• Source:JND
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Jagran New Media, the digital wing of Jagran Prakashan Ltd, and the Open Network For Digital Commerce (ONDC) Network launched  Khojle.com, a one-stop marketplace that will transform the e-commerce landscape. This strategic move marks the first time that ONDC has joined forces with a leading Indian publisher to provide a unified user experience.

In a discussion, Bharat Gupta, CEO of Jagran New Media, T Koshy, MD & CEO, of ONDC and Lloyd Mathias, an Angel Investor and Business Strategist, expressed their views on India's potential in the e-commerce sector. The business leaders discussed about how digital evolution is bringing change in the nation and how the collaboration between big publications like Jagran and e-commerce platform ONDC will help small and medium-sized businesses.

Talking about how India has built a robust digital infrastructure over the decades, Lloyd Mathias said, "If you look back at the last couple of decades I think what India has done in terms of digital public infrastructure has been remarkable. I think we've seen the efficacy all across, primarily, I think UPI has opened up the world. Today you can tip someone via UPI or you can pay at the parking lot for Rs 20 and can also make large transactions. Truly as Indians we can be proud of what we've achieved in terms of digital public infrastructure. I think that's been one of the remarkable reasons for growth but while we've celebrated the growth of digital public infrastructure while we've seen the whole startup boom while our stock markets are looking good, I think the one area where we haven't reached the full potential is e-commerce. Right, I think 2016 was a big inflection point when Jio came in. India's data prices are possibly among the cheapest in the world and that has taken smartphone penetration up to about 700 billion."

"At some level, penetration of digital infrastructure is close to a billion mark but I think e-commerce is still restricted to a small sliver of the population at the upper end and what NPCI did to digital payments, I believe, that one truly can make in terms of building e-commerce,” he added.

ONDC's Focus Areas

Lloyd Mathias goes on to ask ONDC CEO T Koshy about the company's focus areas in the coming years. "Less than 1 per cent of India's sellers participate in e-commerce today and under about 5 per cent of people are buyers of e-commerce. I think the real magic is looking when this number doubles or hopefully trebles shortly and that's when you know India sort of leads the way. So, what are the big milestones to look at for the next two or three years and what are the big focus areas?" asked Mathias.

Elaborating on ONDC's aim, Koshy responded saying, "First and foremost, we need to build a network that is proving that it can deliver. How do you prove that it can deliver? It should have buyers and sellers who are doing a certain reasonable amount of transactions that give a lot of confidence. Further, there should be participation from big and small players. So, till last January, when we made this network available to the public in Bangalore, we had been experimenting for the previous six months. We had 500 merchants and we did a total of 1,200 transactions in that month in that area. Now, in March, we did 7.6 million transactions with nearly 4.5 lakh merchants. More than half of those merchants are small taxi drivers and auto drivers. We have McDonald's, Domino's, we have farmer producer organisations (FPOs), we have a large number of artisans, and all of them equally being present, demonstrating it as possible."

We have about 65 per cent of nonmobility transactions happening from tier 2, tier 3 cities, but these are all tips, so what we are expecting is that we will contribute to the expansion of this market. Today's market is concentrated with a few large players. If I am in the position, I'll do the same thing to milk the premier sellers and the buyers. Whereas ONDC is creating a utility, a public good, on which the big and small should equally prosper," said the ONDC founder.

"We are going to work with the farmer producer organisations and artisans of the world to give them a helping hand, not just by ourselves, but with the help of the MSME Ministry, Ministry of Agriculture, Ministry of Fisheries, and even philanthropic capital like the Gates Foundation on one side, and the other side all of them doing some affirmative action to for capacity building," said the MD and CEO of ONDC.

Jagran New Media's Role in E-commerce Growth

Addressing Jagran New Media CEO Bharat Gupta, Lloyd Mathias went on to say, "Not only will ONDC make e-commerce truly democratic, it could also be a kind of fresh protocol that hopefully the rest of the world can emulate. I think what we said was that India is truly a world leader in terms of using population-scale technology to disrupt the market and I think if you look back again at the last decade or so I think while we've achieved great strikes, startups are booming, the whole PLI is getting the elements of bringing global man falling into the country. I think the one segment that surely needs attention is the small and specifically the micro and small medium Enterprises. We're talking about a humongous number of 6.3 crore MSMEs in the country, which account for almost a third of our GDP. The small seller has not been able to easily move on to e-commerce and maybe the few big players are, as Koshy rightly pointed out, looking to milk the cream.

