Daily News Digest- 8th Jan'15

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• Flipkart to Rope in Authors at Jaipur Lit Fest to Write on Books: Flipkart is sending a team to Jaipur Literature Festival (JLF) to persuade authors at the event to engage with its 26 million customers. The event is scheduled for January 21-25. The online retailer plans to start a section where authors will write about their work, inspiration and books that had an impact on them along with recommendations, interviews and podcasts in the next few months. “We are looking at authors who will tell our buyers their recommendations, books they are reading and we will look at targeting the aesthetics of the customers. Ultimately, this will impact sales as well,“ said Vivek Tejuja, manager, books (customer engagement). Flipkart has reached out to publishers of authors such as Amish Tripathi, VS Naipaul, Samanth Subramanian, Namita Gokhale, Aakar Patel and Jeet Thayil and the response has been “positive“, he said.

• Jet Airways Hires Alvarez & Marsal to Fly Higher: Jet Airways has hired professional services firm Alvarez & Marsal (A&M) to help it turn around within a year, a development that comes months after it sold a 24% stake to United Arab Emirates-based Etihad Airways. The move comes after Jet Airways posted seven successive quarters of losses till second quarter of the current financial year.Although Jet Airways, India's second largest airline, posted a quarterly profit in the quarter to September last year, analysts say the company is still not out of the woods as the profits were mainly due to one-off gains. The Mumbai-based carrier has mandated A&M to help it clock profits for 12 months in a row, executives familiar with the matter said on condition of anonymity, adding that the company could turn around in the coming quarters even as its competitors and industry analysts remain sceptical. “Jet Airways is working with A&M on initiatives that support the airline's return to profitability.The A&M team is working with the airline's senior management team to support the development and execution of business improvement initiatives designed to enhance Jet Airways' overall business performance,“ an official spokesperson for Jet Airways told ET. 

• Flipkart Plans Collection Centres to Tap Smaller Cities: Flipkart, India's largest online retailer, plans to set up pickup or collection centres in smaller cities with a population of up to 50,000 as it seeks to tweak its delivery model to tap into the growing demand in these markets. The Bengaluru-based company could kick-start the process in April this year and open up to 270 such centres by the end of March 2017. “So we can have a lot of people from tier-4 or tier-5 cities coming and collecting their stuff if we set up pickup centres,“ said Sujeet Kumar, head of WS Retail and ekart Logistics. WS Retail is the largest seller on Flipkart and ekart is the logistics and delivery arm that delivers 85% of Flipkart's goods to buyers in nearly 300 cities across the country . “You cannot develop a hub network for such areas. Pickup centres will work for such areas. We may start with 20 cities in the first half of the year. Scaling up is very fast. In a year and half I can open centres in 250 more cities if the response is good,“ Kumar told ET.

• Amazon to Bring More Offline Sellers on Board: Amazon India may soon extend its online payment gateway to offline sellers listing on its price comparison website Junglee. This is aimed at bringing small sellers and kiranas to the online platform, said two senior industry executives aware of the plans. The initiative is in sync with Amazon founder and CEO Jeff Bezos's strategy to get small of fline businesses in India into the digital economy. It's also part of the company's plan for a wider presence in the country through two websites simultaneously -Amazon India and Junglee. Amazon currently offers its payment gateway in Junglee only to online sellers -more than 250 shopping sites use it. Offline sellers can put their business listing on the website, which shows up when a consumer searches for a product but any transaction is only conducted offline. This is currently available only in seven cities -New Delhi, Kolkata, Mumbai, Bangalore, Hyderabad, Gurgaon and Chennai.

• On-demand Delivery Cos Sprout in Cities: For couch potatoes there is now hope. Big cities in India are increasingly witnessing the emergence of a new bunch of startups eager to deliver a whole range of services to people at their door step. On-demand delivery companies are picking up groceries, cakes, flowers, meals and even trucks from local neighbourhood stores and suppliers on their behalf. Startups like Bangalore's Delyver and Gurgaon's Grofers deliver groceries and meals. Scootsie (formerly known as Meals on Wheels) in Mumbai specialises only in restaurant deliveries for now but are keen to expand into hypermarts.Blowhorn, also known as Uber for trucks, arranges mini-trucks for relocation in Bangalore in a span of few hours. These companies have tied up with hypermarkets, meat shops, flower shops, restaurants for deliveries. A customer can log on to their respective smartphone app or website to place orders from listed local stores and restaurants. 

