The move to integrate JioMart with WhatsApp will allow hundreds of millions of users to order products from Reliance without having to leave the app. At last count, WhatsApp had about 400 million users in India. Facebook invested $5.7 billion for a 9.99% stake in Jio Platforms last year.
Reliance Industries Chairman Ambani is trying to capture a bigger share of India’s retail market, estimated to reach $1.3 trillion by 2025, as per the report. Note that Reliance is already India’s biggest offline retailer.
Reliance Retail has adopted a multi-prong strategy and operates chain of neighbourhood stores, supermarkets, and wholesale cash & carry stores, specialty stores and online stores. Serving the food and grocery category, Reliance Retail operates Reliance Fresh, Reliance Smart and Reliance Market stores.
In the consumer electronics category Reliance Retail operates Reliance Digital, Reliance Digital Express Mini stores and Jio stores, and in fashion & lifestyle category it operates Reliance Trends, Trends Women, Trends Man, Trends junior, Project Eve, Reliance Footprint, Reliance Jewels and AJIO.com in addition to a large number of partner brand stores across the country.
In April, Facebook Inc. bought a 9.9% stake in Reliance Industries’ digital unit Jio Platforms for $5.7 billion. JioMart was launched in May last year across 200 cities and towns, a month after Reliance Retail signed a pact with WhatsApp to boost the reach of the online shopping website. In July 2020, Jio announced that WhatsApp and JioMart -- Reliance Industries' (RIL) platform for kirana stores and customers would work closely to let the latter transact and also create opportunities for kirana stores in the country.
Mukesh Ambani said that JioMart has now enabled a multi-purpose point of service (POS) services to enable smooth transactions between stores and their users. "JioMart and WhatsApp will be working closely to create growth opportunities for millions of Indian small merchants and enable customers seamlessly transact with kirana shops," said Mukesh Ambani.
According to WhatsApp spokesperson to a news daily “Through our investment with Jio, we’re going to bring millions of small businesses and the customers they serve into the digital economy. This will make it easier for businesses to connect with customers and close sales".
Reliance Retail is also set to rope in local kirana stores as franchise partners to fulfil orders placed on JioMart. Reliance Retail will exit from the direct sale of packaged food, grocery and FMCG products. The kirana stores will sell these products to consumers in their respective neighbourhoods. Two industry executives aware of the plans mentioned recently that the kiranas will source goods from Reliance or elsewhere.
In the case of products ordered on JioMart and not in stock with the kiranas — which typically sell the 300-400 most popular items Reliance Retail will supply them and the margins will be shared equally. However, Reliance will continue with the sale of perishables such as fruits and vegetables from its stores or fulfilment centres.
Further, Reliance Retail has decided to shelve its B2B cash-and-carry store format, Reliance Market, which will be turned into fulfilment centres for B2B delivery of products to kiranas. The neighbourhood stores will place their orders online and get deliveries at their outlets.
WhatsApp Business app has its own inventory management feature which allows businesses to showcase and share products and services by creating a catalogue. The catalogue is then displayed on the business profile. Recently, the messaging platform added a shopping button that gives customers access to a business’s catalogue directly from their chat screen. Although, WhatsApp has its own catalogue feature, most merchants use third-party apps such as Bikayi and Dukaan. Though popular, such merchants don’t offer the same integration level that WhatsApp is trying to build with JioMart.