 "'Deep discounting by e-tailers to fall'")
India's venture capital-backed e-commerce firms would increasingly reduce offering massive discounts to get more users, instead would focus on building a viable business, said Nikesh Arora, president and chief operating officer (CEO) of SoftBank Corp.
"I do think money will get on providing trials to the consumers and acquiring quality customers, as right customer acquisition is a bit too indiscriminate," Arora said at an interaction said at the launch of The Print, a media entity co-founded by journalists Shekhar Gupta and Barkha Dutt. He added in the past three years, out of 540 e-commerce companies, which came up in India, about 10 have managed to survive.
"There are more people in India who would like free money than there is money in the world. So, at some point, companies would stop giving free money, so, discounting would stop. There is a huge gold rush right now where there is a belief that e-commerce is a winner takes all market. They believe if they can just outlast the competition and survive, then they would be able to make money," Arora said.
"In ten years from now it is probable that a $100-150 billion dollars of commerce would be conducted by going online and that would be larger than any brick and mortar retail in India. That is the shape of commerce in India future," he said.
On Prime Minister Narendra Modi's 'Make In India' policy, Arora indicated that the government needs to make efforts on ease of doing business. He also said that the upcoming 'Startup India' policy should make it easier for startups who are not doing well to wind down, as at present closing down the companies in India is a long drawn process.
"Startup has a notion of iterate, fail and start again but in India that is not possible. Here the process of closing down a company is more cumbersome than starting a company. The part of the request has been to make such processes for entrepreneurs easier so that they concentrate on making a great business. The message has been heard and hopefully we will hear more about it in the policy," he said.
On 'Make in India' Arora added that there is a need to incentivize so that people manufacture in India
"I do think money will get on providing trials to the consumers and acquiring quality customers, as right customer acquisition is a bit too indiscriminate," Arora said at an interaction said at the launch of The Print, a media entity co-founded by journalists Shekhar Gupta and Barkha Dutt. He added in the past three years, out of 540 e-commerce companies, which came up in India, about 10 have managed to survive.
"There are more people in India who would like free money than there is money in the world. So, at some point, companies would stop giving free money, so, discounting would stop. There is a huge gold rush right now where there is a belief that e-commerce is a winner takes all market. They believe if they can just outlast the competition and survive, then they would be able to make money," Arora said.
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Founder and CEO of OYO Rooms Ritesh Agarwal; Congress leaders Manish Tewari and Deepender Hooda; and Chairman of Hero MotoCorp Pawan Munjal were present at the event, along with other business leaders and senior journalists. SoftBank, at present, has invested in around 17 different companies in India, including the e-commerce majors Snapdeal, Oyo Rooms and Ola cabs.
"In ten years from now it is probable that a $100-150 billion dollars of commerce would be conducted by going online and that would be larger than any brick and mortar retail in India. That is the shape of commerce in India future," he said.
On Prime Minister Narendra Modi's 'Make In India' policy, Arora indicated that the government needs to make efforts on ease of doing business. He also said that the upcoming 'Startup India' policy should make it easier for startups who are not doing well to wind down, as at present closing down the companies in India is a long drawn process.
"Startup has a notion of iterate, fail and start again but in India that is not possible. Here the process of closing down a company is more cumbersome than starting a company. The part of the request has been to make such processes for entrepreneurs easier so that they concentrate on making a great business. The message has been heard and hopefully we will hear more about it in the policy," he said.
On 'Make in India' Arora added that there is a need to incentivize so that people manufacture in India