• Lipsticks, Lotions Get a Halal Touch: Mauli Teli and her younger sister Grishma Teli are probably the first entrepreneurs who have forayed into the niche segment of halal cosmetics in India. They believe halal cosmetics are good not only for Muslims but also for whoever wants to avoid chemical-ridden products and seeks healthy living. Halal is an Arabic word for `that which is lawful or permitted'. “The word halal is a universal tenet and if a product is halalcertified, it means it doesn't contain alcohol, animal ingredients and harsh chemicals and is not tested on animals. So, it gives people the reassurance that it is pure and natural,“ says Mauli Teli, CEO & managing partner of Ecotrail Personal Care, insisting that halal is for everyone.

• Wipro Wins $400-m Deal from ABB: Wipro has won a $400 million, multi-year IT infrastructure management contract from Swiss engineering giant ABB, making it the largest deal for the technology company since the $1.2-billion contract it received from Canadian utility ATCO last July. The deal win underlines the nation's third-largest IT company's prowess in strengthening its cloud offerings, because it will move a lot of business applications to cloud in addition to maintaining the back-end technology of ABB.

• Etailers Go the Extra Mile to Rein in Rogue Traders: Stung by instances of rogue sellers on their platform shipping dubious products, online marketplaces are putting in place measures to tighten systems and avoid signing up sellers who can tarnish their brand image. The steps range from physical checks to spending more on analytics to monitor marketplaces.For instance, in the case of Amazon India, internal audits with employees posing as shoppers is a regular feature. While there is no foolproof mechanism to screen the sellers joining a marketplace, each portal has come up with its own mechanism to weed out merchants who don't make the mark.Though the marketplaces are facilitators, they are required to carry out due-diligence of the merchant ahead of signing them up. “Legal aspects like entity structure, background checks of the entity or persons in charge of the business and commercial aspects like its key customers, etc have to be considered. This would go a long way in helping e-commerce companies manage their reputa tion risk as they cannot afford to completely wash their hands of the products sold on their platform,“ said Sharanya Ranga, partner at law firm Advaya Legal.While physical checks form one aspect of it, spending on analytics to monitor marketplaces is on the rise. The suspect sellers are not formally informed but are depromoted from homepage and category lists. In the case of Amazon India, random sampling by mystery shoppers keeps a check on quality of items shipped by sellers who directly pack and ship items. Where sellers use the company's packing and shipping service, mandatory checks at the fulfilment centres are carried out to prevent shipping of counterfeits and damaged products. “We scrub our platform periodically to test random sample products and take action,“ said an Amazon India spokesperson. The marketplace has 16,000-plus sellers of which more than 14,000 were added over 2014.

• Offline stores offer e-com experience: How would you like it if you could go to a garment store, stand before a screen there, and see how you would look in one of the dresses displayed on a poster without trying it out? Or walk into a mall, and have your favourite brand find out you're in there and offer you a special discount? Brands know you will love this, and are roping in startups to bring such technology inside brick-and-mortar stores. With consumers getting used to the conveniences of the online shopping world, brickand-mortar stores are using technology to bring in features like `virtual reality', `unlimited product stock', `similar searches' or `related products' options.Nike, USPA, Satya Paul and Being Human are among the brands using technology products in their stores to give customers the advantages that ecommerce portals offer. Shopsense is one such startup which provides brands technology-based solutions to engage with customers in the store. The company installs a tablet-like device in the store, which customers can use to browse through all the brand's products, the way they would on an e-commerce portal. It allows customers to mix and match products and see how they would look in the ensemble. “There will also be more engagement between the customer and the store salesperson. The salesperson can observe what the customer is looking for on the screen, and pick out similar products from the shelves. Customers can also look at inventory from other outlets and this sometimes helps brands reduce real estate costs,“ says Harsh Shah, co-founder of Shopsense. Brands say that using such products see a 12-15% increase in revenues.

