Flipkart’s 2GUD guarantees refurbished merchandise at ‘nice costs’; execution key to tapping cost-conscious customers, say consultants
The refurbished items market in India can be price an estimated $20 billion within the subsequent 5 to 6 years.
Smartphones, the preferred product within the refurbished class, noticed volumes develop by near 25 p.c in 2017. It crossed 12 million models in India, in accordance with Counterpoint analysis’s report – Expertise Market Analysis.
The worldwide marketplace for refurbished smartphones grew 13 p.c year-on-year in 2017, reaching near 140 million models. By comparability, the worldwide new smartphone market grew a scant three p.c final yr, thus being outpaced by refurbished ‘second-life’ smartphones, in accordance with the most recent knowledge from Counterpoint’s Refurbished Smartphone Tracker.
India’s refurbished items market homes some established and well-known names like Shopclues, OLX, Quikr, amongst a bunch of others. Apart from, with social media gaining a lot foreign money, a number of Fb and WhatsApp teams too act as a channel for these excited by promoting or shopping for refurbished items. It’s on this rising market that Flipkart has rolled out its platform for refurbished items — 2GUD.
“We’ll maintain evolving and bringing newer codecs, classes and options which cater to the wants of our value-conscious center India,” Flipkart CEO Kalyan Krishnamurthy mentioned, including that each one eBay.in sellers and prospects can be migrated to the brand new platform.
“The brand new platform has a special worth proposition in comparison with Flipkart, and can cater to a special audience. We’re dedicated to investing on this impartial model,” he identified.
However will Flipkart be capable of cash-in on its model identify and succeed?
There are early movers on this house. Assume Quikr, OLX, GreenDust, Reboot, Togofogo, Overcart, Shopclues and Amazon.
In keeping with a survey by Quikr, individuals who favor pre-owned items are chasing higher pricing, simple availability, doorstep service and a short-term requirement. The bulk of people that lean in direction of this section are within the 20-29 age group and about 54 p.c of these polled mentioned they like refurbished items for higher pricing and straightforward availability of merchandise.
Amazon guarantees quick delivery
Amazon which rolled out its ‘Amazon Renewed’ programme final yr, has discovered buyer demand throughout classes together with smartphones, laptops, headphones, watches, small home equipment and Kindle e-readers to call just a few.
Vivek Somareddy, Director- Vendor Providers at Amazon informed Firstpost, the refurbished items class is rising 300 p.c y-o-y with over 70 p.c of all orders coming from cities like Kanchipuram, Secunderabad and Surat to call just a few. This class has grow to be a ‘go to vacation spot’ for Indian prospects who aspire to purchase prime quality aspirational merchandise at extra reasonably priced costs, he mentioned.
“Licensed refurbished merchandise are labored upon by the unique producers or skilled refurbishers in adherence to our product high quality coverage. Clients buying merchandise via Amazon Renewed get prime quality, like-new merchandise at a aggressive value – in reality, they will save as much as 50 p.c whereas buying a refurbished product vs the acquisition of a brand new product,” Somareddy added.
Amazon, nevertheless, has a strict coverage. “We now have a really strict coverage concerning high quality and underneath this program, solely chosen sellers who keep a top quality and efficiency bar are allowed to supply licensed refurbished merchandise on Amazon.in.
“The refurbishment course of for this class usually features a full diagnostic take a look at carried out via trade customary purposes, substitute of any faulty or broken components, an intensive cleansing and knowledge wiping course of, and eventually the repackaging in a brand-new field. The merchandise include a minimal of six months guarantee supplied by the model or the vendor of the product and can be found without cost and quick delivery with Amazon’s Fulfilled by Amazon (FBA) delivery service.”
Re-New eyes 16 million prospects
ShopClues runs Re-New Devices for refurbished items. Re-New clocked Rs 4.5 crore in gross sales from refurbished and unboxed digital units alone, together with laptops, smartphones, and tablets, for the month of July. It’s seeking to double GMV progress with a 16 million buyer goal in 2018.
“ShopClues had lengthy recognized the huge alternative across the refurbished class; specifically the renewed smartphones section, which in accordance with trade estimates, is ready to develop by over 27 p.c in 2019. We now have virtually doubled our buyer base from eight million to 16 million inside two years and our success has given us confidence to supply greater than 400 inventory promoting models from totally different manufacturers within the smartphone class.
“Additionally, quickly ShopClues can be launching a full assortment of laptops and TVs from HP, Dell, Apple, Asus, Lenovo, LG, Sony and Samsung for its prospects,” mentioned Radhika Aggarwal, co-founder & Chief Enterprise Officer, ShopClues.com
There’s a want for extra gamers within the refurbished items market in India, as there’s a marketplace for used merchandise that may be recycled and upcycled, mentioned Devangshu Dutta, Founder-Chief Government, Third Eyesight.
When individuals transfer cities, international locations, there are a variety of merchandise which might be used for a short while and haven’t lived their full life-cycle, and refurbished items gamers come to their support. Nevertheless, he mentioned, it’s all about peer-to-peer belief.
“If the platform stands by some type of a assure, it’s going to enhance that transaction and enhance the variety of transactions. Else, it doesn’t matter who’s doing it. Simply because Flipkart is a recognized identify, it gained’t discover it simple navigating this house,” Dutta added.
The Flipkart benefit
The post-purchase guarantee of three to 12 months for every product could be serviced via an in depth community of service centres throughout India, mentioned Flipkart’s Krishnamurthy. “Moreover, customers will at all times be assured of comfort in funds and logistics,” he added.
Flipkart’s new transfer towards refurbished items is an efficient experiment on its half, mentioned sector specialists. Indian customers wish to personal good merchandise however numerous them have low buying energy. Past the pre-owned two-wheeler and four-wheeler market, there aren’t many platforms which cater to this want. At greatest, single model gamers stay an alternate platform, they mentioned.
However the problem for Flipkart is to make sure high quality. “Clients need items to carry out and can want after-sales providers, as unique gear producers will not be capable of present warranties with the product out of the guarantee interval. And with merchandise being refurbished, no producer can present ensures. Flipkart has the benefit, with expertise and logistics. 2GUD is an efficient alternative however execution would be the key [to the platform’s success],” mentioned Arvind Ok Singhal, CMD, Technopak.