Online retailing paired with kirana—a formidable combination for emerging markets

Abstract

In the light of the convenience provided by online and the omnipresent kirana (mom-and-pop equivalent) stores and low penetration of large format retailing, it is proposed that these two would be the dominant formats of retailing in the emerging economies. Four major factors have fuelled the growth of electronic commerce in emerging economies. First and foremost is the rapid penetration of technology, be it the broadband or the smart phones. Second is the fast adoption of the online medium by every major brand as a part of their sales as well as the marketing strategy. Large retailers have also opened stores in the virtual space. The third factor is the convenience and choices consumers derive through online shopping that adds value to time- and effort-strapped customers. This is further facilitated by services like cash-on-delivery, buy-back policies and many more. Finally, the increased real estate prices, higher operational costs and non-availability of good retail spaces have restricted the growth of larger physical stores.