Here’s what you will learn:
From small shops to big emporiums, the Ancient Indian bazaars had surprised everyone at every turn. However, in this ever-evolving digital landscape where the rules of business are constantly changing, Indian bazaars are facing fierce competition. To bring Indian bazaars back to life, the government is leaving no stone unturned and one of the bold bets at the core of this effort is ONDC.
With ONDC the Possibilities are Endless. It aims to create a dynamic digital commerce universe that is bigger, broader and more inclusive than ever before.
Table of Contents
A New Era of Digital Commerce: ONDC Leading the Way!
Introducing ONGC: The E-commerce Game Changer!
ONDC, which stands for Open Network for Digital Commerce, is a decentralized network designed to foster open interchange and connectivity between consumers, technology platforms and retailers.
“Join ONDC or you’ll be left behind.”
The ONDC network is open to all existing and new digital commerce applications and platforms that voluntarily choose to be a part of it.
The Call for Open Commerce and the Birth of ONDC
“In the physical market, everybody gets an opportunity to compete based on the strength of their products, and their marketing strategies unlike in e-commerce where the intermediary platforms have the stranglehold,” – T Koshy, CEO of the Open Network for Digital Commerce.
The Indian market is dominated by big intermediary platforms such as Amazon and Walmart-owned Flipkart, which control more than 60% of Indian e-commerce trade. This duopoly gives them significant power to favor certain sellers and put pressure on suppliers, leading to an uneven playing field and squeezing smaller businesses. To address this issue and promote fair competition, the Indian government has introduced the Open Network for Digital Commerce initiative.
The main goal of ONDC is to level the playing field in the e-commerce sector. This initiative is especially crucial because more than 80% of India’s market comprises small, unorganized retail businesses and holdings.
Core Objectives of ONDC
ONDC: Everyone’s commerce!
Where anyone can sell, and everyone can buy from each other online.
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- Democratization and Decentralization: Open Network for Digital Commerce helps level the playing field by breaking the hegemony of major e-commerce giants and granting small and local enterprises an equal opportunity to participate and compete. With the ONDC network, they can easily present their goods and services to a larger audience without being dominated by intermediary platforms.
- Accessibility and Inclusivity: It open doors to new opportunities for everyone, which benefits the entire e-commerce sector. It offers equal opportunity for every seller to take part in the rise in digital commerce, regardless of their size or resources.
- Increased Choices and Independence: In line with the motto ‘Customer Is the King,’ ONDC places a strong emphasis on customers’ needs. With ONDC, customers may access a large number of sellers from various platforms, allowing them to look through a variety of options and select the ones that best suit their needs.
- Goods and Services are more Affordable: It helps make the market more competitive, enabling consumers to benefit from competitive pricing. Furthermore, it helps decrease the overhead costs associated with traditional e-commerce platforms, resulting in lower prices of products.
A Paradigm Shift: Before and After
Key Participants in ONDC
ONDC includes various participants to create a comprehensive and interconnected digital commerce ecosystem:
Three Components- Buyer Apps, Seller Apps and Gateways.
Three Wings: Buyers, Sellers and Logistics.
- Buyer-Side Applications: Buyer apps are network participants that handle the demand-side platform and are responsible for buyer-side operations such as building carts, displaying search results, tracking orders, handling customer grievances and providing functionality for buyers to place orders on the open network. Customers can use buyer apps to access ONDC. Paytm, SpiceMoney and MyStore are a few examples of ONDC-enabled buying apps.
- Seller-Side Applications: Seller apps handle the supply side of transactions. These apps deal with initial search queries such as product availability, product offers, handle dynamic pricing, and manage settlements and logistics. Growth Falcons, ITC Store and eSamudaay are several ONDC-enabled seller apps.
- Logistics: Logistics service providers help manage the logistics between sellers and buyers. Sellers can either fulfill or deliver orders on their own or seek assistance from logistics providers that are onboarded on the ONDC network. This helps ensure timely delivery and better customer satisfaction. Some examples of ONDC-enabled logistic apps are Dunzo, LoadShare and Shiprocket.
- Gateways: Gateways serve as nodes or middlemen, facilitating multicast search queries and collecting results. It enables communication between buyer applications and seller applications listed on the ONDC Network.
- Other Specialized Service Providers: ONDC encompasses other network participants who offer additional specialized services:
- Payment Service Providers
- Reconciliation Service providers (For reconciling payments across multiple network partners)
- Settlement Agency
- Online Dispute Resolution (ODR) service providers (Resolving conflicts across multiple Network Participants)
ONDC: A True Disruptor in the Market or just Hype?
“ONDC to not drive anyone out of business.”- DPIIT
It is not a government-owned marketplace. It is only a network created by the government, which functions as an intermediary layer between buyers and sellers.
In fact, many big players like Flipkart, Paytm, Dunzo and more have already joined the revolutionary ONDC, and many others are in the process of joining.
