Prathyusha Agarwal, Business Head at Shopsy, says these consumers seek quality, but not necessarily the brand label
India’s next digital commerce boom is not metro-led; it is rising from the heartland, the ‘belly of Bharat’. Noting that this expanding segment of non-metro consumers is fast emerging as the growth engine for value commerce, Prathyusha Agarwal, the Business Head of Flipkart’s Shopsy, highlighted that the consumers in non-metros are time-rich and very cash-conscious, unlike metro dwellers who are often cash-rich but time-poor.
These shoppers are characterised less by disposable income and more by intent. She added that they are discerning, cost-conscious, and increasingly online. Noting the mindset shift among these consumers, she explained, “This consumer wants good quality but not necessarily the brand tag.”
In an interview with BW Businessworld, she added that as the hypervalue industry continues to grow, being able to reach every corner, provide a unique product experience will drive the growth going ahead. Explaining just how sharply the center of gravity is shifting in India’s ecommerce story, she said that around 70 per cent of users now come from tier two towns and below, in the case of Shopsy.
India A Vs Bharat Consumers
Highlighting that whenever one thinks of India, the Business Head of Shopsy stated that there is a top small percentage, and then there is the belly of Bharat. She asserted that consumers in the latter segment always put affordability as a parameter. She noted that the brand’s core has been providing a selection all under Rs 500.
“Our ability to provide the selection that they want, at the price that they can afford, the quality that is lasting and is value for money, and in a product experience which is made custom-made for them, that is what I would consider success for Shopsy,” she explained.
She stated there are two distinct segments in India. There are the India A consumers who come with the wallet power, but the growth dynamics is coming from the belly of Bharat value shoppers.
Affordability And Value-consciousness
Explaining that consumers in non-metros have the time and the notion of value-consciousness, Agarwal noted that platforms that offer a selection at affordable pricing are expected to bring many of these consumers’ purchases online.
“A lot of Shopsy’s growth, last year, has come from the general merchandise, beauty, home and kitchen categories, because that millennial woman is purchasing for all her needs. Now she knows it is affordable. She does not have to carry loads of weight shopping and getting it back from the market. So she is accessing it online,” she noted.
Rising Stake Of Value Commerce
Value commerce has carved its place into the ecommerce ecosystem and has grown to around 15 per cent share in the last three to four years. Noting that Shopsy has been part of that growth story, she added, “It is likely to grow even more because the next 200 million are going to be very value-conscious consumers. We are looking at riding this wave of growth that is going to come from value commerce.”
She noted that whenever you think of India, there is the top small percentage, and then there is the belly of Bharat, which is really what is growing. It is the scale of this belly of Bharat that comes into the category, driving the growth of the value commerce category, she explained.
“If you look at the ecommerce size, it is supposed to be around 300 million people now, who are growing every month. They are supposed to reach over 500 million by 2029-30. The next 200 million is what really the real growth for ecommerce is,” she noted.
She explained that ecommerce in itself is supposed to grow from around Rs 4,400 billion to around Rs 7,600 billion, so another Rs 2,000 billion is supposed to come, a significant chunk of which is likely to come from these additional 200 million.
Parameters Of Success
Noting that she looks at success on three parameters, Agarwal added that the first and foremost is how much consumer love or consumer traction one has. Gross Merchandise Value (GMV), orders are an outcome of how consumers are liking the whole process.
“The second is the brand strength. That is a reflection that if the consumers like you, they will purchase from you, and they will be brand loyal to you. So these are the parameters on which we look at success for Shopsy. That is from the outcome side of it,” she explained.
From an input side of it, she said that success is when one is able to provide the right selection at the right value and right quality for consumers. She added that the goal is to make ecommerce affordable and accessible to this consumer, who is not an ecommerce native, who does not understand English and is not very tech-savvy.
Debate On Online Vs Offline Shopping
While the growth of ecommerce has been beneficial for players that operate in this ecosystem, concerns have been raised by brick-and-mortar shops who allege that online commerce has eaten their share and has been impacting their trade on a large scale. On this, Agarwal explained that when it comes to India, it is always about ‘and’, not ‘this or that’.
“I have been in previous sectors also, and there is one very nuanced truth that in India, it is never this or that. We are always about ‘and’. There are occasions when consumers go offline, and they are comfortable with that. There are occasions for which they come online, and they get access online. It is very symbiotic, and there is space for both,” she commented.
With a growing population which is becoming economically better every year, the share of the pie is increasing. It is a minimalist way of thinking to say that there is only this much pie and they eat into each other, she explained, while noting that both modes of shopping grow together.
What Lies Ahead For Hypervalue Industry?
Emphasising that if there is one thing that is very unique about the belly of Bharat, it is the fact that we have a very different culture every 100 metre. Our food, choices are different. “The heterogeneity of choices and selection is what we call, at Shopsy, multiple Bharat selections. And that is going to grow in a very big way,” she noted.
“The second aspect is the entire product experience, which is going to be very different. This consumer is not very English-savvy. Voice-based, video-based, and image-based ecommerce will become very big. It is already big in places outside of India where live commerce is big and video commerce is big,” she explained.
Noting that Shopsy serves around 19,000 pin codes today and goes to the tier three towns, she added that the third big driver of growth will be the ability to reach every nook. “We are working on a model where we will be the first to reach many remote locations,” she said, while adding that the goal is to make accessibility not just about the selection, but also about being able to reach the remotest locations.