"How do you see a group (Jagran New Media) like yours which fundamentally is among the largest newspapers in the country with deep penetration to smaller markets specifically in the Hindi heartland be able to kind of accelerate this process right?" Mathias asked Gupta.

The JNM CEO replied, "I would first begin with the vision statement of the organisation which is to produce factual and credible content that empowers new India through knowledge, information, and point of view towards an inclusive and progressive society. This is our founding pillar for everything that we do and as you said just 1 per cent of sellers are selling online in terms of e-retailing and contributing to 35 per cent of GDP by MSMEs. I think there's a big gap and if India has to reach the USD 5.2 trillion target, the small and medium enterprises need to perform. As a media organisation we see a great role in providing these MSMEs with literacy around the changing landscape and today digital is a great reality."

"I think during the pandemic the penetration of internet just skyrocketed and it woke every organisation from top to bottom to the new reality of digital and how it is going to disrupt our worlds. Commerce always follows where the audiences are, and in this case, within the Internet, it is the mobile. So while the access is there, the audiences in the first phase are consuming content, but the seller activity has not transformed or initiated or scaled to that degree yet," said the Jagran New Media CEO.

Gupta further spoke about JNM's role in accelarating growth, saying, "So what we want to achieve through this exercise is that there is a use case, where we feel that we can use the collective strength of a group by way of print and digital to mobilise the 60 million print readers and the 100 million digital audiences to understand and connect with this e-commerce network. And as a subset of that, can we use our network to empower and enable these MSMEs? To understand this digital disruption, we must understand that like any evolving industry, the top layer of MSMEs has already adopted this medium and less than 70 per cent of the MSMEs have a website, or have access to the Internet or 50 per cent have access to a website. So, now we need to disrupt this. So, what we want to do is use our channel offices to provide these MSMEs with the literacy of the changing landscape and then advocate the usage of a platform like ONDC which can make their lives easier,” said Bharat Gupta.

"And it would also help our audiences to connect with local availability of products that are required in their daily life, at the press of a button. I think, what we also bring into the equation is that instead of a very pure play transactional relationship where someone just discovers a product and buys and gets out, we want to build a deeper relationship by utilising content to commerce and starting with different narratives like an insurance as a category, or food as a category, or ranging services from essential to daily services to commute. So, the possibilities are endless. But is there a way to do it in a different way, that we are writing a narrative which leads to a necessary transaction around a service." said Gupta.

"In terms of the landscape, the way things are changing, pure play advertising is also going to be very very challenging. So, this also gives us and opportunity to experiment with a more evolved way of entering or diversifying your revenue streams and also diversifying your content presence," Bharat added.

Democratisation Of E-Commerce

Mathias next addressed Koshy, saying, "Given that ONDC is a protocol and you're going to enable the true democratisation of e-commerce to take it down to the masses. Unlike the existing platforms, like you rightly said are kind of looking to milk the cream, do you foresee tie-ups like this really helping you get to the interiors and are you also therefore as you partner with Bharat’s group looking at clear targets. What is the kind of depth of penetration that ONDC gets into. How will this partnership of ONDC with the Jagan New Media Group help achieve the depth penetration?

Koshy responds, "As I explained to you, the current platform-centering model ensures that in every domain, there are only one or two players, or at most, three players. The way these players will evolve the market is based on how to maximize their shareholders' investment. They are not focused on nation-building; while they contribute to it, their primary focus is on shareholders. That is why we believe that companies like Jagran Group will help us achieve this larger objective."

