Facebook invested in Meesho, an Indian social commerce platform that connects resellers to customers via WhatsApp and Facebook. Social commerce in India could account for $70B in online retail sales in the next 10 years, more than doubling the current e-commerce market size. Social commerce focuses on lower income customers in non-metropolitan areas and allows small businesses to directly communicate with customers about products through social platforms like WhatsApp without large marketing budgets.
Facebook invested in Meesho, an Indian social commerce platform that connects resellers to customers via WhatsApp and Facebook. Social commerce in India could account for $70B in online retail sales in the next 10 years, more than doubling the current e-commerce market size. Social commerce focuses on lower income customers in non-metropolitan areas and allows small businesses to directly communicate with customers about products through social platforms like WhatsApp without large marketing budgets.
Facebook invested in Meesho, an Indian social commerce platform that connects resellers to customers via WhatsApp and Facebook. Social commerce in India could account for $70B in online retail sales in the next 10 years, more than doubling the current e-commerce market size. Social commerce focuses on lower income customers in non-metropolitan areas and allows small businesses to directly communicate with customers about products through social platforms like WhatsApp without large marketing budgets.
Facebook invested in Meesho, an Indian social commerce platform that connects resellers to customers via WhatsApp and Facebook. Social commerce in India could account for $70B in online retail sales in the next 10 years, more than doubling the current e-commerce market size. Social commerce focuses on lower income customers in non-metropolitan areas and allows small businesses to directly communicate with customers about products through social platforms like WhatsApp without large marketing budgets.
It all started with social media giant Facebook investing an undisclosed
amount in Meesho in June. Meesho is a marketplace for resellers and connects them with customers via social media channels like WhatsApp and Facebook. “ With this investment in Meesho, we want to fuel a business model that can result in rapid job creation and the rise of a female entrepreneurial class in India. ” - Ajit Mohan (Facebook India head) Social commerce in China has grown rapidly over the last few years and now accounts for over 15% of online retail sales in China, growing 2x the rate of the overall online retail sector [1]. In India, Social commerce may track a similar trajectory and could account for 15% to 20% of online retail in India in the next 10 years, creating a market worth $70B [2] (more than 2x the size of the current e-com market in India)
[1] Internet Society of China and Chuangqi Social Commerce Research Center Report 2019: EMarketer report China [2] Unravelling the Indian Consumer 2019 — RAI Deloitte report; Sequoia internal estimates $70B Social Commerce opportunity for India
The next billion-dollar opportunity for India
Social commerce focuses solely on middle-income and lower-income
segments from non-metropolitan cities in India to sell non-branded apparel, groceries and local handicrafts. The social part of these platforms comes from the fact that users can get better deals or earn money by rounding up their friends and family to make purchases through them. Driven by Facebook posts and WhatsApp messages, social commerce companies rely on the oldest form of advertising: word of mouth. Simply put, a person is more likely to buy something if it is recommended by somebody they know and trust (Source: Inc42).
Online commerce 1.0 (Amazon) removed the barriers of geographic coverage,
allowing brands access to millions of customers across regions they never had access to.
E-commerce 2.0 saw the advent of marketplaces (Shopify, WooCommerce in
India; Taobao, Tmall in China) that enabled small businesses to list their products online, but sellers were limited by the eyeballs they could drive to their products on these marketplaces, or the advertising on these marketplaces.
The rise of social first models democratizes e-commerce further. A
small business selling on WhatsApp doesn’t need to pay huge marketing expenses to get consumers. They can also talk directly to consumers about products and trends they care about in their own language, building deep roots in their community while leveraging their customer’s personal networks. The evolution of this model is a process of decentralization that fits the modern consumers’ need for more personalized and differentiated products.
WeChat, the leading messaging app of China, has now become one of the most powerful distribution platforms globally. It offers 1B+ daily active users compared to ~300M on Taobao/Tmall (largest commerce platforms in China) to businesses using its platform (Source: TechCrunch). WeChat now drives $150B+ in trade annually and has given rise to several multi- billion-dollar companies across various categories in China.