• Quikr Launches Chat Service to Boost Sales: Classifieds portal Quikr has launched an instant messaging service to bring buyers and sellers together on its online platform as it looks to stay at the centre of the transactions that were previously struck offline. Earlier, the website allowed users to check the products online and close the deals by interacting through email or calls. The instant messaging or chat service, which can be used both on the desktop and mobile, will help the Mumbai-based start-up provide better value to small business owners who pay for listings. “This will help us in monetising. Now a small business owner, who buys a package of listings, can see the value and have a record of the deals struck through us,“ said Pranay Chulet, CEO and founder of Quikr.

International:

• Iconic Bentley All Set to Drive Out World's Most Expensive SUV: Bentley , the British car manufacturer favoured by the Queen of England, said potential customers are already queuing for the world's most expensive sports utility vehicle (SUV) ahead of its introduction later this year. Boasting of the SUV's ability to cocoon passengers in luxury even far from a paved road, Wolfgang Duerheimer, head of the Crewe, England-based unit of Volkswagen, said Bentley expects to sell about 3,000 of the high-end units each year once the model hits showrooms in 2016. The company has already seen interest from 4,000 potential buyers who have yet to view the vehicle. “The Bentley SUV will be the most exclusive, most luxurious and most expensive SUV in the world,“ Duerheimer told journalists on Wednesday in London, showing a video of the car driving up sand dunes.“The level of luxury will be extraordinary .“ The model is vital for Volkswagen's goal to boost Bentley sales to 15,000 vehicles by 2018. The marque's global deliveries rose 9% to a record 11,020 cars last year, Duerheimer said on Wednesday , with the US remaining its largest segment, contributing 29% to total sales. China, where more than 1 in 3 luxury vehicles sold last year were Bentleys, will be the marque's key growth market, said Kevin Rose, the sales chief. Total sales there rose 22% to 2,160 from last year, representing 24% of the unit's total.

• Motorola heads back into China's smartphone market: Motorola has announced it will re-enter the Chinese smartphone market from February with at least three products. China is one of the world's biggest and fastest growing smartphone markets. Motorola's phone business had retreated from the mainland in 2013 after it came under Google's ownership. However, in October last year, China's Lenovo completed the purchase of Motorola Mobility from Google, paving the way for the firm to re-enter the mainland's marketplace. Motorola said three of its products would go on sale from early February, or after the Chinese New Year holiday season, including its Moto X, new Moto X Pro and new Moto G.

• Tesco joins price war as supermarket plots recovery course: Tesco has joined the supermarket price war on the day that new boss Dave Lewis is due to set out options for reviving the troubled company. Following cuts by Asda and Sainsbury's, Tesco said it would reduce the price of some big-brand products, including Hovis, Coca-Cola, Marmite and Tetley. Later on Thursday, Mr Lewis is expected to outline further measures to revive Tesco's fortunes. Price cuts, job losses and asset sales are thought to be on the agenda. Tesco will want "to rebuild trust with customers, suppliers and the investment community," said Sanford C Bernstein retail analyst Bruno Monteyne. It comes after two years of troubles at Tesco, which has suffered falling sales, profit warnings, an accounting scandal and the departure of some senior executives. On Tuesday, Asda cut the prices of 2,500 "essentials" such as fruit and vegetables, cereal, nappies, toilet rolls, milk, meat, eggs and fish. Rival Sainsbury's also announced further reductions as part of a £150m price-cutting strategy announced last year.

• PVH Closing Izod Retail Unit: PVH Corp. Wednesday further reduced the retail exposure of its Heritage Brands with the decision to close the 120 Izod stores in the U.S. and Canada. Twenty of them will be converted to Calvin Klein or Tommy Hilfiger brand stores, with the remaining 100 units to be closed. The stores had sales of about $100 million a year. The move “has no bearing on our Izod wholesale business strategy,” said Manny Chirico, chairman and chief executive officer of PVH, “which has shown great growth with our most recent launch at Kohl’s for the fall 2014 season.” PVH expects to incur pretax charges of about $40 million, about half of them noncash, and complete the closures by the end of the 2015 fiscal year.