What are the Advantages of ONDC?
- Increased Transparency: As a government initiative, ONDC ensures greater transparency by making government data more accessible to the public, which helps build trust and accountability. The increased access empowers individuals to make well-informed decisions and hold entities responsible for their actions.
Furthermore, ONDC utilizes Blockchain Technology to collect and store data on its platform, ensuring data is more secure and tamper-proof. - Increased Customer Choice: ONDC lowers the entry barrier for small businesses, promoting fierce competition in e-commerce. This helps diversify the market, providing consumers with a wider range of options.
- Driving Innovation: ONDC can spur innovation by providing businesses with access to a pool of government data. By utilizing this data, enterprises can identify new trends and modify their products to suit changing customer demands.
This can result in the creation of new products and services that benefit society. - Cost Savings: The ONDC promotes greater competition among e-commerce service providers, resulting in reduced costs by cutting down transaction charges, commissions, advertising expenses and more.
Moreover, ONDC’s streamlined processes and improved logistics infrastructure assist in reducing costs associated with supply chain and inventory management. - Protecting the Consumers’ Interest: ONDC promotes fairer practices, improved services, and better protection of consumer rights. It helps establish a robust framework for addressing customer grievances, ensuring prompt and fair resolutions.
The transparency in the ONDC network helps boost consumer confidence in e-commerce. - Neutral and Regulated Network: ONDC is a government-backed initiative that operates on a network-centric model, enabling buyers and sellers to easily transact goods and services independently of the platform or application. This unbiasedness in ONDC helps foster collaboration, prevents favoritism, and promotes a fair and regulated digital commerce environment for everyone.
- Customer Support: For ONDC, customer support is its top priority. It provides dedicated 24/7 customer support to promptly address all concerns or queries raised by the Users. They can easily connect with ONDC’s support team for assistance with purchase tracking, payment concerns, or other general inquiries.
Moreover, Enhancing Value for the Entire Ecosystem
Room for Growth in Digital Commerce: Now or Never for Businesses!
In 2021, India ranked eighth among global economies in the size of its digital commerce market, accounting for 7 percent of the total retail market. This was less than China’s market share, which stood at 25 percent of the total retail market, despite both countries having a similar number of potential consumers (approximately 140 Crores).
However, the availability of low-cost data and smartphones has made it possible for Indian consumers to integrate themselves into the digital commerce landscape. For enterprises, this presents a ‘Now-Or-Never’ opportunity to kickstart their digital commerce initiatives. As the Open Network for Digital Commerce (ONDC) gains momentum, it will definitely transform the Indian e-commerce industry, offering new business opportunities, empowering enterprises and upgrading the digital commerce experience for millions of Indians.
The Thrust to Cross-border E-commerce: ONDC’s Future Growth Potential
Though ONDC is India’s innovation to reshape e-commerce, the problems that ONDC can easily counter are global in nature.
Despite the rise in Internet connectivity across the world, for many enterprises, especially for small sellers, cross-border trade and digital commerce remain beyond reach. ONDC can be the perfect solution here. ONDC can significantly influence global trade in several ways:
- Streamlining Cross-Border Transactions: ONDC’s interoperable framework makes cross-border transactions more efficient. It also helps reduce complexities and costs associated with international trade, encouraging more businesses to engage in global commerce.
- Enhancing Regulatory Compliance: ONDC’s transparent and standardized platform helps businesses adhere to international trade regulations. Globally, compliance costs vary from 2% to 15% of the overall cost of trading goods. ONDC can significantly reduce these costs, making it easier for companies to comply with various trade norms and standards.
Getting on board with ONDC
Open Network Digital Commerce has not only revolutionized the existing e-commerce infrastructure but has also opened new growth opportunities. However, developing highly advanced digital commerce websites and applications requires special attention and technical expertise to ensure that everyone within the ecosystem enjoys easy access to features that enhance their overall experience with the platform. This is where OrangeMantra comes in.
OrangeMantra: Your Path to Innovative ONDC App Solutions!
OrangeMantra is a top-tier open-network digital commerce app development company, assisting clients in creating a decentralized commerce ecosystem. Leveraging our expertise in the e-commerce business domain, we develop highly complex digital commerce websites and applications for our clients all over the world
Why OrangeMantra?
- Unmatched development expertise.
- Advanced and affordable business solutions
- Certified and experienced development team.
- Transparent pricing policy.
- 24*7 customer support.
Wrapping Things Up
“Calling ONDC a pathbreaking moment wouldn’t be an overstatement”!
For India’s eCommerce to come of age, it is important to incorporate the smallest and remotest businesses possible. By empowering small and local businesses, ONDC promotes economic growth and innovation in the digital commerce sector.
ONDC is a game-changer in the Indian e-commerce landscape, fostering fair competition, inclusivity, and transparency. It’s high time for businesses to embrace the opportunities offered by ONDC and witness unprecedented growth and transformation.
