Mukesh Ambani, Visionary Leader & Industrialist
Reliance a name of success led by Mukesh Ambani has a great blend of strategies. We have seen how JIO had created an eco in the telecom valley. I must say empowered the users by giving a free and fast Internet. They always want to create something big, innovative, and disruptive.
No doubt Reliance has such great appetite and that's why doing in these streams. Retail was always an envoy for Mukesh Ambani and an interesting subject for Ms Neeta Ambani.
I remember when reliance fresh started. It was a piece of big news that Reliance is going to explore and exploit farmers through monopoly in buying. Hectares of land were taken on lease or contract farming had been done. Yes, somehow it could not leave an impact that time but the straw was in the eyes and propelling Mukesh Ambani to enter Retail some big way. Ambition to achieve something big is the ultimate power of our subconscious mind but very few people realize the fact that we have the power to dream about it. Mukesh Ambani got his fortune only by doing things smartly.
The idea and its Journey :
Jio platform is
the brainchild of Mukesh Ambani which always propels him to place it somewhere
on top of any competitors. While launching Jio in telecom they made it bigger
than their existing competitors. With this great ambition, he started Jio
platform in 2019. It was founded with a clear vision that a scalable business
model should be started where the investor will have trust and they can see a
bigger future in the ecosystem. Moreover, reliance has its own offline stores
presence in more than 200 cities so leveraging them a kind of security and
surety about its launch and pilot run across the channel. Idea was to rule
the Indian eCommerce.
All strategies
were built during 2017 and 2018 that how Jiomart should rule the Indian e-commerce
business and for that Mr Manoj Modi, one of his old fellow and retail veteran
started giving shape to this idea. Applying certain logics and putting together
the strength of existing offline retail stores, a blend of passion and vision
made it clear that Jiomart will have a big consumer base which will drive it to
a great helm of retail, so a scalable business model is built in a very short
period.
Since the beginning,
moto was to make it investible as huge money is needed for customer acquisition
and retaining them loyal for a longer period. Mukesh Ambani wants to run
a debt-free venture so this idea was taken care during the whole journey. This
was also an important decision for them to think for this kind of business
model where a strong player like Amazon and Flipkart has already dig a deep
penetration in the retail landscape and doing great at service side. It
was clear to convince Gulf based funds to invest in Jio mart, it was somewhere
strategic in petroleum business dealings which reliance do not want to carry
for longer so they want it to partner with Gulf Petro dealers. On the
other side, social media Giant Facebook leads the stream first time in Jio
platform. It was the web that started by Facebook, since then 13
investors had invested more than $20.5bn which is almost INR 153000 Crores (33%
Stake ). Somewhere it is hard to predict the mindset of investor that why they
invested so heavily in JIO platform but as per my personal views and some
inherent powers of judging and predicting about someone is that Mukesh Ambani's
majestical power made investors convinced to invest. Then Google made it clear
that millions of consumers are going to use Jiomart for their shopping needs
will make a strong data bank for them. AI will be the strong upcoming
experience for tech-based companies so Google made it clear about their
business agenda.
Apart from Facebook & Alphabet (Google), 11 other influential investors believe in the idea: Major one is: Vista Equity Partners, KKR, Silver Lake, General Atlantic, TPG, L Catterton, Mubadala and Abu Dhabi Investment Authority
Acquire Capabilities & Pace up Growth in big way
Another power punch strategy was to acquire various retail activators/technology companies who were working in the retail ecosystem in bits and pieces. Here they acquired the capabilities for faster growth and pacing speed in execution. Few of them are from data minings and fintech aggregators.
Association with Local Retailers : "Sab ka Sath Sab ka Vikas"
No one understands retail the way Reliance understands, that Indian Grocery retail ecosystem is so complex and so fragmented which can not be made organize in one shot, and if someone try to test this, they have to burn billions of dollar for getting a pinch of it. In Past many big players tried to replace Kirana retailers by way of creating competition for them but they become a successful failure and soon realized that Kirana retail is the lifeline of Indian retail which can not be completed or eliminated so why so fight with them. They started the Kirana development program and blend thought to make them partner in their Jiomart journey. A pilot run was started mid of 2018 in Gujarat and Mumbai by introducing POS system in the retail stores but again it was a different segment so could not come across but idea was to bring Kirana store under their forte for facilitating hyper-local delivery points. In my personal views working with Kirana wala need a different kind of capability which as a company Reliance can not do or it will remain a challenge with two mindsets. Rather going directly with them they need a proxy name to work with Kirana stores. This will give them good mileage and a good market in GT network for offloading their private label. So Reliance needs to either acquire companies working in the ecosystem or associate them for their staples range in GT market.
Challenge from part of ecosystem & Way Forward:
The way competition is coming in this segment, it will create a disturbance among existing Kirana retails. Thousands of retailers are going to lose their business because of online penetration and diversion and cession of footfall day by day, so more agitation will be somewhere harmful to companies like Amazon and Flipkart and so some extend Reliance. Being Reliance Jio an Indian company has many benefits which foreign retail players can’t avail, so many things are easing the growth but challenge is there. In my view Reliance need a strategy to drive Kirana Retails differently and should acquire company who are empowering Kirana Retails for growth side of Retailers.
My this write up is dedicated to Mr Mukesh Ambani for his Vision and Passion and I always respect him for his innovative ideas. I believe Jiomart will be the largest E-commerce player in days to come.
