Amazon Trying To Win Indian Rural Population With New Logistics
Amazon has proved to be a major player in the e-commerce department in India but it has failed to attract the 800 million people who reside in the rural parts of India. Now you must be wondering how come a tech giant like Amazon who managed to compete with the homegrown e-commerce giant, Flipkart failed to intercept the rural target customers. There are a couple of reasons behind this such as limited access to the retailers and the lack of basic technological amenities such as credit cards and smartphones which are crucial for online shopping.
Moreover, many rural customers do not have basic knowledge of using an e-commerce application which is why Amazon has launched a number of tutorial videos to make it easier for them to switch to the e-commerce platform. Barclays PLC, a reputable investment bank stated that the tech giant has garnered approximately 48750 crores (including the 27862 crores from the rural population) last year which is about 2% of its gross world wide earning.
The company has also released an app called the Internet which can be accessed by a ‘lite browser’. This app is specifically built for low end smartphones which are used extensively by the rural population and aims at improving their accessibility to the services provided by Amazon.
With the recent advancement in 4G technology, Amazon is expecting that the online shoppers in India will triple by the year 2022. The tech giant is also taking into account that over 80% of its new customers is coming from the rural population of India and that percentage is expected to grow as the rural people become familiar with e-commerce technology.
To attract more rural customers, the tech giant is considering partnering up with small stores. It is also considering to offer huge discounts and free deliveries to change the negative perspective of customers towards online shopping. A number of tutorial videos have been uploaded on their websites as well as applications which are helpful for people who do not know how to read and write. The company has also made Hindi as a preferred language to make it easier for the rural customers to use the e-commerce application.
Delivering products to the rural people has always been a challenge due to the involvement of multiple middlemen and the size of the stores. This has resulted in high prices, low quality and poor selection of products for the rural people. To counter this, Amazon is considering turning these stores into their package depots and learning centers for the new customers who do not have prior knowledge about online shopping. It has customized its application specifically for the rural population like adding icons for electronic goods and books and adding recommendations as well as pop-up descriptions in Hindi. The standard ‘Add to cart’ option has been changed to ‘Add to bag’ to improve customer experience. The company has even changed over 30000 descriptions of products in Hindi and is planning to add other major Indian languages to attract more rural customers.
Another area where Amazon is focusing on is the delivery mechanism. With the help of logistics, the company is figuring out where the delivery capabilities need to be enhanced and is looking forward to small scale businesses for assistance. Amazon is also considering integrating the small stores into its global supply chain and adapting the technology so that the services can work offline, take signatures, return products, record payments as well as scan deliveries in remote areas.