I would like all C-Suite Executives, be they from Startups, SMEs or Big Corporations, to repeat this “Mantra” every day right after they wake up.
Domestic Growth Is Not Enough For My Business
Exports To Developed Economies Is Not Enough For My Business
Growth For My Business Should Increasingly Come From Sales In Emerging Economies
The last part, especially, will not magically happen. They will need to understand the market and create or co-create solutions that B2B and B2C customers in those emerging markets will buy. There is definitely space for high cost solutions but more often than not the solutions that are needed are those that have these Frugal Innovation attributes: quality, sustainable, accessible and affordable.
So, if you haven’t heard of Nokia’s OZO camera, here is a brief overview.
Ozo is touted as the world’s first professional Virtual Reality camera. As you can see from the image it can capture 360° spherical video at 30 FPS and 360×360 surround sound via it’s 8 2K cameras.
Nokia just announced that they are now selling Ozo in the Chinese market and with that press release they also announced new global pricing of $45K USD (€40K Euros). This is down from $60K that it was priced so far.
So Nokia is entering the Chinese market with a new global pricing that is 25% reduced from it’s original pricing
If we checkout Google’s VR page, it shows how it wants to be in the commercial as well as the consumer sector and with collaorations with IMAX, Jump, and Go Pro; Google has the deep pockets and the knowledge base to become a competitors to Noika’s Ozo.
Both Google-Gopro Jump and Nokia Ozo seem to be aimed at the professionals but at the same time there are also good, affordable alternatives aimed at the consumer market, eg: Vuze VR. Going on sale at $799, it puts VR in the hands of budding professionals who can’t afford the expensive Gopros and Ozos but also for families who want to record their own activites.
Source: Vuze VR
Albeit $799 might be still costsly for VR to take off in the consumer market but these are really early stages, and I can imaging a sub $500 VR camera rig in a year or two.
Few final thoughts:
Nokia realizes that for faster adoption to occur globally, it needs to reduce it’s original price
Entering and selling in China and eventually in other emerging markets also has pushed Ozo to be offered at a 25% lower price
There will be competitors from USA, China and maybe India who will start to offer a frugal alternative just like it happened in the smartphone arena and Nokia wants to be in the drivers seat with it’s own offerings.
Just read a great article on how Amazon is growing faster and outcompeting local e-commerce giants in India by Vijay Govindarajan and Anita Warren in Harvard Business Review titled How Amazon Adapted Its Business Model to India
So these are 3 big guns in the e-commerce sector in India in 2016:
Amazon
Amazon India
Flipkart
Flipkart
Snapdeal
snapdeal
As Vijay Govindarajan and Anita Warren point out, Amazon did not come into India and succeed by doing what helped it make the giant it is in USA.
When Amazon decided to enter the Indian e-commerce market, it was clear from the outset that something would have to give. That something was the very business model that had made Amazon an internet powerhouse in the U.S.
Especially Amazon being a foreign entity it had to play under different rules. Now the advantages and disadvantages that Amazon faced in India are highlighted as follows:
The good news: included a very young populace — more than 65% under age 35 — rising levels of disposable income, and ubiquitous cell phone ownership (80% of the population, by one estimate).
The bad news: 67% of the population lives in rural areas characterized by an underdeveloped infrastructure. Only about 35% of India’s population is connected to the internet. Cash, not credit cards or checking accounts, is still the rule. And, determined to protect its own, India enacted a rigid FDI policy restricting foreign multibrand retailers from selling directly to consumers online. That meant any venture would basically be a third-party seller for Indian-made products.
After launching India in 2013, Amazon India went about implementing it’s roadmap by doing the following things:
Educated the small-business owners using “Amazon Chai Cart” where it took it’s marketing people to the door steps of the small business owners to make them a part of it’s platform
Created “Amazon Tatkal“- a self-described “studio on wheels” that provides a suite of launch services, such as registration, imaging, cataloging, and sales training.
In U.S.A, Amazon uses a centralized shipping platform, which it calls “Fulfillment by Amazon (FBA)“, to store and distribute the products it sells. Sellers send their goods to Amazon’s fulfillment centers and pay a fee for the corporation to store, pick, pack, and ship their wares. They implemented the same in India as well.
Created “Easy Ship” whereby Amazon couriers pick up packaged goods from a seller’s place of business and deliver them to consumers.
Created “Seller Flex” whereby vendors designate a section of their own warehouses for products to be sold on Amazon.in, and Amazon coordinates the delivery logistics helping speeding up delivery.
Inked contracts with a number of major delivery services in the country, including India Post and cargo airline Blue Dart. Using bike and car couriers where needed. In 2015, they also set up a subsidiary, “Amazon Transportation Services Private Limited“, to augment delivery.
By making the small business owners especially in rural India as it’s partners, Amazon helps locals with no internet access go to the local store and use the owner’s internet connection to browse and select goods from Amazon.in. Then the store owners record their orders, alert customers when their products are delivered to the store, collect the cash payment, and pass along the money — minus a handling fee — to Amazon.
Of course these are still early years and no one is yet an outright winner or loser and India is big enough to have multiple e-commerce players ply their trade.
