Revolutionary Move: Ajio Street To Move Into Zero-Commission

With Ajio Street, Reliance Industries seeks to broaden its e-commerce strategy. The company is developing a new marketplace model for low-priced, longtail fashion items through its e-commerce venture Ajio.

Ajio Street: India’s Stylish Online Fashion Marketplace

Ajio.com created Ajio Street, an online fashion marketplace in India. It offers a large selection of current and stylish attire, accessories, and accessories for both men and women. For its distinctive and daring selection that appeals to the young and fashionable clientele, Ajio Street is renowned.

It offers various apparel designs, from streetwear to boho and traditional to modern. Also, Ajio Street works with various independent and up-and-coming designers to provide them with a stage on which to present their work and connect with a larger audience. The primary focus of the update is to introduce a zero-commission platform through Ajio Street, creating a new arena for designers to sell in.

Ajio, which till now competed with companies like Tata Cliq, Nykaa Fashion, and Flipkart-led Myntra, has also become a competitor of Meesho. Meesho’s platform lets resellers offer a variety of inexpensive goods with an emphasis on Tier-II, and III cities and villages, aiming at middle-class, and lower-middle-class sectors.

Another goal of introducing Ajio Street is to familiarise customers not yet handy with online shopping on this forum, usually residing in non-metro, small-scale cities. These brand-new customers can easily access Ajio Street on the original Ajio app through a separate window. The app works on a 15-day payment agreement for the merchants, the brainchild of Reliance.

How does a zero-commission model work?

A company does not take any commission from its sellers in a zero-commission approach. The theory is to get more and more independent merchants to sign up on the platform without sharing a portion of their sales from items priced between rupees 300-350.

According to a recent report by Bernstein Research, 80% of sellers at Meesho are retail business owners, and 95% of the products offered there are unbranded. Reliance plans to legitimize the earnings of Ajio Street through one of the two options- running ads or delivering shipping services.

Reliance Retail’s Growing Business and Ajio’s Competition

Meesho, the direct rival of Ajio Street, saw its operating losses increase by more than 6X in the fiscal year 2021–2022, recording an average loss of about INR 3,247.8 Cr (FY22) in that time. this is 550% more than the past financial year when the losses were about INR 498.6 Cr.

Ajio has not been its only front in e-commerce; Reliance also launched its home brand in e-commerce in the beauty and lifestyle category with Tira. The brand plans to unveil various growth areas, the most recent being a debut shop in Mumbai, the first of many future outlets in the country.

Future of Fashion E-commerce

While the fashion category in India sees 20% of its business online, about 18% of Reliance Retail’s entire revenue is attained from its online and new e-commerce businesses introduced. This was seen from the third quarter of the financial year 2022-23, witnessing a 38% year-on-year (YOY) rise.

Since 2014, Indian E-commerce has become a significant attraction for investments, bringing in more than $31 Billion and observing the Compound Annual Growth Rate of almost 19% since 2022. The introduction of Snapdeal on ONDC last year along with a proposed expansion in the next quarter, and the entrance of Ajio Street in the affordable easy e-commerce is proof of the booming business sector, which is assumed to achieve at least $400 Billion by 2030.