• Prada Sets Up Legal HQ in Italy: Miuccia Prada and her husband Patrizio Bertelli are starting 2015 with a fully Italian corporate structure, formalizing their decision to transfer the legal headquarters of their fashion group to their home country from Luxembourg. Prada Holding, as well as Bertelli’s holding Pa Be 1, and Bellatrix — controlled by the three Prada siblings, Miuccia, Alberto and Marina – have moved their legal seats to Italy. The designer and her husband were nominated administrators of Prada Holding, as well as their son Lorenzo Bertelli, born in 1988 and a World Rally Championship driver, together with Carlo Mazzi, who is the chairman of Prada Group, which is publicly traded on the Hong Kong Stock Exchange.

Tech:

• Huawei Tech to Upgrade Voda's Wireline Infra: Chinese telecoms equipment maker Huawei Technologies has signed a $150-million (about ₹ 900 crore) pan-India deal with Vodafone to upgrade and augment capacity of the telecom operator's wireline network to enable it to handle increasing data traffic. “Data is growing exponentially in India and telcos need to have bigger pipers, which can handle this kind of data growth and video traffic,“ a person familiar with the development said on condition of anonymity . “The solutions that Huawei is deploying can handle such data growth.“ The person added that the transformed backbone wireline network will also help Vodafone support its enterprise services and allow it to offer new data-rich services to its customers.The solutions will help telco reduce operating expenditure as well, this person said. Huawei and Vodafone India did not immediately respond to ET's queries. As smartphone sales surge, the Indian telecom industry is seeing subscribers use more and more data services on 2G and increasingly on 3G.

• 3G Floor Price: Trai Again, Says Telecom Commission: The Telecom Commission on Wednesday rejected the reserve price for 3G airwaves proposed by the Telecom Regulatory Authority of India (Trai) for next month's spectrum auctions and sent it back to the latter for reconsideration, signalling yet another skirmish between the ministry and the watchdog. This follows an internal telecom department panel report that was of the view that the base price of the 3G airwaves should be much higher than the ₹2,720 crore per unit proposed by the regulator. Trai will have to revert to the telecom department in 15 days. The final decision on the price will then be taken by the Telecom Commission, the top decision-making body of the department, and it will subse quently have to be ratified by the Cabinet. Over the last year, the telecom department has rejected all key pricing recommendations sent by the regulator.Only last month, it fixed the reserve price for 2G airwaves to be sold in the upcoming auction at much higher levels than those proposed by the regulator. In the 800 Mhz band, the telecom depart ment fixed the reserve price at 17% above that recommended, for 900 Mhz at 23% higher and for 1800 Mhz at 2.5% higher.

• Tweetdeck users can now translate tweets using Bing again: Twitter’s built-in translation feature that disappears and reappears at random is back again, but only in Tweetdeck this time. The feature, powered by Bing, shows a button for tweets that aren’t in the user’s native language and translates them instantly to a rough English version. The company confirmed to Marketing Land today that it’s launched inline translation with Bing in Tweetdeck again, but wouldn’t comment if it’ll be coming back to other platforms just yet.

• PayPal Now Available on BlackBerry 10 Phones: BlackBerry owners, rejoice! You can finally use PayPal on your phone, with the release of the company’s first app for BlackBerry 10 devices. original PayPal lands on BlackBerry 10 smartphones, now available on all major mobile platformsThe new PayPal app for BlackBerry allows you to do all the things you’d expect in PayPal like send/receive money, check your balance and see your transaction history. PayPal is touting the news as marking its app being available on all major mobile platforms, since it’s also on Windows Phone, Fire OS, Android and iOS. 

• It's Curtains for Google TV As Android TV Takes the Stage: Each year’s CES marks the launch of several new devices and technologies, but the electronics expo’s 2015 edition rang the death knell for Google TV, the company’s smart TV platform that launched way back in 2010 and never quite took off. And that’s probably a good thing. Google TV incorporated Android and Chrome into a 10-foot interface, compatible with a QWERTY physical remote, as the way to interact with apps, games and online video content on televisions.