The Tata Group on Friday became the newest entrant in the country’s e-commerce marketplace landscape with the launch of Tata CLiQ. Com, which will sell apparel, footwear and electronics...
The Tata Group on Friday became the newest entrant in the country’s e-commerce marketplace landscape with the launch of Tata CLiQ. Com, which will sell apparel, footwear and electronics to begin with and soon branch into accessories, luxury products and products in the home and furniture category.
Asked whether it can now provide meaningful competition to the already established online marketplaces in the country, Ashutosh Pandey, CEO of Tata Unistore said, Google was not the first company to launch a search engine but now is the most popular.
Customers can order online on the website of Tata CLiQ and get items home-delivered, or pick them up at designated stores, a model the company calls “phygital”, which is basically a combination of physical and digital.
According to the management, products bought on the platform can be returned or exchanged in 532 stores. Another 122 stores will act as pick up stores from where consumers can collect goods bought as per their convenience and shipments will be dispatched from more than 102 stores. At the moment the Tatas will have just one warehouse, which will mainly store its luxury offerings. In a sense, the group is leaving no stone unturned by utilizing its deep pockets and already well established allied businesses, a significant advantage it has compared to its online rivals.
In the past couple of years, every large marketplace has gone hyper-local, a tried and tested formula that has best served the demand of one-day-delivery. But Pandey said investing in hyper-local businesses have not boded well with those companies. Besides, CliQ will address that concern by shipping from one of Tatas stores instead of investing. For instance, if there is an order for a refrigerator, it will be routed to the closest Croma outlet and delivered in a time frame that will be competitive, he explained.
A late entry might even bode well for the group having observed some of the trial and errors of its peers. At the moment, rivals at K Raheja Corporation and the Aditya Birla Group are still in the process of setting up and rolling out their omni channel networks in a phased manner. These companies have only recently started rolling out sophisticated customer loyalty programmes, realizing they cannot compete with the online market places in deep discounts. Accordingly, CliQ ensured it has more attractive policies. For instance, on apparel it has a month long exchange window, which the company claimed is highest in the business.
A qucik survey of the website revealed that even though there are discounts prevalent on products, the steepest is in the range of 20-25%. Kumar Rameshwar Singh Jamwal, executive director of the Tata Industries said the company is not averse to using discounts as a tactic but not as a strategy.
Although the company management did not divulge investment details, it clarified it has not taken debt to build its platform. Almost all online marketplaces have depended heavily on borrowings and steep discounts and now the money is running out. In a sense, CliQ is shielded, having been bankrolled by the Tata group itself. Certainly, its funding is more patient than investments brought in through a clutch of PE (private equity) investors. Even the technological support, which is the backbone of an e-commerce website has been provided by Tata Consultancy Services. Its 2000 stores across brands will act as localized centers, providing logistical support to deliveries.