Offline retailers take to technology

Noel Tata, Chairman, Trent, is candid about not approaching e-commerce companies to put up his retail formats such as Westside and Star Bazaar. He is instead is waiting for the Tata Group to set up its own site to initiate online selling.

On the flip side, Tata Group’s consumer durable retail venture under Croma has already set up its marketplace on Snapdeal, despite having a site of its own.

Brick & mortar retailers have realised the strategy now is to co-exist with e-commerce players and partner them when required till such time they gain competencies with their respective omni channel and online strategies.

“We will not look at somebody like a Flipkart to sell our ware. Several online players have sought to disrupt the retail market with deep-discounting funded by overseas shareholders. The sustainability of such deep-discounting is debatable but we need to nevertheless handle the onslaught and continue to be relevant. We will launch our e-commerce site in the fourth quarter of this fiscal through the Tata Group’s site,” said Noel Tata, to shareholders at the company’s recent AGM.

However Tata Group’s Croma stores had no option but to partner up with Snapdeal after announcing its own e-commerce venture three years ago. Today, it is trying to strike a balance by developing its own omni channel capabilities.

Others such as Shoppers Stop have also realised the power of partnering with e-commerce players, as it can never match the reach and technology provided by such online companies. Even its furniture format under Homestop is listed on Pepperfry.com while some of its private labels are available on Flipkart and Amazon.

It has also adopted technology through hybris software, a SAP company, and is investing ₹60 crore behind its own omni-channel strategy.

“There is disruptive money coming into e-commerce which is going into discounts and advertising. But we have stopped regarding them as a threat and would rather co-exist and join them while continuing to invest behind our omni channel strategy,” admits Govind Shrikhande, Managing Director, Shoppers Stop.

Others companies such as Future Group is also selling its private labels on Amazon while investing ₹100 crore on its own omni channel strategy. “We are selling the same products that e-commerce players are selling and there is no reason why we cannot do it on our own,” says Kishore Biyani, CEO, Future Group.