Digitizing the Long Tail of Ecommerce and Local Services

We’re going through a significant degree of change here in my home country. As far as historical trends go, this is the fastest pace for any change and we squarely blame technology for what’s happening. Oddly, one might live through an entire decade and yet not notice this change.

In a conversation last night with a friend, I learned a great deal through his outlook on how things are shaping up. His family is talented and have many gifts to share with the world. His Mother’s written several cookbooks and has deep insight into to food and lifestyle choices we make. He himself intends to create a niche portal to service pets.

Another friend of mine who has been tracking the growth of e-commerce in the United States from inside the industry alerted me to what’s actually happening here. While today, valuations are driven by captive e-commerce infrastructure, the more reliable metric is still lifetime value of the customer. Flipkart, Amazon and the other incumbents are essentially responsible for developing the long tail of e-commerce here in India*. To help understand the scale of change that’s needed, the contrast you need to grasp is that for every one e-retailer in India, there’s essentially a 1,000 and more in the US.

Another segment that’s changing rapidly are B2C services in India. They directly stand to benefit from the digitization of the last mile between the business and its customer thanks to mobile internet.

On my way to work, my auto driver started up a casual conversation with me. In the midst of the conversation, he asked me if I knew that Ola cabs had enabled auto drivers on their digital service. I had indeed. He then politely asked me if he could have my number to refer back to Ola and claim a reward of a hundred rupees. I said I’d gladly share and sign up.

Those drivers who go out and get themselves a tourist cab might opt-in to Uber and a myriad of other services. I can now hail a cab or an auto within 15mins no matter where I am in Pune. This is especially helpful late nights and in the outskirts of the city.

One place I can see where this’ll help is at our local airport. If you talk to the prepaid autos at the airport, they’ll often charge 1.5x to 2x the fare back to the city. The cops there don’t want to do anything about this as they’re looped in on the take as well. The justification for the premium is that all auto drivers need to pay a fee to enter the airport (to whom?). The next time I’m there I’m going to try hail an auto for myself using the App from outside the airport. I hope that’ll work.

The question “What’s the next $Bn startup out of India?” just got a whole lot more interesting!

* I am what one might call a skeptic, but its hard to argue against overwhelming evidence and specifically Amazon’s decision to permanently set up shop here having patiently waited since the mid-2000’s.

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One Comment on “Digitizing the Long Tail of Ecommerce and Local Services”

  1. teatimechic says:

    I think that the focus shouldn’t just be digitization but secure digitization. Too often e-tailers overlook that. Excellent post.