Indian giant Tata fluffs its lines as it takes on Amazon and Walmart

Shouldn't a company from the same stable as Tata Consulting Services do better with a day one traffic flood?


Giant Indian industrial conglomerate Tata has launched its attempt to rival Amazon.com and Walmart's e-commerce efforts, but suffered a bad case of the first day scalability jitters.

India's e-commerce market is dominated by Amazon.com and Walmart-owned Flipkart, each of which enjoys around one third market share. Indian netizens enjoy the convenience of those services, but the nation's government has introduced laws designed to make life a little harder for foreign e-commerce players – in line with local sentiment and government promotions that emphasize the virtue of supporting local businesses.

No Indian business is bigger than Tata – a conglomerate that spans technology services, steelmaking, energy, housing, cars, chemicals, and even India's incarnation of Starbucks. The company's many tentacles also reach online through a grocery delivery service, electronics retailing, and online pharmacy.

While those digital businesses have done well, and have already secured 120 million customers, Tata wants more. The conglomerate took notice of Asia's increasing taste for superapps that bundle and link services, and decided to combine its digital services into a single app, and integrate others. Amazon and Flipkart have taken that route in India, and emerging rivals such as Reliance have done likewise.

Tata's superapp effort – Tata Neu – launched last week with not so much a triumphal bang as a thud.

Users complained of an inconsistent experience – or no experience at all, when servers and/or the app became unavailable.

Poor integration is another complaint, with users finding that the app does not offer a single shopping basket for the services it aggregates. Others have wondered why the app automatically populates with data sourced from other Tata digital services. Booking with partners such as airlines has proven glitchy at best, impossible at worst.

Those kinds of experience are perhaps not what should be expected from a Tata group product, given it owns $22 billion IT services giant Tata Consultancy Services – which professes expertise in e-commerce and even sells a platform.

It's certainly not the experience Tata Neu touted. The app's launch was accompanied by a promotional blitz during the Tata-sponsored Indian Premier League Cricket tournament, which attracts weekly television audiences of over 200 million viewers.

At the time of writing, four days after launch, downloads quickly topped a million and the app has decent reviews on the Google Play and iOS app stores.

But enthusiasm for the app – much of it tinged with patriotism – is harder to find than criticism.

Tata has plenty of time to improve the app and turn around consumers' perceptions and experiences. But India's best-supported effort at challenging US-based e-commerce titans has not started well – and local rival Reliance has already worked with Facebook to allow its 400 million subscribers to conduct commerce through WhatsApp, while Google and others are probing for opportunities.

Yet if Tata – with a huge customer base and access to enormous technology capability – can't successfully take on Amazon and Walmart in India, who can? ®

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