How eCommerce Impacted Logistics Business in India?

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eCommerce Logistics IndiaECom Express is a logistics company catering to the needs of e-commerce industry, which is growing at a fast pace in India. The company was launched in early 2013 focused on providing the last mile delivery services to the eCommerce companies. ECom Express started with 311 employees in 35 cities. It has grown to 653 delivery centers in 180 cities with 15,000 employees and 450,000 Shipments/day. 90% of the staff are delivery people.

Logistics is a relatively large part of cost for eCommerce players and they intend to rationalize it. However, ECom Express believe that the quality of services in terms of timely delivery, reliability and lower product returns are key factors for eCommerce player to select a logistics company and not necessarily pricing. ECom Express is confident that given the quality of its services and its ability to delivery products to even less-accessible areas places it well in the market. The company

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Reliance Jio Launch – Device Strategy Unveiled

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Reliance Jio Mobile HandsetsReliance Jio Infocomm is expected to launch with three types of device offerings – 1) Dual SIM smartphones; 2) MiFi device; and 3) Vo-LTE smartphones. Amongst these, a dual SIM smartphone could be the most attractive to a consumer (in the early stages of launch) as they could continue to use their existing telecom providers’ SIM to make voice calls and use Jio’s SIM for access to high-speed data offerings.

RJio’s MiFi devices can be more popular among the niche high usage consumers (particularly youth) and expect it to compete head-on with dongle offerings from companies like RCOM, Tata and MTS. The uptake of Vo-LTE smartphone (which allow Vo-LTE calls) would be contingent on the quality of calls the new network is able to deliver. RJio suggest VoLTE trials have been

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Internet in India – From Access to Transactions

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India had the third largest (243.2mn) number of internet users in the world in 2014. The pace accelerated over 2015 with 375mn user base in October 2015, according to a joint report by internet and Mobile Association of India (IAMAI), an industry body and IMRB, a market research agency. It is projected to reach 402mn, ahead of the US though behind China, by December 2015.

While the base and growth in internet users has been impressive, the penetration rate performance has been tepid relative to that in the US and China. We believe India

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Airtel to Increase ARPU amidst Reliance Jio Launch

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Airtel Vs Reliance JioBharti Airtel expects modest annual increases in blended ARPU in coming years led by data (assuming rationality on the part of Reliance Jio). Airtel admits voice ARPUs will continue to dip but does not think cannibalization of voice by high-speed data is a risk, likely underestimating this voice ARPU reduction risk. Airtel thinks that higher ARPU subs (post-paid or high-end pre-paid who would be early 4G adopters) hardly churn and that pricing per se is not a factor in churn at the high-end. Additionally, it is rapidly rolling out 4G on a large scale not giving its high-end 3G/4G subs reason to shift to competition. Data traffic will continue to grow at a robust pace driven by increases in penetration and per sub consumption growth. Better data network and newer technologies (such as 4G) itself allows higher consumption on a like-for-like basis.

Plain Vanilla 2G Voice
On the contrary, incrementally new subs are coming from low-ARPU rural areas, total voice ARPU will likely continue to trend down. Urban wireless penetration

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India moves to become an IoT Economy

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IoT Economy IndiaIoT – Internet of Things brings together a complete set of technologies (sensors, wireless systems, computing, storage, system integration) for use cases like bringing economies of scale, reducing complexity of business, ability to know different assets and their health, and predictive maintenance.

According to the Secretary of the Department of Electronics and Information Technology (DeitY), the government had released a draft policy on IoT, which is at the consultation stage. The government is adopting a Public Private Partnership (PPP) model for this. Under different programs, the government is partnering with and helping start-ups, mentoring them to develop innovative breakthrough

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Reliance Jio’s Contrarian Approach to Airtel – Adopts Asset Heavy Model

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Contrary to the current trend, Reliance Jio prefers an asset-heavy model. The basic premise is that assets created at a large scale and competitive capital cost provides a long-term competitive advantage through business cycles. Cost-leadership is the core mantra of Reliance Group – this is achieved via capacity creation at a massive scale. For the telecom sector, spectrum and technology are viewed as the two factors of production – the former is scarce and finite whereas technology costs tend to decrease exponentially. So Jio would tradeoff in favour of cheaper spectrum with nascent ecosystem compared to a technology with good current ecosystem.

At launch we estimate Jio to have

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Rise & Growth of Mobile Finance / Payments using JAM Trinity

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Rural India Mobile PaymentTechnically, e-finance is any financial product whose sale or consumption is facilitated electronically – or more specifically, via the internet or mobile. The ‘e’ part of e-finance is supposed to help reduce transaction costs, increase processing efficiency, and provide instant access to information. Some examples across the retail and corporate spectrum are identified below:

Retail – Being able to conduct a payment transaction on a mobile phone to a service/product provider without the physical exchange of cash, or being able to borrow from a bank via an online platform without any manual

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Flipkart Vs Amazon Vs Snapdeal Performance in Festival 2015

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eCommerce IndiaWe’d like to compare the eCommerce strategies of the Big 3 in India during the recent festival season.

Instead of a single Big Billion Day sale last year, Flipkart held this year’s sales over 5 days between October 13-17. Flipkart sold products worth Rs. 20bn (c. $300mn) this year (vs 6bn sold last year), with a total of 8 mn units being sold, compared to 2.7million units being sold last year. The company saw 150mn visits over five days in comparison to 40mn traffic registered last year. Mobile remained the highest selling product registering $200mn worth mobile sales (vs $60mn sold last year) with 250 mobile phones sold every minute during the 5 day sale. Flipkart clocked 5million app downloads over the course of the sale.

Amazon held its Great Indian Festive Sale overlapping the Flipkart sales (over October 13-17). While Amazon did not share specific

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Reliance Jio LYF SmartPhones Ready to Hit Market

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RJio LYF MobilesGreenfield 4G LTE Telecom Operator Reliance Jio Infocomm has been aggressively negotiating deals to create an affordable 4G LTE SmartPhone eco-system. As a 4G only operator Jio is pushing the improvement of 4G smartphone in India. Apart India’s 2 biggest handset companies (by market share) Samsung and Micromax, Jio is also working closely with almost all handset companies to not only have their own branded phones but also ensure other companies come up with their own smartphones.

The company is looking for 4G phones to be priced between Rs 5,000-25,000. Jio would need a 5 band phone which works on 900, 2100 bands along with 800,

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Mobile Advertising & Ad-Blocking War Intensifies

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Mobile Ad Blocking WarA 2015 Reuters Institute digital news report found significant consumer dissatisfaction with online advertising, expressed through the rapid take up of ad blockers and disquiet over the blurring lines between editorial and advertising. Reuters found that 47% of a US sample and 39% of a UK sample used ad-blocking technology, and the IAB has similarly found 34% of US adults use ad blockers.

Eyeo’s popular desktop ad blocker has been on the market since 2006 and has gained as much as ~40% market enetration in the US. It reports >400m total downloads of its software. Ad blockers for desktop advertising do pose a threat to the digital marketing industry if advertisers shy away from marketing on websites knowing that a large portion of their ads won’t be seen.

Ad Blocking on Mobile SmartPhones
Smaller screen sizes on mobile and poor battery life

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