In August 2021, US retail behemoth Walmart held a two-day retail tech conference called Converge, which set out to “decode what will shape the future of retail”. Among the topics discussed was the company’s recent entry into India’s social commerce segment through Shopsy.
Launched in July as an app, Shopsy wants to onboard 25 million “resellers” by 2023, who would go on to create catalogues from the 150 million products listed on Walmart-owned Indian e-commerce giant Flipkart. These products would then be sold through other social media and communication channels such as Instagram and WhatsApp.
Resellers are the heart and soul of social commerce. Unlike in e-commerce, where there’s just two sides—the seller and the buyer—social commerce is a three-sided marketplace, with resellers earning a commission off each sale.
“We are very excited about Flipkart’s new Shopsy. It is a world-first foray into social commerce for us. It provides a very low entry barrier for people to start a business and is also a fun and easy way to introduce people to online shopping,” Judith Mckenna, Walmart International president and chief executive officer (CEO) said said CNBC TV18 Flipkart's Shopsy world-first foray for Walmart into social commerce Read more at the event.
Flipkart already had a finger in the refurbished market pie with 2GUD, a Flipkart website that catered to value-conscious customers. Launched in 2018, it sold refurbished smartphones, laptops, and home appliances, before branching out into other low-value products such as clothing.
More importantly, 2GUD had toyed with the idea of resellers idea of resellers Livemint Flipkart’s 2GUD launches video-based shopping experience on app Read more . Despite Flipkart’s reputation, the company feared that some customers still lacked trust in the e-commerce model. “We could build that trust through resellers and influencers, who customers knew and would buy from. We had the products, we knew the customers and this was the way to reach out to those customers,” a former executive from Flipkart with knowledge of the matter told The Ken. This executive and others from Meesho and Flipkart spoke to The Ken on condition of anonymity as they’re not authorised to speak to the media.
From 2GUD, Shopsy was just one hop, skip, and jump away—Flipkart absorbed the refurbished segment into the main site and spun off what remained into the social commerce app. It also made sense from a market perspective. According to a 2020 report report Bain Unlocking Digital for Bharat $50 Billion Opportunity Read more by consulting firm Bain & Company, India’s social commerce sector is expected to be worth 2X the current e-commerce market within ten years.