The $ 5.7 billion Jio-Facebook deal has brought two major players with huge ambitions in the digital commerce and digital payments together, offering them an opportunity to tap the highly dispersed retail business in India.
In fact, Jio Platforms, Reliance Retail Limited and WhatsApp have entered into a commercial partnership agreement.
This has been done to further accelerate Reliance Retail’s new commerce business on the JioMart platform using Facebook-owned WhatsApp and to support small businesses on the messenger, which already plays an important role in helping people and businesses connect in India, said Reliance Industries Limited in a statement released on April 22.
“The target will be meeting all sorts of consumer requirements, imagine your social network connections integrated with your mobile phone connection, which can be leveraged for all forms of purchases,” said a top industry consultant on the condition of anonymity.
Facebook has been leveraging its instant messaging property WhatsApp for payments and business transactions.
Also read | Here's why Facebook bought stake in Reliance Jio for Rs 43,574 crore
The partnership will allow consumers to place orders through Facebook and WhatsApp. The orders will get fulfilled by Jio’s network of small kiranas and wholesale businesses. Further discovery can also be solved by this partnership, where nearest kiranas can be marked out on the maps, orders placed online and products delivered home.
Even on the small business side, Reliance can bring in its wholesale to retail connections and WhatsApp can leverage its reach. Now, the only need is to navigate the myriad business challenges and finally get it to be executed at a pan India level, the consultant said.
“Our focus will be India’s 60 million micro, small and medium businesses, 120 million farmers, 30 million small merchants and millions of small and medium enterprises in the informal sector,” said Jio in a note shared with the press.
The Jio Mart and WhatsApp partnership will pose fresh challenges to the existing players. Many payment companies such as Mswipe were trying to connect their retail merchants onto a wholesale backend through applications built into their PoS terminals.
Merchants could use the same app to place orders with wholesalers, accept payments from consumers and also manage their accounts and stocks. Players like PhonePe were showing their consumers nearest roadside kiranas and small stores by marking them out on the map and also showcasing offers, discounts and availability of products.
Several players were trying to build pieces of an online-to-offline strategy keeping in mind the small business network in the country but with this deal, Jio and Facebook can finally implement that at a pan-India level.
Facebook, on April 22, announced an investment of $5.7 billion (Rs 43,574 crore) for acquiring a minority stake in Jio Platforms Ltd as it looked to expand presence in its largest market in terms of subscriber base.
Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd
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