Bengaluru: Future Group, led by Kishore Biyani, downsized its e-commerce venture, Retail 3.0, and laid off 350-400 employees, four former employees aware of the developments, on condition of anonymity.
The two said layoffs due to roles in sales, product development, marketing and ground operations have been made in recent months. Future Group recently closed many of its EasyDay stores in the midst of a small drag on the EasyDay app.
The closing of 140 EasyDay stores in November, he reported The Economic Times, was part of the same restructuring exercise, said one of the two people mentioned earlier.
Announcing Future Group e-commerce strategy for 2017, Biyani emphasized emphasizing technology with existing physical stores. “The idea was to turn the entire Future Group consumer journey into an online world,” said another person quoted earlier.
A Future Group spokesman confirmed the layoffs without disclosing details.
In late 2016, the retail sector began engaging in digital assets to support a new e-commerce strategy. Biyani unveiled the Retail 3.0 initiative at Nasscom Product Conclave in November 2017. By 2018, it had 500-600 employees building various digital assets for Retail 3.0. In November 2018, e-commerce giant Amazon bought a 9.5% stake ₹2,500 crowns at Future Group.
Last week, Amazon and Future Group said that Amazon India would become the authorized online retail channel for Future Retail Ltd, and Future Retail would ensure that relevant stores participate in the Amazon India market and in their programs.
In April 2017, Future Group announced a research and development unit called C&D (Consumer and Digital) Labs in Bengaluru. “They (C&D Labs) were developing a map of the entire Future Group consumer journey … basically a psychographic analysis of the customer,” said the first man, quoted earlier. “For example, if we knew the customer’s age, gender and marital status, the products will be marketed to him or her from a database of pre-orders of similar orders.
By 2019, Future Group has decided to pull the plug and massively reduce its digital strategy due to slowing spending and delays in proposed e-commerce venture investments.
According to another person, C&D Labs, which was taken away from Future Consumer Ltd, had about 150 employees.
Some laid-off employees worked on two key digital assets, including software designed to manage loyalty programs in physical stores and a hyperlocal delivery application called EasyDay. Shop-offering software is built to make it easier for customers on board for a loyalty program at pricing ₹999 per year.
“As much as 40-45% of the revenue of each sales unit was managed by the loyalty program,” the first person said. The program is also affiliated with the EasyDay app, where paid members receive a 10% discount on each order. However, the app is currently limited to customers in Delhi’s capital city.
The beta phase of the EasyDay application was introduced in 22 stores in northern India, but never left the testing phase, according to two people previously quoted.
When Future Group began closing stores in 2019, customers began seeking a refund, and the company began moving memberships to other nearby EasyDay stores as a solution, another person said.
“A future group gathered around ₹38 valuable memberships through it ₹999 initiatives, but since the delivery product never made the beta phase, it never saw a national rollout, “this person added.
“When a traditional retailer like Future Group starts investing in e-commerce, the company should be sure how deeply they want to integrate the technology into their units and whether they want to build it from the ground up or start acquisitions.” said Harminder Sahni, managing director of Wazir Advisors. “And with the latest tie-up between Amazon and Future Group, it’s clear that a new strategy for Future Group is entering the omni-store model. But it’s unlikely to stop with that model alone; since they’re highly adaptable to new technologies, it could it is expected that they will soon come out with newer models for sale online. “