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'Jugaad' bends the rules of e-commerce too!

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Srinivas Padmanabharao

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The word Jugaad is synonymous with innovative approaches to solving problems using commonly available tools and materials. The famous book titled 'Jugaad Innovation' showcases a number of examples.

Recently I experienced something that I think reflects this thinking and may herald a new era of generating breakthrough growth in many regions of the world. A few of my most recent online transactions were buying a bicycle, arranging for daily delivery of milk to my door step and paying my newspaper vendor.

Srinivas Padmanabharao Srinivas Padmanabharao

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What makes these transactions unique is the one common thread running through them - they were all arranged 1:1, using commonly used social platforms, with a seller who doesn’t have an online presence in the traditional sense of the term, e-commerce.

Such businesses and business owners don’t have any apps that I need to download or sites I need to visit and what’s more, I didn’t go looking for them -they all came to me through referrals from my friends and neighbours with the transactions all being arranged via WhatsApp.

Research suggests that in India, mobiles will continue to gain importance as a channel to drive financial services and commerce.

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Many individuals and small business owners (and some large ones) today use social tools like Instagram, Line and WhatsApp to conduct their business and are successfully marketing and servicing their customers via such media.

This is the new world of p2p Commerce or peer-to-peer commerce which may represent the next generation of online retailing and commerce.  An increasing number of examples are coming to light, especially in the developing world which represents the Jugaad nature of this trend and may well catch on and spread far and wide.

From a buyer perspective this is a significantly simpler and more personalized interaction as he deals directly with the seller whom he trusts, via messaging or even a phone call as required, because it comes to him from a referral from a friend.

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Given that the purchase process is more simplified and trust worthy for me as a buyer and the sales channel is low cost (or free) and direct for the retailer, I believe that p2pCommerce holds the potential to bring online commerce to more buyers and sellers around the world.

Some other global examples include Brazilian companies providing customer support via WhatsApp, Nordstrom opening a Instagram store, Jumia in Africa and e-commerce via LINE and Instagram in Thailand.

It is clear that traditional online retailers (doesn’t it sound strange that we are referring to online retailers as traditional?) will need to evolve to compete with these new business models.

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For e-commerce companies in India, P2P commerce, is both a threat and an opportunity. The resellers on their platforms can now establish their own commerce presence on public platforms and potentially bypass the online retailer, especially those that cater to localized markets.

On the other hand e-commerce companies, with the right scale and technology expertise can incorporate P2P commerce into their business models, by providing customers new ways of interacting with them and the resellers on their platform. This will help build scale and greater loyalty through improved customer service to help justify the company valuations in this space.

The author is Director, Product Marketing of Akamai Technologies

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