ONDC is inevitable, to democratise ecommerce: CBO Joshi

Joshi said ONDC will help small retailers which currently account for a mere 4-6% of the entire retail space

Open Network for Digital Commerce's (ONDC) Chief Business Officer, Shireesh Joshi, says that the protocol is inevitable and rewards will go to those who start early. Speaking to DH's Reshab Shaw on the sidelines of Bizom's CPG Leadership Meet in Bengaluru, Joshi said ONDC will democratise the fast-growing ecommerce sector and help small retailers which currently account for a mere 4-6% of the entire retail space.

ONDC was launched as a pilot project on April 29 and is being touted as a government-backed scheme to take on online ecommerce giants such as Amazon and Flipkart. In total, seven companies have adopted protocols and built their own ONDC compatible apps: one buyer-side app, five seller-side apps and one logistics service provider app.

Joshi also added that the ONDC protocol will add interoperability which was missing hitherto and bring the remaining 95% of the population, which doesn't use ecommerce, into its digital the fold. Edited excerpts.

First of all, take us through the look and feel of the protocol

What's the look and feel of a telecom spectrum? You don't see it but you know that people are connected because there are telecom operators who are connecting to callers or to message receivers. The key takeaway is, to buy anything you have to go inside a platform as of now. But once you're on ONDC, it doesn't matter where or the seller is connected, you can still have a buying-selling interaction.

Why would someone choose ONDC instead of the other popular apps, say Amazon or Flipkart? How will you build trust?

First of all, we have to stop thinking about just two or three existing players. And ONDC is not an app. India is a huge country, we are more than one billion people. And today, less than 10% of all retail activities take place on e-commerce. So the names you mentioned are dominating the 5%, while the rest of the 95% retail value is still happening physically. The first part of what we're trying to do is to enable those 95% to join e-commerce as well. Instead of one party creating the full solution, ONDC will enable multiple parties to join together and create the full solution and there will be limitless such combinations. Today you depend on one app to do everything. With ONDC you will have many options, and ONDC will connect multiple providers based on your need and selected by you to create an e-commerce transaction. The existing platforms also have the ability and opportunity to join the ONDC network. And they should. It is beneficial for them too. They're in conversation with us, and at some point soon, they too will join.

Talking about the 95%, many are technically not savvy, so what is the plan to bring them onboard?

Eventually, everybody will digitize but not at once. Some will get done faster, others later. When mobile phones first came in the mid 1990s, mobile phone calls cost Rs 16/minute and only a select few could afford. Now they cost less than a paise per second and just about everybody can afford them. Nobody could be certain back then how far it would penetrate. But it did because many players brought in new opportunities. So, you're right. Similarly it's challenging today when we think of India's vastness and even if somebody were to attempt to solve it, they say what's the point? If I digitize a kirana store, how will anybody even buy from the store? But once the ONDC comes into play, and it becomes possible for anyone to buy or sell, then it will be hugely beneficial. The smallest Kirana store can be discovered and it will be worthwhile for many to enable such digitisation. Enablement and democratization is happening.

Will the whole notion of onboarding a seller on a platform change with ONDC?

See, the idea of onboarding platform by platform was needed in the old way of doing e-commerce, because e-commerce companies had to build all the components themselves and were building buyer and seller bases as an exclusive asset and competitive advantage. And this was the only way because there were no standards for interoperability and no reliable mechanism to bring complementary parties together. You could not buy from one place and say order delivery from somewhere else because they were not connected. On ONDC, multiple onboarding is not necessary. All existing platforms that have onboarded sellers in closed e-comm solutions today, can just join ONDC and all their sellers will be automatically visible to the entire buyer universe. No separate onboarding is necessary. And with ONDC you can not only buy a product, you can also buy a delivery service. Delivery and product companies alike will be connected to the network. So it will be a very flexible system.

What's the way forward for ONDC?

I think the speed at which things are moving is incredible. This was just a concept two years ago, it was a little bit more than a concept in the middle of last year when an advisory council was formed. But, in just 10 months we've gone from being an advisory council to going live in the market. I think everyone needs to move fast and come on to it. ONDC is inevitable and I think the rewards will go to those who start early because there's a lot of learning and innovation that are possible. Because once innovation is done, then it is harder for others to come and find that same space. So, speed is of the essence. It's not very complicated and neither is it very difficult.