"With their buying platform and Jagran’s deep reach in the Hindi heartland, they know that they will be able to curate content to meet their audience, which is not just the 7 per cehnt of the elite but the majority of India. They have all the incentive to curate content for the same kind of people who are reading their newspaper. Everybody reads their newspaper, and they understand the pulse of their customers. They can present to them in the most meaningful fashion. When they do that, they not only help them to buy but also become a huge influencer of who is going to sell. They can reach across to a large part of their audience, who are also sellers. So, until now, the only option for sellers in digital commerce was to have a huge physical location and pay very high percentage charges for the digital. Now, I am bringing you the digital market. You can be present here. If you have doubts, I'll help you. I will help you to learn. That's where content can also contribute to capacity building and awareness building. This also gives them confidence. It's not just preaching; it's also practice of giving them the market. For every businessman, any investment is based on a single question: will I be able to access a profitable market and will I get money out of selling something? He's saying that I'm going to help you do that. So, it gives them a lot of confidence to enhance their participation. It's not just giving some tools or digitization or some advertising; the hardcore is there. That's why I'm very optimistic and excited that we have been talking a lot; now somebody is coming to action. Fantastic," Koshy.

Enabling More Sellers to Join ONDC

Mathias next asks Gupta, "What are the steps that your group will take to enable more sellers to join the ONDC platform?"

"To organise a series of evangelisation programs across the core Hindi Heartland, where we gather these MSMEs, some retailers, and team members from ONDC, and we conduct these small modules of literacy or awareness programs on how they can become e-commerce sellers. As you have already explained in the first step, the importance of e-retailing, the follow-up comes through the advocacy part. Positioning ONDC, and then the contribution from our side in the end would be solution-building. So, as Mr. Koshy said, it's not just about giving a platform but also helping them or holding hands. What are the elements that you require to come online and sell online? Technology, solved. Next, a content narrative adds content to commerce. We are there to handle digital marketing, so we have the audiences on our platform on the physical platform. In terms of integration, we'll start using QR codes and a user can easily scan that QR code, arrive at the basket, and enable that transaction,” said Bharat.

"Close to 60 per cent of e-commerce transactions are happening through tier 2 and tier 3 towns, so that gives us confidence. I would say our user side is ready but on the seller side, which is the 1 per cent bucket, I think initiatives like content to commerce or solution building, making creatives would aid that transformation," Bharat added.

Mathias next asked Koshy: "Is it about FY 24-25, is this going to be the year when e-commerce explodes? Shall we say that a little 1 per cent seller and a 5 per cent buyer market could be the beginning of the true democratization of e-commerce? And you've got a media tie-up with a very large player."

“I would say, last year is when we demonstrated it is workable and it can also be adaptable for multiple segments like I said earlier. We started from two or three segments, now there are 13 or 14 segments, and we have reached 7 and a half million transactions this year. We would see several more players like this taking very strong leads because each of them needs some amount of time. So, multiple domains, multiple people to jump in but will they get all that is possible? No, because they need to reach across... because Abra gabra happens only in children's comic books. I mean, our Outreach being enhanced and so on, and that will show, like you said, the early sparks, and I'm hoping that from 7 and a half million, it may go to next year and maybe 50 million in a month, but that will give the confidence to explore it take it forward. We will demonstrate confidently that for all of them, this is the way to go then it early risers will get the benefits.

Future Outlook and Collaboration Goals

Mathias directs his next question to Bharat: "What is your kind of wish list or two or three key objectives that you see for this big collaboration between Jagran New Media and ONDC and what are the big three wins that you expect?"

"So first, of course, customer engagement, and I think increasingly for any digital company, the biggest challenge is how do you retain your customers and if we can, as a company, increase the value proposition of audience engagement, then I think that's a big number one for us especially in the short attention span. The Millennials and Below which is I think now a reality, second, I would say monetization and, if you look at the Indian advertising space about 80,000 crores is digital now, the largest advertising segment, and the traditional medium like television is now, I think if I'm not mistaken, is 60,000 crore or so and print would be going down,” said the Jagran New Media CEO.

"What is also important to understand is that within the 80,000 crores, roughly about 50,000 is attributed to digital advertising and of that 50,000 only 2,000 crores is coming to digital publishers. So, the entire value proposition has shifted to Performance advertising and stuff like what we just talking about, so I think as a company, it is important for us to rebuild our capabilities to create a space in this."