With the growing acceptance for e-commerce in India, the Tatas too have joined the online space. Infiniti Retail a subsidiary of Tata Sons which runs the multi-brand electronics stores Croma have ventured into the e-commerce field by launching CromaRetail.com. Croma is backing this initiative with service centres in Delhi, Bangalore and Mumbai.
Elaborating about the launch of online portal, Ajit Joshi, Chief Executive Officer, Infiniti Retail, said, “With e-commerce we expect to cover 319 cities and 24 states with nearly 6,000 pin codes across the country. We expect e-commerce to generate similar revenues to our brick and mortar business in the next two years.The online store and the physical retail store chain would be two separate entities and will have individual strategies in terms of deals available and will compete with each other.”
However in spite of its e-commerce foray, Croma will continue to add more stores across the country. It has 73 stores and expects to add 14 new stores this year.
Croma also has exclusive partnerships with brands such as Intel mobile phones whereby the product will get sold only at the Croma stores.
Infiniti has tied up with global logistic firms like Fedex, Blue Dart, India Post and Tata Group firm Diesel.
Explaining the business model, Joshi said, “The USP of our business is the Tata brand. Therefore, unlike other portals, we will not have to offer any discounts. Also, we will not offer cash-on-delivery.”
Having been funded by Tata Sons, Infinity Retail might look at other sources of funding in the future. “We have been funded by Tata Sons all these years with an investment of Rs 480 crore. The future expansions and entry into e-commerce will also get funded by Tata Sons. But the next phase of investments may not be done through Tata Sons. We have not looked at private equity as yet,” added Mr Joshi.
According to a report by industry body Assocham, online retail segment is likely to be worth Rs 7,000 crore by 2015 due to rising broadband availability and increasing Internet penetration, from Rs 2,000 crore at present. It is growing at an annual rate of 35 percent.
April 22, 2013, 5:55 am UTC
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