India is the second biggest smartphone market in the world, and Samsung wants to go big in the country. However, there’s a price difference between online and offline retailers which leads to confusion among consumers. Also, offline retailers have started to lose business as they can’t offer prices as low as some online retailers like Amazon and Flipkart. To solve this problem, Samsung is planning to go hyperlocal.
According to a report by The Economic Times, “Samsung is localising e-commerce order delivery, installation and even collection of payment for cash-on-delivery orders through authorised distributors and dealers who will be market specific.” The South Korean electronics giant currently sells its products in India through WS Retail on Flipkart and Cloudtail through Amazon, but after a recent regulatory change Samsung has to change its system.
As per the new regulation put forward by the Indian government, no single vendor can contribute to more than 25 percent of the sales on an e-commerce marketplace. Samsung can have more control over online sales of its products by letting its own dealers handle sales and deliveries. The company is now working with Amazon, Flipkart, and Snapdeal to list its local (offline) sellers on the e-commerce platforms. Online orders will then be redirected to the closest brand store based on the pin code.
This move by Samsung seems interesting, but it remains to be seen how the company manages to serve after sales service. Rahul Saigal, MD at digital marketing consultancy Netimpact Solutions, said, “While there may be potential advantages for consumers such as installation, but the real test will be in service delivery and post-delivery issues for which the e-commerce sellers have already built their name.”
Samsung launched certain devices including the Gear S2, the Gear VR, and the Galaxy On series of smartphones exclusively through e-retailers, and the decision might have annoyed regular brick-and-mortar store owners. It will be interesting to see how Samsung manages to satisfy customers, online retailers, and offline retailers in the coming months with its new plan.