ShopX To Introduce Voice Assistance As It Eyes Bigger Chunk of E-Retail
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ShopX, an e-commerce start-up that connects small Indian retailers to both suppliers and customers, aims to bring voice-assisted navigation on its mobile application, as it attempts to dive deeper into what it thinks is a $100 billion space.
“The app is going to talk to you in your regional language and guide you about what to do next,” said Amit Sharma, co-founder and chief executive officer at ShopX.
In an interview with Entrepreneur India, Sharma talked about the need to build products that could be used by everyone, especially those who are often not taken into account by the big e-retailers as their target audience.
“E-commerce in India is not ‘everyone’ commerce. And in many ways, it is elitist commerce, it works for some people. But for most other people, there are significant barriers, which prevents them from participating in the modern economy,” he said.
Bengaluru-based ShopX claims it currently works with 150,000 retailers across the country.
While the total value of transactions on the platform is slated to breach the billion dollar mark this year, Sharma said they expected the number to grow manifold to $20 billion annually in the next five to six years.
“Technology Is For Everyone”
For ShopX, the idea is to make tech-based commerce easier for people, in turn, quashing the belief that those in smaller towns would not use technology if given a chance.
When designing tech for people outside of metropolitan cities, one cannot apply their learning from developed markets such as the US and Europe, according to Sharma. It must be designed keeping this very different audience in mind.
“One of our learnings has been that if you design it well, really care about the details and pay attention to detail in your product and technology design, then everybody can use technology,” he said.
Retailers who have signed up on the ShopX platform use the mobile application 20 times per month on average.
The platform can currently be used in four different Indian languages, with more in the pipeline. “One of the early lessons we had is that most of India is not comfortable buying (when information is) in English,” Sharma explained.
Apart from language localization, the company has also focused on the wildly varying consumption patterns in any Indian city, claiming that these patterns sometimes change within as little as 100 meters.
“How do you build a retail model in such a reality?” asked Sharma.
The company’s in-house tech allows it to show different offerings of products sitting in the same city but in different localities; sometimes even across streets.
Leveraging Tech To Find Solutions
The focus on voice assistance comes from two ideas, said Sharma.
“A lot of people in India are increasingly using voice to interact with systems,” he said, explaining how voice adds to the convenience of the customer.
However, the strata that this feature would really help is the one that doesn’t know how to read and write, according to Sharma. “The comfort with reading and writing is low for a lot of people... I think that for the masses, voice is just a far more intuitive way to interact.”
Voice-assisted navigation aside, the company possesses tech that pulls out multiple data points from a photograph.
“Using a single picture, you know the exact location of the store, you have digital coordinates, you know how big the store is, you know what stock keeping units he carries, what is his classification and many other things,” Sharma said. ShopX uses this data for smarter profiling.
Nearly all of the company’s tech is built in-house.
“That's why the largest team in ShopX is product engineering...about 30 per cent of our workforce is in product engineering, AI (artificial intelligence), ML (machine learning), data analytics,” he added.
Profitability Not Elusive
At a time when there have been calls across the world for start-ups wildly chasing rapid growth in topline numbers and burning cash without any regard for profitability, ShopX says it is different.
Sharma claims ShopX is already profitable when one considers gross margins without taking into account freight costs. “Even at a completely fully loaded variable cost basis, we are almost close to profitability.”
This was one of the key challenges the company faced: balancing scale with fundamentals. But Sharma believes they have done well in that regard.
Infosys co-founder Nandan Nilekani was one of the early backers of the start-up and Sharma believes that has also helped in inculcating principles that help them find a balance.
While there are several dimensions to its expansion plans including geographical and network expansion, an interesting new feature ShopX is exploring is digitization of credit for both B2B (business to business) and B2C (business to consumer).
“Our research shows that 60 per cent of our Kirana (local retail) stores offer some credit to their consumers,” said Sharma.
“You can use the same ShopX platform and provide a multitude of benefits to a retailer. And that's really what we're driving,” he added.
According to him, the platform was built with a global design in mind and since the void they are filling is not limited to India alone, expanding abroad is certainly on the cards. “It's too early; there's a lot of work to be done in India but we are looking at markets like Indonesia for some initial pilots maybe next year,” he said.