trains local entrepreneurs which can showcase their products in smaller cities and towns as well as in regions where Internet connectivity is not that good.
It has also signed a partnership with StoreKing, which is already present in more than 10,000 rural outlets across South India. The company offers product information and shopping services in regional languages, a key attraction for rural shoppers.
While the competition is fierce in the e-commerce segment, the companies in India have struggled to expand the market this year. Flipkart faced a series of valuation markdown and is also struggling to raise further funding at its desired valuation.
As per the research by RedSeer Management Consulting, online retail sales fell to an annualized $12 billion in June compared with $15 billion in December.