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India has more market potential for the e-commerce industry than China has, according to renowned retail futurist and author Doug Stephens.
As global retail and e-commerce giants Walmart and Amazon fight it out in the country, India is becoming the primary battleground, elaborated Stephens, adding that if companies own India and China markets, then markets like the US don’t matter.
Middle class appetite
“The middle class explosion in India is going to be nothing like we have ever seen before,” said Stephens. Amazon is reported significant losses in India for FY 2017-18, but Stephens felt that the company will continue to battle in the Indian market. “I don’t expect to see Amazon give up on India any time soon,” he added.
According to Stephens, Amazon is keen on the grocery delivery business as a customer’s grocery shopping and requirements can provide data and insights on their food, dietary, and health habits, family status, and other such preferences.
Newer opportunities
“All of these things, for Amazon, open up new marketing opportunities,” he said. In India, Amazon sells groceries via Amazon Pantry, which saw a few hiccups after the new e-commerce norms kicked in earlier this year.
The kind of data that Amazon gathers on consumers and their behaviour also comes from its set of AI-enabled Echo speakers that are powered by the Alexa virtual assistant, Stephens explained.
Also read:Next level of consumer growth in India in 2019 through e-commerce: Deloitte
The Echo speakers are also found in hotels and Alexa powers operating systems in some cars, “painting a picture of individuals, their households and their needs,” he said. But what is Amazon going to do with all this data? Stephens said that in 2015, Amazon applied for a patent called “anticipatory shipping”.
Crowded digital space
“Amazon, at some junction, believes that they will have enough data on individuals and households, that they will begin to start shipping things to you before you know you want them,” he said. Stephens also noted that as the digital space gets populated with an overdose of information, it is becoming increasingly difficult for products and brands to get their message across to consumers.
This is where physical stores become important as powerful media channels, he said. “Department stores won’t make money 20 years from now by selling products. They will sell experiences and they will get paid for it,” Stephens added.
For example, companies such as Chinese tech player Xiaomi have started to focus in a large way on the offline store space in India as its online sales have saturated. Xiaomi has opened Mi Home Stores and Mi Studio Stores, where customers can experience the company’s products before buying them.
The writer is in Dallas at the invitation of SAS Institute
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