Mukesh Ambani is taking e-tail by storm — JioMart already has more daily active users than BigBasket and Grofers
- The e-commerce debut of Reliance, is being touted by analysts as the real digital powerhouse for the RIL family.
- Having started with a beta launch in December 2019, JioMart officially rolled out to users across the country in May, 2020.
- JioMart went into a fast expansion mode during the coronavirus lockdown in India and has managed to gain an early mover advantage in the country’s smaller towns.
AdvertisementJioMart – Mukesh Ambani’s ambitious e-commerce bet has taken off and how! Having started with a beta launch in December 2019, JioMart officially rolled out to users across the country in May, 2020 and it already has a million daily active users, and 2.3 million active users every month, according to a JPMorgan report.
The same report said that, JioMart has already crossed BigBasket and Grofers in terms of daily active users and falls behind Swiggy. Business Insider reached out to BigBasket and Grofers for their comments regarding their daily active users, both the players declined to comment.
India’s online grocery segment: The players
As of December 8, 2020.
|Company||Launch date||Presence (no. of cities)||App downloads|
|Amazon Fresh||August, 2019||9||314 million (for Amazon)|
|Flipkart Supermart||November, 2017||5||361 million (for Flipkart)|
|Swiggy Stores||February, 2019||30||89 million (for Swiggy)|
|BigBasket||October, 2011||26||34 million|
|Grofers||December, 2013||30||30 million|
|JioMart||December, 2019||200+||4 million|
While other entrenched players like Big Basket and Grofers, who have been around for much longer, still have 7-8 times more app downloads, the rise of JioMart in the last six months only reflects the speed at which Ambani has tried to push his ecommerce dream. Since its launch, in every three downloads of any online groceries app, two of them have been the one from the house of Reliance Industries (RIL).
Even the mightiest need to hustle sometimes
JioMart in India sees competition from many players who have existed and dominated the Indian e-commerce market for a long time – including the likes of Amazon and Flipkart. And so, as Ambani, Asia’s richest man, threw his hat into this ring, he decided to go all out: both in the big cities of India and beyond.
JioMart operates with an omnichannel flow where it has tied up with kirana stores (mom-and-pop stores) and also uses inventory from Reliance Retail outlets. Ambani’s e-commerce bet made a soft launch in December 2019 in select areas of Thane, Navi Mumbai, and Kalyan.
But as the coronavirus lockdown began and the opportunities in e-grocery became more evident, JioMart was quick to act and expanded to over 200 cities. This fast growth across India has given JioMart an early-mover advantage in India’s smaller towns, say analysts at JP Morgan.
Given the progress of JioMart in the first year, analysts at JPMorgan peg that Reliance’s e-commerce business may earn an annual revenue of over $59 billion and the net worth may hit $145 billion in the next ten years.
A Goldman Sachs report from November 2020 had pegged this omnichannel capability — using different channels for distribution, both online and offline — as the reason for JioMart’s growth. “India has 10 million kirana stores, which account for 90% of grocery retail in the country. JioMart has already launched in more than 200 cities, leveraging Reliance Retail’s store network, with kirana partnerships across 20 cities,” said the Goldman Sachs report.
JioMart is not just stretching far and wide, it’s also building strength via partnerships and acquisitions
Ambani is not just going for geographic expansion but he is also on a spending spree to boost JioMart’s offerings to its customers. According to JPMorgan, JioMart’s stock keeping units (SKU) is only second to Big Basket. However, the comparison didn’t include players like Flipkart, DMart and other new entrants like Swiggy and Zomato.
JioMart, with access to the deep pockets of one of the world’s richest man – Mukesh Ambani, has managed to successfully partner up with another of the world’s richest man – Facebook founder Mark Zuckerberg. Facebook pumped in $5.7 billion into Reliance Jio in April 2020, with WhatsApp’s integration with JioMart being a prime focus of the deal.
It’s set to be a win-win for both Ambani and Zuckerberg – where Reliance can take advantage of WhatsApp’s 400 million user base to acquire more customers. On the other hand, WhatsApp Pay, Facebook’s debut in the payments segment, will benefit from integrating with JioMart for payments.
Another early acquisition made by the company was that of the Mumbai-based Grab-a-Grub. In 2019, Reliance pumped in $15 million for 83% stake in the hyperlocal delivery startup. Reliance has also acquired online pharmacy company NetMeds, picked up a stake in online lingerie retailer Zivame, and online furniture retailer Urban Ladder, all of which could further bolster its e-commerce foothold.
The acquisition of Kishore Biyani’s Future Retail for almost ₹25,000 crore also gives JioMart access to BigBazaar stores across the country as well. However, Ambani and Biyani are in a legal battle with Amazon that has challenged the deal both in India and abroad.
Amazon got an “operation successful, patient dead” verdict — Lawyers say the Delhi High Court order is actually a win for Kishore Biyani and Future Group
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